AMMB wants more clarity from new govt

KUALA LUMPUR: AMMB Holdings Bhd, which is positive of a better performance in the financial year ending March 31, 2019 (FY19) compared with FY18, has emphasised that it is not a government-linked company (GLC) and wants more clarity on the direction of the new Pakatan Harapan-led government.
Group CEO Datuk Sulaiman Mohd Tahir said it is positive on the way the new Malaysia is being crafted, but lamented that the direction of the government is something that will only be announced in the upcoming Budget.
“It’s important that we know what the government don’t want to do, like infrastructure projects or scaling down on some investments. But what needs to come clearly is what they want to do and they may have some (ideas) in mind in terms of focusing on people, transport, health or education. We hope in Q3 and Q4, we should see some clear direction and the market will pick up after that,” he told a press conference after its AGM today.
“AmBank has never been a GLC bank. We’ve always been a bank that fight and compete out there, from a positive standpoint. Hopefully it (the banking space) is not dominated by big GLC banks and it’s equal opportunity for banks like us,” said Sulaiman.
He said with the appointment of the new governor, policies with regards to Bank Negara Malaysia’s (BNM) stance, its handling of the economy and interest rates, will be consistent and similar to the previous governor.
“We don’t see any surprises, the focus will be on maintaining interest rates conducive for business. Tighter policies on governance and control by BNM will continue to run.
“The episode of 1MDB (1Malaysia Development Bhd) gave us a chance to improve our processes. We spent close to RM100 million. As we drive the new business forward, I know that I have strong compliance, systems and processes to manage the risks,” said Sulaiman.
He added that AMMB has been working with BNM over the last two years on 1MDB investigations and has been cooperating with the likes of the Malaysian Anti-Corruption Commission and the Royal Malaysia Police. With no new recent updates, he said AMMB has moved on to build the business.
Sulaiman hopes that AMMB’s profit for FY19 will be better than what was achieved in FY18, as it has managed its costs well.
“We did MSS (mutual separation scheme), restructuring, we changed the composition of our books and concentration that gives better NIMs (net interest margin). Revenue continue to rise by the fact that we focus on those areas that have double digit growth and offer us margin. If I maintain the costs, (minus) the one-off hit by credit cards and MSS, surely the profitability is better,” explained Sulaiman.
He said AMMB has witnessed a pick-up on its hire purchase business, but noted that it is a function of held back pent-up demand from the GST removal and forward purchasing, a temporary phenomenon.
Meanwhile, Sulaiman revealed that AMMB is expected to launch its e-wallet for QR code payments within next month and is partnering a telco for the cashless mobile payment system. AMMB has a merchant base of over 50,000.