Friday 29 Mar 2024
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KUALA LUMPUR (Aug 28): RHB Capital Bhd (RHBCap) said it will seek to grow from within or organically for now, rather than through mergers and acquisitions (M&As).

However, the lender does not rule out the possibility of a M&A, although it "must make sense in the form of being value accretive and complementary", said its chief executive officer and group managing director Datuk Khairussaleh Ramli.

"We believe that we can grow on our own at this point of time. What is key is to focus on our fundamentals, improving our businesses," he told a new conference to announce the group's first-half 2015 financial results today.

Khairussaleh reiterated that RHBCap has no current plans to enter into merger talks with AMMB Holdings Bhd, saying that the former would prefer to focus on its restructuring exercise and reframed strategy for now. 

"We have just reframed our strategy. We need to be executing this new strategy," he said.

Under its reframed strategy, RHBCap is to focus on value creation for shareholders, anchored to boost revenue, differentiating its customer experience and digital ecosystem and a more robust talent redevelopment programme. 

The group aims to achieve an annualised return on equity (ROE) of 13% in 2017 and 15% ROE in 2020.

RHB Bank Bhd, which is taking over RHBCap's listing status on the Main Market of Bursa Malaysia, is expected to list in January next year after completing a proposed rights issue to raise gross proceeds of up to RM2.5 billion, and internal reorganisation.

Meanwhile, RHBCap is targeting to achieve a loan growth of 6% to 7% for 2015.

“Overall we think the industry’s loan growth will be slower but for us, the second half (performance) will be better than the first half,” he said.

The group's gross loans for the first half of 2015 grew 9.2% year-on-year to RM144.7 billion. 

Commenting on the impact of the weakening of ringgit on the group, Khairussaleh said it is not fully affecting the bank as its exposure to US dollar is not substantial.

“Our dollar book (assets and liabilities denominated in US dollar) is less than 10%, about 8% to 9%. [Therefore,] we are not greatly expose to the volatility of US dollar,” he added.

RHBCap (fundamental: 1.5; valuation: 2.1) shares closed 4 sen or 0.62% higher at RM6.48 today, with 1.29 million shares done, giving it a market capitalisation of RM16.77 billion.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

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