Friday 29 Mar 2024
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KUALA LUMPUR: Malayan Banking Bhd (Maybank) has trimmed its 2015 loan growth forecast to between 6% and 7% for its Malaysian operations — compared with its previous guidance of 8% to 9% — as the banking group expects a softer market in the second half of 2015 (2H15).

Maybank group president-cum-chief executive officer Datuk Abdul Farid Alias said the market in 2H15 will be moderating on consumer sentiment, as consumers have done some front-loading in the first quarter of the year before the implementation of the goods and services tax (GST).

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“In terms of loan growth, we expect to manage asset growth against this market condition. In line with this, we forecast group loan growth of 8% to 9%, Malaysian loan growth of 6% to 7%, Singaporean growth of 5% to 6%, and Indonesia of 10% to 13%,” said Abdul Farid.

He was speaking during a media briefing on the group’s performance for the first half of its financial year ending Dec 31, 2015 (1HFY15).

For 1HFY15, Maybank posted group loan growth of 11.1%, with its Malaysian loans expanding 4.2%, below the industry average of 7.2%.

“During the first half, our growth for the consumer side was very robust. But we noticed that the global banking side was growing a bit slower. This was partly due to our assumption on trade, and also partly because we decided to be more disciplined in our pricing and underwriting,” he explained.

Maybank posted a net profit of RM3.28 billion for 1HFY15 (+3.4% from 1HFY14: RM3.18 billion), while cumulative revenue climbed 5.8% to RM18.12 billion from RM17.12 billion.

The group said the better performance for the period came on the back of steady growth in net operating income in most of the bank’s business pillars, led by community financial services (CFS) which grew 11.6% in net operating income, followed by international banking (9.5%), global banking (7.2%) and insurance and takaful (2.3%).

In its second quarter ended June 30 (2QFY15), net profit was slightly higher at RM1.59 billion or 16.76 sen per share (2QFY14: RM1.58 billion or 17.47 sen per share), while revenue rose 2% to RM8.94 billion from RM8.76 billion.

The group also declared a single-tier dividend of 24 sen share, comprising a four sen cash portion and a 20 sen electable portion under its dividend reinvestment plan.

“Our results have demonstrated that there are sustainable business opportunities in the region which Maybank can tap. We intend to continue our various initiatives to build market share responsibly.

“At the same time, we will intensify our strategic cost management initiatives while adopting a more efficient capital management strategy to buffer against lingering impact from the volatility in the market,” said Abdul Farid.

Asked if the group is looking to expand through mergers and acquisitions, Maybank chairman Tan Sri Megat Zaharuddin Mohd said the focus now is very much on organic growth.

“At the moment, we have to pay more attention to organic growth, given the market turbulence. But market turbulence should also offer opportunities for inorganic growth, as there must be one or two companies out there that would not be able to survive this.

“I cannot be more specific, but we have revealed the countries we are looking at (greater China, the Philippines and Indochina). We will make the announcements when we are ready,” he said.

After releasing its latest quarterly and half-year results, Maybank closed 15 sen or 1.76% higher at RM8.65, bringing its market capitalisation to RM82.52 billion.

 

This article first appeared in digitaledge Daily, on August 28, 2015.

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