Exim Bank sees more Saudi business via Al Rajhi partnership

Source From (Business Times): http://www.btimes.com.my/Current_News/BTIMES/articles/alraf/Article/

Published: 19 April 2012
By Zurinna Raja Adam

KUALA LUMPUR: Export-Import Bank of Malaysia Bhd (Exim Bank) hopes its partnership with Al Rajhi Bank Malaysia will double its business exposure in Saudi Arabia in the next two years.

Currently, businesses in Saudi Arabia, supported by Exim Bank, are mostly involved in hotel chains, which account for about RM60 million of its portfolio.

Besides hotels business, Mekah and Madinah are fast expanding and upgrading their infrastructure, roads, tunnels and public housing, which many Malaysian companies are keen to tap into.

"There is a growing interest by Malaysian companies to expand in Middle East, especially in Saudi Arabia. Our partnership with Al Rajhi will be able to support these companies," said managing director and chief executive officer Datuk Adissadikin Ali.

Yesterday, Exim Bank and Al Rajhi formed a strategic partnership on providing facility agency, security agency and other financing-related agency services for Exim Bank's customers with businesses in member countries of Gulf Cooperation Council (GCC).

Also present at the ceremony was Al Rajhi's chief executive officer Azrulnizam Abdul Aziz.

The pact will see both parties leveraging on each other's strength in assisting small- and medium-size enterprises and corporate in venturing and expanding their businesses overseas, particularly in GCC countries.

"Being the largest Islamic bank with a presence in Saudi Arabia, Kuwait and Jordan, Al Rajhi Bank is well positioned to assist Exim Bank in its role to support Malaysian businesses that want to penetrate the Middle Eastern market," said Adissadikin.

Businesses in the Middle East and North African countries form about 20 per cent of Exim Bank's portfolio, while about 60 per cent comes from the emerging markets in the Southeast Asian region.

This year, the bank expects to approve between RM5.5 billion and RM6 billion loans, or some 38 per cent, more than last year, encouraged by a strong growth momentum anticipated in 2012.

Last year, the bank approved about RM4 billion loans and has so far disbursed RM1.2 billion with the remaining RM1.8 billion expected to be disbursed this year.

The bulk of these loans is to fund construction projects, in addition to manufacturing and commodity trading.