Shared prosperity is Malaysia's key message at Apec 2020

KUALA LUMPUR, March 20 — After more than two decades, Malaysia will be hosting the Asia Pacific Economic Cooperation (Apec) leaders’ summit in 2020, with the key message of shared prosperity. International Trade and Industry…

MIEA: Extend Home Ownership Campaign perks to secondary market

PETALING JAYA: The Malaysian Institute of Estate Agents (MIEA) has urged the government to extend the incentives offered during the Home Ownership Campaign (HOC) to first-time home buyers looking to buy from the secondary market.

“MIEA is very appreciative of the fact that the Finance Ministry has introduced new programmes to stimulate the primary market by focusing on first-time home buyers, however it is critical that we should not close the door to first-time property buyers by limiting incentives to only properties offered by developers,” it said in a statement today.

MIEA said that the stamp duty exemption on instrument of transfer, which has been extended from Jan 1 to June 30 this year for properties ranging from RM300,001 to RM1 million, be made available for first-time home buyers of secondary properties.

It also urged the government to offer the stamp duty exemption on instrument of transfer for loans up to RM1 million during the same period to this category of buyers.

“There are significantly more varieties of homes at affordable prices for first-time home buyers within the secondary property market. Based on this premise, we should allow for the exemption of stamp duties to cover the purchase of homes within the secondary market by first-time buyers,” it added.

MIEA has suggested that a “Rent & Buy Programme” be set up for this category of buyers, through a special vehicle or banks to help them in two areas namely funds for a down payment and loan eligibility.

“We also request Bank Negara Malaysia to study and implement a fair and equitable loan approval and streamlined process for first time buyers and/or set up a special revolving fund to fund these buyers.

“This will allow for a shift in the dynamics of the property market, not only allowing for the disposal of ‘overhang’ properties but also unsold completed projects that are vacant,” it said.

According to the National Property Information Centre, 80% of all residential property transactions nationwide are from the secondary market while the primary market makes up the remaining 20%.

As such, MIEA said that the secondary market is the “bedrock” of the property sector, which sustains the real estate market and provides the thrust for its sustained growth.

It also urged the government to provide support to the real estate fraternity and real estate firms to modernise through technology and digitisation, and proposed that a tax exemption be given to those who are keen to invest in digitisation.

VDA: German carmakers to invest €60b in electric cars and automation

FRANKFURT, March 2 — Germany’s car industry is to invest nearly €60 billion (RM277 billion) over the next three years on electric cars and automated driving, the head of the VDA car industry association said ahead of the Geneva motor show….

Standard Chartered’s 2018 profits rise despite setting aside fine cash

HONG KONG, Feb 26 — Standard Chartered’s pre-tax profit surged to US$3.9 billion (RM15.8 billion) in 2018, the bank said today, after previously warning it had set aside nearly US$1 billion for regulatory fines in the US and Britain. The…

Axiata’s exit from Singaporean market ‘not surprising’

KUCHING: Axiata Group’s recent exit from Singapore’s telco market by accepting the offer to sell its 29.7 per cent-owned equity stake in SGX-listed M1 Tlecommunications asset came as no surprise to analysts. Researchers at AmInvestment Bank Bhd (AmInvestment Bank) said that Axiata Group’s exit was expected, thanks to the increasingly challenging and competitive market conditions […]

Islamic capital market valued at RM1.88t for 2018, says SC

KUALA LUMPUR, Feb 18 — The Malaysian Islamic capital market for 2018 was valued at RM1.88 trillion, representing approximately 61 per cent of the country’s overall capital market, says Securities Commission (SC) chairman Datuk Syed Zaid Albar….

Axiata exits M1 investment for RM1.65b

KUALA LUMPUR: Axiata Group Bhd via its wholly-owned subsidiary Axiata Investments (Singapore) Limited has accepted the voluntary conditional general offer by Konnectivity Pte Ltd for the group’s entire stake in Singapore-based mobile operator M1 Limited for RM1.65 billion cash at the offer premium price of S$2.06 based on terms in the offer documents dated Jan 7, 2019.

The group will effectively divest its 28.7% stake in M1 and exit its investment in Singapore with an estimated gain of RM126.5 million from this deal.

Axiata’s investment in M1 commenced in 2005 and the company had steadily contributed to the group’s growth over the years with dividends amounting to RM1.1 billion in the last 10 years. Over that period, it had generated healthy dividend yields of 7% over the years.

Given the financial returns as well as its strategic benefits, Axiata has expressed its satisfaction with its M1 investment. The group also believes in the long-term future of the company despite the short-term industry challenges with the new entrant into the market.

“Axiata has been consistent in its view that the share price over the last year does not reflect the intrinsic value of the company’s long-term future. Nevertheless, Axiata has made the decision to accept the offer due to the need for capital reallocation and new priorities in line with its vision to be the next generation digital champion by 2022 and the investments required to achieve that. The group also prefers not to be a minority investor in a potentially privatised company, making the investment illiquid,” it said in a statement.

Over the past years, all of Axiata’s operating companies (OpCos) in the region have outperformed the market, in terms of revenue market share; some having done so significantly. The group said its OpCos are in the top two largest mobile company positions in their respective markets, with many of them being best performing companies in most financial metrics.

As such and given the achievements in their markets, the group noted that continued investments will be required to capitalise on the current momentum. This is in addition to supporting the transformation of all of Axiata’s mobile-centric OpCos into digital converged companies over the next few years,

while at the same time, continuing to provide moderate dividends to its shareholders.

These investments include the modernisation of the group’s IT and network infrastructure, digitisation of its operations across all functions and investments into new growth areas especially in home and enterprise segments, and to a smaller extent, its digital businesses.

Axiata also expects to participate in industry consolidation if opportunities arise, and possible acquisitions in new growth areas over the mid- and long-term in some of its footprint countries.

Axiata president & group CEO Tan Sri Jamaludin Ibrahim said it is actually not an easy decision for the group.

“We like our investment in M1 and believe in its long-term future. At the same time, we need to undertake a major reprioritisation and make better use of our capital to chart a new chapter for the group in line with our new vision whilst also further enhancing our shareholders’ value,” he said.

Berjaya Sompo to focus on improving efficiency

KUALA LUMPUR: Berjaya Sompo Insurance Bhd, which is aiming to grow its gross written premiums to RM1 billion this year from over RM900 million last year, is focusing on improving efficiency in 2019 leveraging on digital means.

Berjaya Sompo CEO Tan Sek Kee said with the detariffication of motor and fire insurance tariffs, it needs to look at ways to cut costs.

“We can’t keep on reducing the premiums, with costs remaining the same. It eats into our profit. We’re looking at digital as one of the means to grow the business and improve efficiency,” Tan told the media at a Chinese New Year luncheon today.

He said with digitisation utilising artificial intelligence and robotics, a lot of jobs are going away and banks have started processes to reduce the number of staff.

“We’re not looking at reducing staff at this stage but rather we want to maintain the same number of staff to grow our business in the fastest way. We started a new digital team to look into digital marketing,” added Tan.

He said Berjaya Sompo is on track to become one of the top five general insurers in Malaysia by 2023. It is currently the eighth largest general insurer in Malaysia as of the third quarter of 2018 with a market share of 5%.

Its chief distribution officer Stuart Chua said the market is challenging but growth will be driven by its bancaassurance partnership with CIMB Group Holdings Bhd as well as agency sales.

The insurer has 2,800 agents nationwide.

Digi net profit up to RM1.54b in FY18

KUALA LUMPUR, Jan 24 — Digi.Com Bhd's net profit rose to RM1.54 billion for the financial year ended Dec 31, 2018 (FY18) from RM1.48 billion in the previous year. Revenue increased to RM6.53 billion from RM6.34 billion, while basic…

CGC confident of approving RM4.6b guarantees and lending this year

PETALING JAYA: Credit Guarantee Corporation Malaysia Bhd (CGC) is confident of approving RM4.6 billion worth of guarantees and financing benefiting 9,800 small- and medium-sized enterprises (SMEs) in 2019 as it leverages on technology, despite missing its previous year’s target due to the review of infrastructure projects in the country.

President and CEO Datuk Mohd Zamree Mohd Ishak (pix) said CGC is targeting 20% growth in its business income to RM280 million in 2019, from its 2018 target of RM236 million, driven by guarantees, direct financing and asset securitisation deals.

“I’m fairly confident of achieving that (RM4.6 billion target for 2019). We want to reach out more via our iSME (SME online financing and loan) platform. That is one of the many ways we can achieve those numbers,” he told SunBiz in an interview recently, adding that CGC will also strengthen its alliance with banks, of which some deals are in the pipeline.

CGC missed its revised RM4.7 billion approved guarantee and financing target in 2018, but met 78% of it at RM3.68 billion.

The guarantee provider had in last year revised its target from RM4.9 billion previously, taking into consideration the latest economic landscape after several infrastructure projects were being reviewed.

Zamree admitted he was disappointed for not being able to achieve its 2018 target. “I know that we’ve tried our best. I understand there are factors beyond control and globally everyone is affected. Taking that into account, we did fairly well,” he said.

He said the broad strategy for CGC this year will be harnessing technology for it to be more effective in its outreach to SMEs, operational excellence, elevating brand awareness and optimising human capital.

Despite the change in government, Zamree said, the way CGC conducts its business remains the same, as SMEs will continue to be the backbone of Malaysia’s economy and, in relation to this, CGC’s role does not change.

“Our vision has not changed for us to be an effective financial institution (FI) dedicated towards promoting the growth and development of competitive and dynamic SMEs. That vision has been there for many years. When CGC was launched in July 1972, we aimed to reach a situation in which poverty or the lack of capital is no barrier to business. That is still relevant today.

“What changes is how we adjust ourselves with emerging trends, with disruptions within the economy as a result of technology,” explained Zamree.

He highlighted that CGC is on track in its five-year plan (2016-2020) and added digitisation in the plan in 2017 during a review.

CGC is working to enhance imSME, Malaysia’s first SME online financing and loan platform this year.

“We’re talking to FIs whereby we want to have straight-through processing from imSME to disbursements done by banks to reduce turnaround time. Currently it’s just a referral platform.”

imSME was launched on Feb 9, 2018 and serves as an online one-stop centre for SME loan/financing by providing an array of financing products and services that are offered by participating banks and agencies.

“To date, we have over 400 SMEs that have obtained financing from imSME totalling over RM45 million. It is encouraging,” said Zamree.

He disclosed that in the first quarter of this year, CGC will embark on partnerships with three FIs to provide assistance to those in the car industry, to help women entrepreneurs and to use big data in its lending activities.

Since its establishment, CGC has availed over 460,000 guarantees and financing to SMEs valued at more than RM70 billion.