Tuesday March 27, 2012
By SHARIDAN M. ALI
sharidan@thestar.com.my
Focus on financing, improving asset quality cited for good showing
KUALA LUMPUR: Bank Rakyat Bhd posted a record net profit for its financial year ended Dec 31, 2011, jumping 49.5% to RM2bil versus 2010.
Domestic Trade, Co-operatives and Consumerism Minister Datuk Seri Ismail Sabri Yaakob attributed the strong showing to the bank's focus on growing on its financing activities as well as improving its asset quality.
“Personal financing remains the core contributor to Bank Rakyat's bottom line, while the growth in income from its Islamic pawnbroking venture, Ar-Rahnu, and investing activities also contributed to the overall growth in profit,” he told reporters after Bank Rakyat's 2011 financial result briefing yesterday.
The largest Islamic cooperative bank in Malaysia's net income after profit distribution to depositors grew 6.5% to RM3.24bil last year compared with 2010.
“Income from financing increased to RM4.46bil from RM4.04bil a year ago. The bank also recorded a fee-based income of RM92mil last year,” he said.
From
left: Looking at a chart showing the record profit are Bank Rakyat
senior general manager of corporate services Yusof Abdul Rahman,
chairman Tan Sri Dr Syed Jalaludin Syed Salim, Ismail, Domestic Trade,
Co-operatives and Consumerism Deputy Minister Datuk Rohani Abdul Karim,
general manager finance Mustafha Abd Razak and Cooperative Commission of
Malaysia executive chairman Datuk Md Yusof Samsudin. “Asset quality also remained strong as at the end of December 2011, with a gross impaired financing ratio of 2.8%, in line with industry ratio of 2.7%,” he said.
The bank's total deposits grew 18% to RM58.51bil while shareholders' funds increased by 40.3% to RM8.35bil in 2011 against the previous year.
Bank Rakyat announced a total dividend of 20%, comprising a cash dividend of 15% amounting to RM330mil and bonus share dividend of 5% amounting to RM105mil for 2011.
In terms of financing balance, Ismail said it had increased by 9.3% to RM49.2bil last year against 2010.
For this year, he said Bank Rakyat still aimed to grow its net profit to RM2.1bil amid the sluggish economic environment and tighter banking guidelines.
“The growth target is supported by our strength in personal loans and our non-performing loans that are still quite low at 2.8%.
“The global economy was also not so good last year, but still we managed to record an impressive set of results. I think the public has great confidence in us,” he said, adding that the Ar-Rahnu business was also growing with good prospect.
The implementation of Bank Negara's new Guidelines on Responsible Financing came into effect in January this year.
Ismail said Bank Rakyat was also looking at a more balanced portfolio between personal and commercial financing.
About 91.4% of the bank's financing income came from consumer banking while commercial banking accounted for only 8.6%.
“We are also opening nine new branches this year all over Malaysia,” Ismail said. Currently, Bank Rakyat has about 134 branches.
On a new managing director, Ismail said the board had suggested a few names to Bank Negara and that the central bank was still deliberating on the matter.
“I hope to hear the decision soon,” he said.
Established in 1954, Bank Rakyat is an entity under the purview of the Domestic Trade, Cooperative and Consumerism Ministery.
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