JAKARTA: Malaysia’s Malayan Banking Berhad (Maybank), the fourth largest lender in Southeast Asia, aims to enhance its business in international banking, including through its Indonesian subsidiary, so that it can have a stronger footing in the emerging region.
“To implement our regionalization agenda, we are expecting to enhance our businesses in Singapore and Indonesia, which are currently our largest contributors, but also in other areas, such as the Philippines and Greater China,” Maybank Group president and CEO Datuk Abdul Farid Alias said at a press conference on Thursday.
Maybank had about US$8.5 billion outstanding loans in its Indonesian branches — PT Bank Internasional Indonesia (BII) and PT Maybank Syariah — and almost $26 billion in its Singapore branch, according to the company’s 2014 figures.
The lender expects to increase the contribution of its international operation’s revenue to at least 40 percent of the group’s overall income this year, from 36.1 percent last year, according to Farid.
International operations recorded the highest year-on-year (yoy) revenue growth of 6.5 percent last year, helping boost its contribution to the group’s revenue from 34.4 percent in 2013, Maybank chairman Tan Sri Dato’ Megat Zaharuddin said.
Being a Qualified ASEAN Bank is one of the group’s strategic priorities to strengthen its grip in the region, Farid said, adding that Maybank expects to open a representative office in Myanmar sometime this year.
For its Indonesian branches, Maybank expects to increase lending by around 13 to 15 percent this year, within the domestic banking industry’s target range and higher than low growth from its banking operations in Malaysia and Singapore, between 9 and 9 percent each.
“We are expecting better productivity and efficiency in BII this year, while we are also eager to see a change in the Maybank brand in Indonesia,” he added.
Maybank has wanted to change the name of BII to Maybank Indonesia, although the plan has yet to be approved by Indonesian financial regulator and the government.
BII, one of the top 10 banks in Indonesia, saw its net profit halved last year to less than Rp 700 billion (US$54 million) as it struggled with bad loans.
Loans under the collectibility 5 categories — which are considered a loss — jumped more than three-fold to Rp 1.29 trillion within one year, forcing BII to allocate two times higher provisions for credit losses.
Overall, consolidated outstanding loans rose 4.2 percent to Rp 106.3 trillion last year.
“Our operations in Indonesia also experienced slower loan growth, especially in the corporate sector. On the other hand, consumer and business banking, namely the small and medium enterprise segment, remained a major engine of BII’s growth,” Farid said.
Shares in BII, which are traded at the Indonesia Stock Exchange (IDX) under the code BNII, closed up 1.51 percent on Friday to Rp 202 apiece.
