Jul 2006 Financial News

RBTT Releases First Quarter Results

Jul 31, 2006

WISE is a subsidiary of RBTT Financial Holdings Limited

For the first quarter ended June 30, 2006, RBTT Financial Holdings Limited (RBTT) reported a diluted EPS of $0.63 which was 6.8% higher than the comparable EPS in 2005. After-Tax Profits stood at $217.19 million, an increase of 5% or $10.41 million over the comparable period in the previous year.

Net Interest Income for the period amounted to $441.62 million, an increase of 2.7% over the comparable period in 2005. However, Total Net Income of $683.09 million was lower than the comparable period in 2005 by 2.3%, as a result of Other Income falling by 10.2% to $241.47 million.

Provision for Credit Losses Net of Recoveries ended the period in a favorable position, with a positive turn of $43.77 million, to end at $17.88 million. This had the effect of increasing Operating Profit by 5.3% to $273.62 million. Quarter on Quarter the Effective Tax Rate increased marginally, standing at 21.5 % in the current period from 20.9% in 2005.

Total Assets increased by $416.80 million over the period, with Loans and Advances to customers increasing by $522.68 million. However the increase in Loans and Advances was offset by a decrease in the Investment Securities Portfolio of $113.69 million.

At the current price of $30.48, the shares of RBTT are trading at a trailing P/E multiple of 11.21 times, which is the lowest for the sector. In light of the current results, we have revised our forecasted EPS to $ 2.95. At the revised forecasted EPS and the current price, the shares are trading at an attractive multiple of 10.33 times. Additionally, these shares usually trade in the band of 11 to 15 times, which leaves a fair margin for growth in the share price. Thus, based on this, we maintain our recommendation of a BUY.



Gia Singh
WISE Research Team