Bank Rakyat eyes MoU with BRI by year-end

KUALA LUMPUR: Bank Kerjasama Rakyat Malaysia Bhd (Bank Rakyat), which is targeting a loan growth of 5-7% this year, expects to ink a memorandum of understanding (MoU) with Bank Rakyat Indonesia (BRI) for a remittance partnership by year-end.
President and managing director Datuk Mustafha Abd Razak said it has established a working committee to look into the remittance collaboration with BRI.
With the partnership, Indonesian workers in Malaysia can open an account with Bank Rakyat and carry out remittance and withdrawals, while Malaysians can also benefit through similar services at BRI.
"There are 2.5 million Indonesians working in Malaysia. If we can capture 10% of the market every month (250,000) where they do fund transfers, we'll get RM250,000 extra revenue," he told reporters after distributing bubur lambuk, a porridge traditionally eaten during Ramadan, to road users in Jalan Rakyat here yesterday.
"If everything goes well, we target to materialise the MoU by year-end and operations can start in January 2016," added Mustafha.
There are 20,000 automated teller machines (ATMs) across Indonesia, while Malaysia has 10,000 ATMs.
Meanwhile, he said Bank Rakyat is eyeing a loan growth of 5-7% this year, from 6.7% last year. Last year's loan growth amounted to RM3 billion, with the highest take-up coming from its personal loans.
On housing loan, he said the growth was 5% last year and it is "much better" this year because of the bank's marketing strategy.
"We try to get more customers. If we look at the industry, every month there is RM7 billion to RM8 billion of new housing loans approved so we try to capture this market," said Mustafha.
He also said the biggest challenge this year is to get customers, because "everybody is fighting for the same customers".
"We have products like credit cards, personal loans, housing loans and hire purchase and this is what the commercial banks are also doing," Mustafha said.
When asked if there is potential for Bank Rakyat to embark on an Islamic bank merger, he said this would depend on the opportunities and it is yet to decide.