PETALING JAYA: Alliance Bank Bhd targets 8% to 10% loan growth for its full financial year 2024 (FY24), mainly driven by its core segments of SME and commercial banking, according to group CEO Kellee Kam (pix).
He noted that loan for its business banking segment continues to grow “at double digits”.
“We are seeing in FY2023, a pickup in momentum in our consumer business, which will then provide a good lift to our overall loan growth. In FY2023, we went through a de-risking exercise on our corporate book, we should also see the corporate business back to positive loan growth for the year.
“In a nutshell, we do believe SME commercial will continue to perform at the double digits, 12% to 13%, we then expect the consumer business to come up towards a single high digit (growth percentage) and corporate to also record a positive growth to come up to a total of 8% to 10% for the full year.
Furthermore, he said that it is focused on expanding its footprint regionally in Malaysia, particularly focusing in Sarawak and Penang. It aims to have 83 branches in operation by year-end and to date, it is in 79 locations nationwide.
“It will be a combination of both new locations as well as relocating certain locations that may be slightly out of place, to serve our communities. The branches remain one of our channels as we do have a fair amount digital propositions as well to supplement the growth in our heart locations,” he said.
On outlook, he noted that the Malaysian economy is experiencing moderation, from the previous year.
“We do still see very accommodative environment for businesses to grow and for banks to grow. Although GDP, we (expect to) see a slight slow down … partly from the basis of effect as well. We do expect that interest rates currently are still accommodative for growth.
In terms of challenges, he pointed out that the rising interest rate present a different challenge in ensuring the bank manages its loan books, customer engagement and keep delinquencies down.
“Cost of funding … and challenges in talent retention, upskilling our workforce to better accommodate the changes that we’ve seen in the digital arena are matters that we are looking into,” he said.
Meanwhile, CFO Ronnie Fernandiz said that the bank expect capex for FY2024 to be about RM116 million, whereby the bulk is allocated towards ”information technology modernisation and part of is Acceler8 strategy”, and it plans to undergo a so-called IT transformation within itself.
