This article first appeared in The Edge Malaysia Weekly on May 1, 2017 - May 7, 2017

INTEREST in investment banking has returned, says CIMB Group Holdings Bhd chairman Datuk Seri Nazir Razak.

“There seems to be a recovery in terms of interest to do deals and I think part of that is driven by leadership changes in some organisations, for instance, PNB (Permodalan Nasional Bhd) Group. These new leaders are looking at new ways to create value and you’ve seen some deals announced. I think even in other areas, there is a sense that people have been too docile in terms of deals.

“Deals can be done to reduce costs and synergise for more revenue. I certainly feel from the marketplace that there is a lot of interest again to approach investment bankers,” Nazir said at a press conference after CIMB’s 60th annual general meeting last Friday.

CIMB group CEO Tengku Datuk Seri Zafrul Aziz says the corporate segment has seen strong loan growth since the last quarter of the group’s financial year ended Dec 31, 2016 (4QFY2016).

“We are quite optimistic the momentum created in 4QFY2016 is sustainable. The corporate sector should be able to sustain the growth started last year,” Zafrul adds.

Moving forward, both the chairman and group CEO believe the outlook for the banking group has improved.

“The outlook for CIMB is better than it has been for some time now. The whole Asean platform — all the engines seem to be revving up in the right direction,” Nazir says.

Zafrul adds, “Given what we have done and the measures taken, we’re a bit more optimistic. We hope to achieve another record in revenue and growth in the top line but, at the same time, with corresponding improvement in profit this year. This is provided we ensure we control our provisions to the level  we expect this year. We expect provisions to be lower than they were last year.”

CIMB group registered a record revenue of RM16.1 billion in FY2016 while net profit came in at RM3.6 billion.

Nazir says the group will place more emphasis on the use of technology, as seen in its digital banking efforts in Indonesia and the launch of CIMB Enhanced Virtual Assistance (EVA) in Malaysia.

CIMB EVA is the first chat-bot banking application in Asean that was recognised as the “Internet Banking Product of the Year” by The Asian Banker’s International Excellence in Retail Financial Services Awards Programme 2017.

While CIMB Group is positive that the country’s economic outlook for this year is brighter, Nazir says the government still has much work to do when it comes to overcoming negativities that have caused the slump in the ringgit in recent years.

“Relative to peer economies, I think there is still work to do in terms of attracting more interest in the ringgit and investment in Malaysia. We’ve been through tough times in the past few years in relative terms. The government has work to do to overcome those negativities,” he says.

Nevertheless, Nazir says he is heartened to see corporates conducting roadshows to attract more investors, which indicates that they are coming back to the stock market.

When asked if CIMB Group’s recent introduction of 0% interest for up to five years on housing loans of no more than RM250,000 was to help employees battle the rising cost of living, he says the group is doing what it can to help. He urged the corporate sector to also increase its emphasis on corporate social responsibility if it could.

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