MAY BANK initiates GROWTH ERA tOday

fOreIgn  MAYBANK  thIrd-lEg  dEEp  pEnEtratIOn  IntO  sIngapOre  BankIng  sEctOrs

vEry  serIOUs  thrEat  fOr  lOcal  sIngapOre  banks  ? ? ? ?

frOm thIs pOInt  Onward,

sIngapOre  banks  wIll  start  tO  shrInk  ? ? ? ?

Islamic banking in the heart of Geylang Serai

Julie Quek

juliequek@mediacorp.com.sg

SINGAPORE

The bank did not disclose the details of the new Islamic financial products at Friday’s launch but confirmed they were in the pipeline and formed part of its strategy to grow its Islamic banking business beyond its domestic market in Malaysia.

The new Islamic banking branch in Singapore is located in the heart of Geylang Serai, home to a large base of Muslims.

It is part of Maybank’s bigger plans for its Islamic banking unit as it aims to be the leading Islamic bank in Asean.

Malaysia’s biggest lender also said it hoped that earnings from outside its home country would contribute a higher percentage to its overall profits over the next five years.

Maybank chief executive Abdul Wahid Omar said: “The idea here will be to grow our profit to make up about 40 per cent from our international operations by 2015.”

Apart from the Asean region, the bank also expects demand coming from the Middle East, China and India.

Analysts say that oil-enriched Middle Eastern investors are attracted to Asia as the outlook for the United States and Europe remain sombre.

Mr Raj Mohamad, managing director of consultancy firm Five Pillars, said: “Asia is very well-positioned now to offer what is commonly known as Syariah-compliant products, to attract these monies from the Middle East.”

With about two-thirds of the world’s Muslim population in Asia, there is a huge potential for retail Islamic banking products to grow, analysts said.— Maybank Singapore has launched the first dedicated Islamic banking branch here and plans to roll out home loans and motor insurance products that are based on Syariah principles.

sIngapOre  ecOnOmy  at rIsk  Of  fInancIal  Imbalances

lIke  prOperty bUbble  and  hOusIng  UNaffOrdabIlIty

caUsed bY  keepIng  bOrrOwIng  cOst

(and bank  depOsIt  rates)  tOO  lOw

fOr  tOO  lOng  ?

and  fOllOws  JAPAN's  fOOt step  Of  ecOnOmIc  dOwn fall ?

M’sia refrains from rate hike as rebound cools

KUALA LUMPUR

Bank Negara Malaysia kept its benchmark overnight policy rate at 2.75 per cent, a decision that was predicted by the majority of economists surveyed by

Malaysia started raising interest rates before any other Asian central bank this year to reduce what officials said was the risk of financial imbalances caused by keeping borrowing costs too low for too longregion’s efforts to withdraw monetary stimulus introduced to counter last year’s global recession may slow as policymakers around the world take steps to shore up growth amid signs their economies are cooling.. The

Bank Negara’s decision to stand pat came amid government data yesterday showing Malaysia’s exports rose at the slowest pace in eight months in July, as weakening growth in the world’s largest economies damp demand for goods.

Overseas shipments climbed 13.5 per cent in July from a year earlier to 55.4 billion ringgit ($23.9 billion) after gaining 17.2 per cent in June. The export increase was led by higher shipments of electrical and electronics goods and commodities such as liquefied natural gas, refined petroleum products, palm oil and rubber.

Weaker-than-estimated growth in Japan and slowing expansion in the US and China, among Malaysia’s biggest markets, pose a threat to demand for Asian goods.

The country’s imports rose 18.1 per cent in July to 48.4 billion ringgit from a year earlier. The trade surplus widened to 7.01 billion ringgit from 6.04 billion ringgit in June. — Malaysia’s central bank yesterday left interest rates unchanged after three consecutive increases, in a move to support growth as the global recovery slows.Bloomberg. Others expected a quarter-point increase.Bloomberg

Banks

v      2QCY10 report card – Lower impairment allowances for loans help beat forecasts.

v      The 2QCY10 results coupled with BNM’s recent banking stats for Jul has helped reinforce our Overweight stance on the sector.

           

RM9.88