PETALING JAYA: RHB Bank Bhd has set a loan growth target for 2022 at 4–5%, slightly lower than the industry average of 5.2% in anticipation of uncertainties that are affecting the country’s economy.
Managing director and CEO Mohd Rashid Mohamad said a 4–5% growth rate is more realistic at this juncture.
“The inflation and the OPR (Overnight Policy Rate) hike will have an impact but the continuous growth of the economy will neutralise the impact so people will come back to borrow,” Mohd Rashid told the media at the group’s Q1’22 results announcement and the launch of RHB’s 2022-2024 strategy today.
The group’s gross loans and financing grew 1.4% year-to-date to RM201.3 billion, mainly supported by growth in mortgage, small and medium enterprise and Singapore. Domestic loans and financing grew 1.0% year-to-date.
The group also unveiled a three-year strategy named Together We Progress 24 (TWP24) – with a new purpose statement of “Making Progress Happen for Everyone”. It centres on three objectives: be everyone’s primary bank, prioritise customer experience, and drive quality growth.
Several key targets have been set, including a return on equity of 11.5% and a cost-to-income ratio of ≤44.5% by 2024, as well as non-financial targets relating to digital, information technology, and analytics. The sustainability targets include mobilising RM20 billion in sustainable financial services and a financial inclusion target of empowering two million people by 2026 and for the group to be carbon neutral by 2030.
Mohd Rashid disclosed that TWP24 is set at a shorter period compared with its previous plan as the group needs to move quickly to adapt to the fast and ever-changing market environment and operating environment, in addition to the changing needs of customers.
“So, in a way to respond to that, we felt that it’s better to do a three-year rolling long-term planning rather than our traditional five-year plan that we have done prior to this,” he said.
Mohd Rashid commented that RHB’s exposure to foreign investment is currently still modest due to the weakening of the ringgit against the US dollar,
“I think the impact will be very minimal or near to nil for the group’s TWP24. Our focus is still on ringgit. Besides, volatility can sometimes help. We also advise customers in terms of how and when is the right time to hedge their exposure in foreign currency,” Mohd Rashid said.
RHB’s net profit for the first quarter ended March 31, 2022 decreased 7.69% to RM600.27 million from RM650.29 million in the same quarter a year ago due to higher taxes and lower net income. Revenue was lower at RM2.86 billion from RM2.90 billion a year ago.
Mohd Rashid previously served as RHB group treasurer from 2014 before being elected as the managing director of RHB group wholesale banking in July 2021. As he was internally elected as the group managing director and CEO effective April 1, 2022, Mohd Rashid said his leadership style will stay.
“My leadership is more inclusive and I make decisions collectively with the team. I’m open to feedback because that’s the way I believe I will progress,” Mohd Rashid said.
