Malayan Banking Bhd (Maybank), the largest lender in Malaysia by assets, logged a 2.3% fall in quarterly net profit, while CIMB Group Holdings Bhd said its quarterly net profit was down 80%.

Net profit for Maybank came in at 1.95 billion ringgit ($479.12 million) for the July-September quarter, down from 2 billion ringgit last year, but higher than the 1.55 billion ringgit estimate from two analysts polled by Refinitiv.

CIMB recorded a 194.4 million ringgit net profit compared with 1.01 billion ringgit a year before, lagging an analysts' estimate of 633.5 million ringgit and charting a seventh straight fall in quarterly earnings.

Maybank's revenue slumped 57% to 13.76 billion ringgit, while CIMB's dropped 3.7% to 4.46 billion ringgit, according to bourse filings.

Maybank said net operating income for the quarter declined by 6.5% to 6.08 billion ringgit versus a year ago, as total net fund based income dropped 8.7% to 4.13 billion ringgit.

However, it saw a decline in impairment losses and higher net earned insurance premiums during the quarter.

Its net interest margin (NIM) - a key measure of bank profitability - contracted to 2.05% from 2.32% last year due to rate cuts. Malaysia has a record 125 basis points of rate cuts this year.

Maybank said loan loss provisions are expected to remain elevated and it will mitigate expected lower income by stepping up its strategic cost-management programme to limit increases in overheads.

"Our focus moving forward will be to leverage our risk management capabilities, diversified operations and digital strengths to drive our business in the coming year," Maybank's group president and chief executive, Abdul Farid Alias, said in a statement.

CIMB saw expected credit losses on loans, advances and financing rise 277% to 1.5 billion ringgit but said it registered strong operating income across nearly all segments.

"The Group is encouraged to see quarterly improvements with underlying performance remaining resilient despite the impact of elevated provisioning," it said.

Its NIM for the quarter was at 2.31%.

CIMB said it remains cautious on the prospects for the rest of 2020 as "operations will likely continue to be adversely impacted by the COVID-19 economic disruption across the region."

($1 = 4.0700 ringgit)

(Story corrects to 'net' in paragraph two)

(Reporting by Liz Lee, Editing by Sherry Jacob-Phillips)

By Liz Lee