Malaysia’s Asian Finance Bank turns around in 2011
KUALA LUMPUR, April 16, 2012
Asian Finance Bank (AFB) has staged a turnaround for its financial year ended Dec 31, 2011, posting a small profit, said chief executive officer Datuk Mohamed Azahari Kamil.
"The profit was contributed by the corporate banking sector and we will announce details of it soon," he said.
AFB had posted losses of about RM30 million for its financial year 2010 due to the provisions made for small-medium enterprises (SMEs) funding.
Mohamed Azahari said while the bank s corporate banking sector had contributed about 70 per cent to the profit for AFB s financial year 2011, the rest came from its retail sector.
AFB s new corporate banking model, which focuses on corporate advisory services and implemented by the bank early last year has been fruitful, resulting in the growth of its funded assets to RM1 billion now.
"We intend to grow this to RM1.5 billion by year-end. We are confident of success as we are focusing on the right business model," he said.
Under the corporate banking model, AFB will provide the financial bridging for Malaysian government-linked companies (GLCs) and public-listed companies (PLCs), looking for ventures in the Middle East, particularly, Qatar.
AFB, a full-fledged Islamic bank was incorporated on November 28, 2005. It is backed by a consortium of shareholders from leading Middle Eastern financial institutions, namely, the Qatar Islamic Bank (66.67 per cent ), RUSD Investment Bank Inc (16.67 per cent), Tadhamon International Islamic Bank (10 per cent) and Financial Assets Bahrain W.L.L (6.67 per cent).
The corporate advisory services adds value to the Malaysian institutions and this would eventually result in the AFB providing funding for the local conglomerates, Mohamed Azahari said.
"In addition to that, we are not just talking about funding but also looking into the possibility of increasing the value of the Malaysian capital market, by encouraging sovereign wealth fund from Qatar to participate as equity shareholders in bluechip companies in Malaysia," he added.
He said AFB planned to implement the model in other countries in the Asian region, especially, Indonesia and the Philippines.
He also said that AFB would continue to focus on its corporate advisory services and not expand its retail sector, including the funding of SMEs.
AFB recently relocated its branch in Johor Bahru to a more strategic commercial area in Taman Molek.
The bank has also obtained approval for branches in Penang and in Kuching, which will be its mini corporate office, and to be established by year-end.