Maybank and CIMB reduce lending rate

Eddy said: I got a few loan originated by Public Bank Berhad (KLSE:PBBANK) and disappointed by the bank lack of responses to BNM reduction in OPR. Drop or not drop? Cakaplah. Kononly one of the efficient bank in the region, aiks.


It is in line with Bank Negara’s move to lower the OPR

KUALA LUMPUR: Malayan Banking Bhd and CIMB Group have reduced their base lending rates (BLR), effective from Dec 1, following the move by Bank Negara to lower the overnight policy rate (OPR).

Maybank said yesterday it had reduced its BLR by 25 basis points from 6.75% to 6.5% effective Dec 1.

Maybank Islamic Bhd’s base financing rate (BFR) would also be revised downward by 25 basis points from 6.75% to 6.5% effective Dec 1.

CIMB Group said CIMB Bank Bhd and CIMB Islamic Bank Bhd would reduce both their BLR and BFR by 25 basis points to 6.5% with effect also from Dec 1.

The two banking groups said their decision was made following Bank Negara’s move to lower the OPR by 25 basis points to 3.25%.

“It is a decisive step to the advantage of our borrowers as well as a means to spur economic and business growth for the various sectors,” Maybank’s president and CEO Datuk Seri Abdul Wahid Omar said.

He added that Maybank and Maybank Islamic would continue to review the market environment and provide customers more financial support in these difficult times.

CIMB Group’s group chief executive Datuk Seri Nazir Razak said the banking group decided to pass on the full benefit of the OPR reduction to its customers.

“This full pass-through of Bank Negara’s OPR reduction will help existing borrowers and also potential borrowers to contend with an environment of sharply moderating economic growth,” Nazir said in a statement.

“We continue to also welcome borrowers to engage us if they need to restructure their payment schedules.”

Nazir said CIMB Islamic also plans to provide more attractive Islamic financing rates to pass on the benefits of ample liquidity in the Islamic banking market.

Customers can expect to pay lower rates for Islamic financing compared to conventional loans at CIMB Group, he added.

Despite the lower lending rates, CIMB Bank and CIMB Islamic deposit rates remain attractive at up to 3.5% per annum, Nazir said in the statement.

The Association of Banks in Malaysia said Bank Negara’s decision to cut the OPR would lead to a lower cost of funds for banks.

The lower cost of funds would in turn reduce the cost of borrowings for consumers, the association said in a statement.

The association’s chairman, Datuk Seri Abdul Hamidy Abdul Hafiz, said: “Bank Negara Malaysia’s move to cut the statutory reserve requirement for banking institutions from 4% to 3.5% effective Dec 1 will also inject greater liquidity into the banking system, lower cost of funds and promote lending activities as the move will effectively increase the lending capacity of the banks.”

Earlier, Wahid said the banking group intended to open nine more branches in the next three years in Cambodia to strengthen its presence in regional markets.

Maybank has two branches in Cambodia and plans are in the pipeline to open one more early next year, he said at the launch of an electronic deposit system.

Public Bank offers gold investment account

Refer to my previous post

Public Bank offers gold investment account

KUALA LUMPUR: Public Bank Bhd has launched a new investment product, Gold Investment Account, that allows customers to purchase the purest available gold commodity in 99.99% fineness at daily prices in ringgit per gram.

Managing director Datuk Seri Tay Ah Lek said in a statement the launch of the product was in line with the recent rise in gold demand and to provide an alternative investment product for customers who wished to earn potentially higher returns.

“The account provides customers with the convenience of investing in gold without the hassle of keeping physical gold, as trading is carried out through a passbook,” he said.

Tay said the initial gold purchase quantity to open an account was 20g and subsequent minimum trading would be 5g and in multiples of 1g.

He said the account would not pay interest and the bank would keep the gold with an authorised custodian bank.

Tay said the bank would make available the physical gold in denominations of 100g, 500g and 1,000g should the customer required physical withdrawal of gold.

“A minimum 2g of gold are to be maintained by the customer to ensure the account remains active,” he said. – Bernama

Public Bank’s Q1 net profit surges 51% to RM717m

51% boost on net profit?!! Wait a minute, The percentage change is measured on a QoQ basis. Yuks, the journalist try to mislead or what?

Non interest income grew by 91%. Totally insignificant compared to the magnitude of interest income.

Total customer deposits rose at an annualised rate of 16.4% to RM144.5bil as at the end of March 2008. Careful here about the word "annualised", forecast is just mere forecast.

The business is improving but there is not need to exaggerating the relative ratios.
RM1 to RM2 resulting to 100% profit but it is just RM1.

I'm expecting the day when the interest rates/yields are so low, the market is so inundated with unutilized liquidity, strengthen inflations, weaken purchasing power, worsen credit spreads and blah blah, that's the time to increase my portfolio's explosure to banking sector, especially only after the subprime/CDO/CLO or whatever you called it meet their salvation days.

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Public Bank’s Q1 net profit surges 51% to RM717m
KUALA LUMPUR: Public Bank Bhd reported net profit of RM717mil for the first quarter ended March 31, up 51% from RM476mil a year ago.

Announcing the strong set of results on Monday, it said the net profit of RM717mil represented 29% of the market consensus of the 2008 full year net profit of RM2.47bil. Pre-tax profit rose 44% to RM971mil over the same period.

“The strong financial performance of the Public Bank Group was contributed by healthy growth in net interest and financing income and strong growth in other operating income, partially offset by an increase in operating expenses and higher loan loss allowances due to higher business volumes,” it said.

It said the Islamic banking operations reported a 17% increase in net interest income and net income of RM1.02bil, up 17%. This saw the Islamic banking operations surpassing the RM1bil mark for the first time.

It said the strong earnings growth was underpinned by continued strong expansion in both the Public Bank Group’s lending and deposit-taking businesses and improvement in asset quality.

Other operating income grew strongly by 93% to RM558mil from RM289mil a year ago.

Public Bank said the group saw a strong growth in its wealth management business, particularly the fund management business and bancassurance distribution under its 10-year regional strategic alliance with ING/Asia Pacific Ltd.

“In addition, a goodwill payment of RM200mil was received from ING during the quarter pursuant to this strategic alliance,” it said.

Highlights of the group’s Q1 results:

* Net profit attributable to shareholders increased by 51% as compared to the corresponding quarter ended 31 March 2007, contributed by strong growth of 46% in operating profit. * Annualised net return on equity for Q1 improved to 34.0% as compared to 26.3% for the financial year ended Dec 31, 2007.

* Earnings per share increased by 51% to 21.4 sen in the first quarter of 2008 as compared to 14.2 sen a year ago.

* Non-interest income grew by 93% during the quarter.

* Total loans and advances grew by RM5.6bil or an annualised rate of 22% during Q1of 2008 to reach RM106.6bil as at the end of March 2008.

* Total customer deposits rose at an annualised rate of 16.4% to RM144.5bil as at the end of March 2008. * Net non-performing loan ratio further improved from 1.2% as at the end of December 2007 to 1.1% as at the end of March 2008 and was about one third that of the banking industry’s net NPL ratio of 3.1%.

* The Group’s risk-weighted capital ratio remains strong at 12.2% as at the end of March 2008.