KUALA LUMPUR: Hong Leong Bank Bhd’s artificial intelligence-driven collection agents have achieved a 15-fold increase in productivity while reducing costs by 86%.
Group managing director and CEO Kevin Lam said this was achieved using AI voice bots capable of handling up to 16 concurrent lines.
“We started it in the second half of our financial year, our AI-driven collection agents are equivalent to about 20 over human callers,” he told a media briefing for Hong Leong Bank FY 2024 (FY24) financial results today.
Lam said the bank expects a slight increase in its cost-income ratio for FY25 due to investments in AI technology.
“Which is why we have forecast a slightly marginally higher cost income ratio as we make these investments, but in the coming period we do believe that it will trend back to our guidance of about 40% cost income ratio,” he added.
For FY24, the bank’s actual cost-income ratio stood at 40.5%, with a target of approximately 41% for FY25.
Lam said Hong Leong Bank has implemented AI for its collection agents, telemarketers, and customer service agents. Currently its AI application is primarily focused on outbound calls, where the script and possible interactions are more controlled and predictable.
“For customer service agents, where there’s greater potential for cost savings, the AI is still in training. This is because customer inquiries can vary widely, requiring more advanced AI capabilities.
“The encouraging aspect is that generative AI is continuously learning on its own, improving and progressing every day and every hour as it is deployed,” Lam said.
In the last quarter of FY24 ended June 30, 2024, Hong Leong Bank recorded a net profit of RM1.03 billion, which is higher than the RM864.68 million in the same quarter last year. The bank’s revenue grew to RM1.48 billion from RM1.3 billion.
For the whole of FY24, net profit was RM4.2 billion, up from RM3.82 billion in the previous year. Revenue increased slightly to RM5.77 billion from RM5.69 billion in FY23.
The board announced a final dividend of 43 sen per share, bringing the total dividend for the year to 68 sen per share.
On prospects, Lam said the Malaysian economy expanded at an encouraging pace of 5.1% in the first half of 2024. “Growth outlook is expected to remain favourable going into the second half of the year, and likely to be in the upper range of the official growth forecast of 4% to 5% for 2024.”
Growth, he said, will continue to be underpinned by resilient domestic demand as the labour market continues to improve, while extended recovery in global demand provides an added impetus.
“Upside risks from potential spillover from the global tech upturn and faster project implementation, will likely mitigate downside risks from lingering geopolitical uncertainties and slowdown risks in China.”
Lam said that as it pursues the ambition to become the best-run bank in Malaysia, it remains committed and nimble in the execution of its 3 to 5-year strategic plan while reaffirming its commitment to its core values and prudent culture.
“Our focus has always been offering innovative products and customer-centric banking solution to customers that anchor on our brand promise of ‘Built Around You’,” Lam said.
In order to drive the growth of core businesses and build a strong Asean franchise in the backdrop of a dynamic business environment, Hong Leong Bank will focus on the execution of key strategic priorities to deliver sustainable outcomes.
“In our journey towards carbon neutrality, the Bank remains committed to implement environmental, social and governance strategies and practices while working together with all stakeholders to make a positive impact for our customers and the community,” Lam said.
