KUALA LUMPUR: Malayan Banking Bhd (Maybank) plans to disburse RM50 billion in mortgages and RM35 billion in SME loans in the next three years, said group president and CEO Datuk Abdul Farid Alias.
“Our approval rate for mortgage is 80% and the industry’s approval rate is 70%. The industry has been supporting the borrowers, especially those who needs to find a home,” he told a press conference after its AGM here today.
The bank disbursed RM12.2 billion in mortgages last year.
Its current loan size for the SME segment consists of RM24 billion from business banking and RM17.1 billion from retail SME.
This comes as the government has urged banks to be more flexible in lending arrangements, amid complaints about access to lending among local investors.
At the Invest Malaysia 2019 last month, Finance Minister Lim Guan Eng asked banks to be more flexible in terms of lending arrangements as there were many complaints of banks being conservative, given that they recorded huge profits last year.
Maybank achieved a record FY18 with a net profit of RM8.11 billion and wants to ensure that it remains well equipped to withstand any economic headwinds that may arise in the coming year.
On provisions and impairments, Farid said these are carried out according to the Malaysian Financial Reporting Standards 9, with validation from auditors and regulators.
“We gave a guidance on the group’s net credit charge-off of about 40bps for 2019. Last year, the guidance was 40-45bps but we had recoveries and achieved better. From the group’s perspective, we haven’t changed our guidance,” said group CFO Datuk Amirul Feisal Wan Zahir.
Farid said it will plan the bank’s growth strategy against its expectation of how the economies in its major markets Malaysia, Indonesia and Singapore will perform.
He said Malaysia is projected to see gross domestic product growth of 4.7%, Indonesia 5.1% and Singapore 1.8% this year, driven by domestic demand. It is assuming that net external demand is going to be muted due to the US-China trade dispute.
“We should be able to grow based on the growth in the countries. Inflation is still low and asset quality is stable in all three markets, so the condition to do well relative to this environment is there,” explained Farid.
To support Maybank’s continued growth, five priority areas have been identified for this year namely, driving income growth, ensuring better productivity, managing asset quality, sound liquidity & capital management as well as digitalisation.
On the proposed additional capital requirement for domestic systemically important banks (D-SIB), Farid said Maybank’s capital is adequate and “within expectation”.
Bank Negara Malaysia is seeking public consultation on the proposed designation of D-SIBS and the implementation of higher loss absorbency requirements for them.
