MARC Ratings has affirmed its corporate credit ratings of AA+/MARC-1 on CIMB Group Holdings Berhad (CIMB Group) and AA rating on the group’s RM10.0 billion Basel III-compliant Tier 2 Subordinated Debt Programme. The outlook on all ratings is stable.

CIMB Group is the non-operating financial holding company of the country’s second-largest banking group with total assets of RM755.1 billion as at end-2024. Its financial strength is underpinned by the solid fundamentals of its key banking subsidiaries — CIMB Bank Berhad, CIMB Islamic Bank Berhad and Bank CIMB Niaga Tbk PT (CIMB Niaga). CIMB Bank remains the group’s primary operating arm, accounting for 86% of consolidated assets and historically contributing the bulk of CIMB Group’s dividend income.

CIMB Group’s consolidated pre-tax profit rose to RM10.4 billion in FY2024, from RM9.5 billion in the previous year, supported by steady net interest and non-interest income. Loan growth slowed to 2.6% in 2024, down from 8.3% in the prior year, with performance varying across regions against the backdrop of the group’s selective lending in response to competitive price pressures. Net interest margin registered at 2.21% in FY2024.

The group’s asset quality improved, with gross impaired loans (GIL) falling by 18.7% to RM9.6 billion as at December 2024, bringing the GIL ratio down to 2.12% from 2.67% y-o-y. Loan loss coverage strengthened to 123.8%, inclusive of regulatory reserves. As of end-2024, the group’s Common Equity Tier (CET 1) ratio stood at 14.6%, while its total capital ratio was at 18.3%, which includes a 1.0% CET1 surcharge due to its classification as a domestic systemically important bank.

At the holding company level, CIMB Group received RM5.9 billion in dividends in 2024, sufficient to service its financial obligations. Its debt-to-equity ratio held steady at 0.49x, with outstanding borrowings comprising Basel III-compliant subordinated debt utilised to support investments in similar capital instruments of its subsidiaries. Debt-servicing costs under the issuances have been met by cash flows from its subsidiaries. Liquidity coverage ratios and net stable funding ratios of its key subsidiaries stood well above regulatory requirements.