KUALA LUMPUR (June 1): BIMB Holdings Bhd is expecting a 15% growth in assets for its wholly owned banking arm Bank Islam Malaysia Bhd for 2015, despite saying that it will be a very challenging year for the banking industry.
Hizamuddin Jamalluddin, chief strategy officer of the managing director's office, said the expected asset growth is based on the group's current balance sheet.
" will be a great challenging year for everybody. The expected growth for the banking industry is about 8 to 9%. But for Bank Islam, our managing director highlighted that we are looking at 15% growth [in terms of assets]. That 15% growth is based on the current size of our balance sheet.
"The greatest challenge today for the banking industry is to garner cheaper cost of funding. In the currently very-competitive environment, every bank is experiencing a compressed margin of income. This is where our three year corporate plan, which was introduced back in 2013, emphasised service excellence. We look to continuously innovate new products that will meet our customers' demands."
He added that in terms of loan growth, the group is expecting this year's growth to be similar to that of last year's.
Hizamuddin was speaking to reporters during BIMB's launch of three new term investment accounts under the Islamic Financial Services Act 2013 (IFSA).
The three products launched are the Special Investment Account Mudarabah (SIA Mudarabah), Waheed Investment Account Wakalah (WIA Wakalah), and the Al-Awfar Account.
Hizamuddin said being the first Islamic bank to offer such products that comply with the guidelines set by the IFSA, BIMB will be able to lead the expansion of the traditional role of Islamic banks from credit provider to investment intermediary.
"With the introduction of these innovative financial products, Bank Islam now provides a wider range of shariah-compliant investment options with differing risk-return profiles to our depositors and investors."
As at 2:30pm, BIMB (fundamental: 2.7; valuation: 2.2) declined 1.47% or 6 sen to RM4.01 for a market capitalisation of RM6.19 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. )