RHB Bank assumes listing of RHBCap

KUALA LUMPUR: RHB Bank Bhd, which yesterday assumed the listing status of RHB Capital Bhd as the new financial holding company of the group, saw its share price jump 3.2% on the first day of trading, in the aftermath of Brexit.
RHB Bank closed at RM4.84 yesterday, 15 sen higher from its reference price of RM4.69 with 1.1 million shares changing hands. It traded at a high of RM4.88 and a low of RM4.56.
Group managing director Datuk Khairussaleh Ramli said it is still early to determine the exact impact of Brexit but Malaysia should be fine as the central bank is managing the country’s volatility, currency and reserves.
“Our key focus is to improve the fundamentals of the organisation, and one of it is the ROE (return on equity),” he told a press conference after RHB Bank’s listing ceremony here yesterday.
Khairussaleh said in the first quarter, the group’s cost-to-income ratio decreased to 48.5% from 56% in the last quarter last year.
“We projected cost-to-income ratio to be below 53% this year. We’re pleased that it has been below 50% and we believe we should target a cost-to-income ratio of below 50%.”
He said the banking industry continues to see challenges amid the global economic backdrop.
“One of the areas that we need to focus a bit more on is asset quality. There could be potential uptake in terms of the asset quality deterioration in the country,” said Khairussaleh, adding that RHB is in a good position to withstand any downside risks in terms of asset quality.
“We’re trying to manage our portfolio... not too aggressive on growth and look at areas for efficiency and productivity. We will make investments in digital fields.”
RHB will also continue to grow its SME business and build the affluent proposition in its retail business. Khairussaleh noted that while the market is volatile, the pipeline for its corporate investment banking business is still good.
On dividends, he said RHB will try to maintain a 20% to 30% dividend payout but cautioned that tougher regulatory environment and capital requirements could affect its plans.
Khairussaleh said the completion of the group’s corporate restructuring exercise has enabled RHB to be better capitalised for growth and to meet regulatory compliance. The group’s savings on interest alone would be RM169 million a year, while the career transition scheme done last year, will save the group RM180 million annually.