Khairussaleh: We are working very hard to surpass what we did last year. Photo by Mohd Suhaimi Mohamed Yusuf
RHB group managing director Datuk Khairussaleh Ramli (left) with group chief financial officer Syed Ahmad Taufik Albar at a press conference here today.
KUALA LUMPUR (Feb 27): RHB Bank Bhd said it is cautiously optimistic of posting improved results for the financial year ending Dec 31, 2019 (FY19), after reporting record net profit of RM2.31 billion for FY18, despite seeing some margin compression ahead.
RHB group managing director Datuk Khairussaleh Ramli said the group is working hard to beat its performance in FY18.
"We are working very hard to surpass what we did last year. We are cautiously optimistic that we can still grow our profit this year but that depends on many parameters including topline growth and provisions," he said at a press conference today.
He said growth for the year will stem from mortgages and SMEs, which had also driven the group's performance in FY18.
However, the group sees net interest margin (NIM) compression to remain going forward, as competition continues to be stiff in the Malaysian market. The bank reported NIM of 2.24% in FY18 and Khairussaleh expects a three-basis-point decline in FY19.
"With the competition and pricing that we see, we think there will continue to be pressure on our NIM. We see up to three bps NIM compression this year compared to what we had last year," he said.
He added that deposits are very competitive, especially in terms of retail deposits, as banks in Malaysia look to shore up liquidity as required under Bank Negara Malaysia's net stable funding ratio.
Khairussaleh said the bank is looking for a more holistic approach in competing for deposits, aiming to make transactions more convenient for users.
"Deposits are getting very competitive, especially in retail because the banks are all eyeing deposits from the segment to meet the liquidity requirements.
"We are taking a more holistic approach. One of the things we are doing is to launch a mobile banking app to make it more convenient for people to transact and allow us to have deeper customer penetration," said Khairussaleh.