KUALA LUMPUR (Oct 7): Bankers in the country have reacted positively to Budget 2023, which was tabled by Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz in the Dewan Rakyat on Friday.
The Minister announced a record allocation of RM372.3 billion for the Budget, an increase of RM40.2 billion compared with the RM332.1 billion allocated for 2022.
Here are comments of top executives of banks on Budget 2023:
Datuk Khairussaleh Ramli
Group president, CEO of Maybank Group
Chairman of The Association of Banks in Malaysia (ABM)
Budget 2023 lays the foundations for fiscal reforms, starting with the shift to targeted subsidies. This must be complemented by sustainable revenue sources to reduce dependence on volatile commodity-related incomes and one-off tax revenues as seen in 2022.
Budget 2023 also highlights the latest measures that will be adopted by the banks in Malaysia to combat financial scams, this includes the migration from SMS One Time Password to a more secure authentication method for certain transactions including fund transfers and payments, change of personal information and account settings. Banks will also have a 24/7 dedicated complaint channel/hotline for customers to report incidents of scam/fraud. We also welcome the added spend under Budget 2023 to strengthen detection and reporting of cyber threats including the building of cyber forensic capabilities.
We also support the continued emphasis to drive the ESG and climate change agenda under Budget 2023, which is a key agenda for the Malaysian financial sector. ABM members have already agreed on a set of seven broad ESG principles for the Malaysian banking industry. This includes the commitment to achieve carbon net zero across the entire business and financed customer portfolio, incorporate ESG into governance and risk management, as well as the commitment to identify, mitigate and manage risks of modern slavery and human rights across the supply chain.
Datuk Abdul Rahman Ahmad
Group CEO of CIMB Group
We welcome the focus on initiatives that will benefit our youths, the B40 group and those who are self-employed or in the gig economy, as well as MSMEs, the backbone of our economy. This includes various tax incentives, grants and financing opportunities, which CIMB is proud to support via programmes such as Bank Negara Malaysia’s iTEKAD initiative. We believe the initiatives announced in Budget 2023 will ultimately help to promote a more broad-based and sustainable recovery.
We also laud the increase in the Amanah Saham Bumiputera (ASB) and Amanah Saham Bumiputera 2 (ASB2) investment ceiling to RM300,000, which will increase Bumiputera equity ownership and participation and, in the long term, help to secure their financial resilience.
In view of the growing prevalence of scams and fraud, CIMB welcomes the government’s initiatives such as the establishment of a National Scam Response Centre (NSRC). In line with the country’s sustainability agenda, we are encouraged to see the allocation for flood mitigation, highlighting the urgency of climate change adaptation.
Tan Sri Dr Teh Hong Piow
Founder, chairman emeritus, director and adviser of Public Bank Bhd
Budget 2023’s spirit of inclusiveness reflects the government’s promise of leaving no one behind. The government’s planned expenditure of a notably higher RM372.3 billion in 2023 with 37.2% allocated for programmes and projects under the social sector shows its resolve and commitment in reducing the income gap between the rakyat and the development gap among the States.
This will help ensure Malaysia progress successfully and sustainably as a nation. Issues like food security and preparedness for natural disasters were also addressed, in addition to infrastructure spending covering healthcare and education, and digital infrastructure to address development and digital gaps.
We laud the government’s renewed focus on sustainability-based initiatives in Budget 2023, with more emphasis given toward enhancing green investments for the development of low-carbon, resilient and healthy urban environments. To this end, the government’s higher expenditure of RM95 billion for development in 2023 will see allocations channelled to programmes and projects with high socio-economic impacts in line with the United Nation’s Sustainable Development Goals.
We are fully supportive of Budget 2023 which is expansionary but necessary in current times to sustain the post-pandemic recovery of the nation. We are confident that the continued partnership of the public and private sectors will enhance the resilience of our economy and strengthen our recovery, while enhancing the well-being of the rakyat.
Mak Joon Nien
CEO of Standard Chartered Malaysia
As a strong proponent for MSMEs to get access to financial support, the financing facilities of SemarakNiaga amounting to RM45 billion and the provision of RM9 billion worth of guarantee schemes by Syarikat Jaminan Pembiayaan Perniagaan (SJPP) will aid them in their recovery in the aftermath of the pandemic. The tax reduction rate in taxable income for the MSMEs to 15% will help alleviate their cash burdens in the current rising interest rates environment. The provision of RM92 million for the development of the Halal industry will boost the country’s halal export value.
The introduction of more efficient tax processes such as e-invoicing and Tax Identification Number (TIN) will elevate tax experience and reduce administrative burden for companies, particularly for smaller businesses. This new tax incentive framework will position Malaysia as an attractive investment destination in light of global tax developments.
As facilitators of cross-border trade, the introduction of an investment fund with an allocation of over RM1 billion is timely and will enhance Malaysia’s ability to continue attracting quality investments. We support plans to develop towns bordering our neighbours such as Thailand and Kalimantan with our international network and local market expertise as these will further cement the country’s position as a key trading hub in ASEAN.
Datuk Ong Eng Bin
CEO of OCBC Bank (Malaysia) Bhd
True to the mantra it trumpets, Budget 2023 is responsive, responsible and reformist, even if much more can and remains to be done. It is heartening to see the needs of the lower income and marginalised groups continuing to be attended to through an emphasis on their wellbeing. The reduction in personal income tax for those in the RM50,000 to RM100,000 income category is welcome news even as those in this group continue to face the hardships associated with the ever rising cost of living.
I am also delighted to see education continuing to be given priority through the increase in budget allocation to RM55.6 billion and the numerous forward-looking initiatives contained in the related plans; the commitment to creating job opportunities for those struggling to find one; and the emphasis on women empowerment. We hope that these will pave the way for further responsiveness and an even more responsible posture as we attend to the underlying needs of the nation as a whole so we can renew our journey toward becoming a developed and high-income nation, one where the needs of everyone regardless of social status is seen to.
Above all, the reformist agenda must be kept a top priority item. We have come through the pandemic together. Now, we must stay together. By keeping sustainability as an integral part of the equation, including through a strong focus on youth and development at grassroots level, we believe the correct signals are being sent out for our rebuilding efforts to thrive.
Mohd Rashid Mohamad
Group MD, Group CEO of RHB Banking Group
We welcome the expansionary nature of Budget 2023, which provides substantial support to ease the financial burdens of the targeted groups. This includes providing the much needed social assistance while maintaining the government's commitment in ensuring fiscal sustainability via the review of public expenditure and a plan to have a more targeted subsidy plan towards vulnerable groups.
Budget 2023 will increase the momentum for economic recovery with emphasis on structural reforms to strengthen its economic resilience, measures to support the growth of SMEs and priority sectors, as well as improve people’s well-being. Coupled with consumer spending related measures and targeted tax cuts for certain groups, this would result in multiplier effects on economic activity.
Datuk Sulaiman Mohd Tahir
Group CEO of Ambank Group
The Budget 2023 is indeed reflective of the government’s commitment to the wellbeing of the rakyat, in tandem with ensuring Malaysia’s stability amidst continued headwinds in the current economic landscape. The initiative to reduce taxable income for micro SMEs certainly bodes well, particularly within this challenging environment where many businesses are still recovering from the pandemic and are straddled with cash flow issues.
To continue unlocking growth potential and transform as future-ready businesses, it is vital that SMEs embrace digitalisation, while tapping into sectors with strong prospects. In line with this, the government’s establishment of a RM10 billion fund via Bank Negara to support the automation and digitalisation of SMEs, as well as the tourism and agriculture sectors is indeed timely and necessary.
As ESG standards continue to gain prominence in the international arena, the RM1 billion allocation under the Low Carbon Transition Financing Fund for SMEs will help to strengthen business resilience and sustainability while contributing to Malaysia’s aspirations towards net zero emissions.
Datuk Wan Razly Wan Abdullah
President and Group CEO of Affin Bank
We welcome the expansionary, well-balanced Budget 2023 aiming towards sustaining the country’s economic recovery momentum from the Covid-19 pandemic, against the backdrop of sluggish global economic growth and other external headwinds.
The more comprehensive and expanded direct cash assistance amounting to a total of around RM10 billion under Bantuan Keluarga Malaysia and Jabatan Kebajikan Masyarakat, will enable the targeted group to meet their most pressing needs according to their priorities, while also creating multiplier effects in the local economy.
We also applaud the RM200 million allocation by the government, which amongst other things will be utilised to promote and market our tourism industry — especially as international travel is expected to be on the rise with borders reopening across the globe. The growth of our tourism industry will in turn spur more demand for our local goods and services.
Get our comprehensive coverage of Budget 2023 here.