AMMB says it’s open to further 1MDB-linked probe

: AMMB Holdings Bhd, which posted 14.5% lower earnings in the ended March 31, 2018 (FY18) versus FY17, is open to further probe on its past links to 1 Development Bhd (1MDB) but noted that it has been cooperating with the authorities for the last two years.

AmBank group CEO Datuk Sulaiman Mohd Tahir said the bank has not been called up by the 1MDB task force formed by Prime Minister Tun Mohamad to investigate 1MDB.

He said the bank paid a RM53.7 million fine and went through an improvement process, spending RM100 million on systems and processes, adding that it now has a more robust system going forward.

“We were the first bank in Malaysia that has been fined. For the last two years, we’ve been working closely with the regulators. If there’s anything that they want to find, it would have been found, that’s how we look at it,” he told a press conference after announcing its FY18 financial results here today.

“The names (of those involved in the case) reported… they’re no longer with the bank as of now. For us, it’s about building the new bank and how can we go forward.

“For us, this (1MDB case) was two years ago. If they (task force) want to (call up on us), we’re open. We’ve been with them for the last two years,” said Sulaiman.

Group CFO Jamie Ling said with the change in government and policies, it is more vigilant around the second-order effect of its clients as contracts may not be awarded.

“Our GLCs’ exposure is not as big as the other large banks but it’s just more of a credit vigilance perspective on our model and our portfolios, making sure we’re anticipating what could potentially occur and how we can assist our clients if they’re in a tight situation.”

However, Ling noted that at the moment the banks do not see stress in its current books and it has already stress-tested scenarios revolving around the election on what could happen.

Speaking on the priorities for FY19, Sulaiman said the bank remains committed to its aspiration to be among the top four banks in the country, with FY18 being a year of rebasing to provide the bank with a solid platform to grow in FY19.

For FY19, AMMB’s financial priorities will be centred on . It will focus on current and savings account growth as one of our key priorities. The bank is also maintaining its 6% and wants to grow the SME and mid corps segments.

BET300, a three-year efficiency initiative will help AMMB achieve its cost-to-income target of 55% in FY19. It will continue to keep a tight rein on cost, pacing investments while continuing to look for operational efficiencies.

For the fourth quarter ended March 31, 2018, AMMB’s net profit fell 24.5% to RM253.41 million from RM335.81 million a year ago mainly due to a one-off cost of RM146 million from its mutual separation scheme (MSS).

But its revenue rose 3.1% to RM2.21 billion compared with RM2.15 billion in the previous year’s corresponding quarter underpinned by its net interest income from growth.

For the whole of FY18, net profit fell 14.5% to RM1.13 billion from RM1.32 billion in FY17 due to a one-off cost of RM146 million from its MSS, retail operational loss of RM47 million and loan impairment reversal.

Revenue jumped 3.5% to RM8.58 billion compared with RM8.29 billion in the preceding year driven by net interest income.

Source: The Sun Daily

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