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Kuala Lumpur, 19 May 2012 – Kuwait Finance House (Malaysia) Berhad (KFH Malaysia) is poised for further growth as the Bank achieved a profit before tax (PBT) of RM23.1 million for the first quarter of financial year 2012 compared with a loss before tax (LBT) of RM40.8 million in the previous year’s corresponding quarter.
Cumulatively for the financial year ended 31 December 2011, KFH Malaysia registered an operating profit of RM52.5 million. Turnover increased to RM460 million compared with RM448 million in 2010, while deposits from customers also grew to RM4.7 billion from RM4.5 billion last year. However, this was offset by the Bank’s provisioning exercise in dealing with legacy accounts, due to which KFH Malaysia reported a loss after tax of RM596 million.
Dr Nabeel Al-Mannae, Independent Non-Executive Chairman and Director of KFH Malaysia, said, “This was a necessary approach for the Bank to adopt in order to remain on track to write-off the last traces of legacy matters while maintaining prudent quality management. While the full year results for 2011 reflect a loss, we are confident that our strategy is bearing fruit given the operating profits achieved as well as the positive results recorded for the first quarter of FY2012. We look forward to continue offering our innovative range of products and opening new branches in the year ahead.”
The Bank continues to be well-funded and capitalised. As at 31 December 2011, the Tier-1 capital of KFH Malaysia stands at RM1.19 billion and the Tier-2 capital at RM366 million. This brings the total capital base to RM1.56 billion, resulting in the Risk-Weighted Capital Ratio (RWCR) of the Group remaining strong at 18.4% which is well above the Islamic banking industry average of 14.9% as at 31 December 2011.
The Bank has geared up its overall efforts to strengthen the KFH Malaysia brand presence in the local market via its advertising and product campaigns. This has contributed towards the increase of brand awareness as well as to grow its retail and consumer banking business, which is an area that the Bank is currently focusing on.
The Bank’s retail business remained on course during FY2011 with a deposit growth of 35% and financing growth of 462%. KFH Malaysia expanded its retail network and geographical reach with the opening of four new branches. In addition, KFH Malaysia enhanced its other service channels, namely KFH Online Banking. On the corporate front, KFH Malaysia provided infrastructure financing by supporting the construction of Islamic religious schools in a strategic partnership with the state government of Johor.
In November 2011, KFH Malaysia was the recipient of the ‘Most Outstanding Islamic Consumer Product’ Award for the KFH Gold Account-i at the Kuala Lumpur Islamic Finance Forum (KLIFF) Awards. The product is the first Shariah-compliant gold account in Malaysia and has been well-received by Muslim and non-Muslim customers alike, with more than 7,400 account holders to date.
The Bank’s parent company, KFH Kuwait, is keen on ensuring that Malaysia becomes a regional hub for KFH in the Asia-Pacific region. The recent appointment of Dr Nabeel as the new Independent Non-Executive Chairman and Director of KFH Malaysia is vital in steering the Bank as an important platform to explore future growth opportunities for the Group as part of its Asia-Pacific expansion plans. Dr Nabeel served at the Central Bank of Kuwait in a career that spanned 21 years, during which he held numerous key positions, namely as Deputy Governor for a period of 10 years. He has also served as Board Member for various corporations in Kuwait, Bahrain and Jordan.
In addition, KFH Kuwait’s Board of Directors recently rolled out a new five-year strategy and transformation programme designed to raise the bank’s performance to the next level. The programme will focus on three strategic pillars, namely improving the Bank’s performance in Kuwait, streamlining the Group’s investment portfolio and increasing coordination across its international banking subsidiaries. The strategy will include the enhancement of the Bank’s international presence for greater efficiency and increased synergy across its banking operations in Malaysia, Turkey and Bahrain.
Dato’ Jamelah Jamaluddin, Chief Executive Officer, KFH Malaysia, said, “We have the continued backing of our parent as well as customers, stakeholders and regulators that have supported us over the years. We remain fully committed to our transformation exercise and will continue to take the necessary measures to improve our asset quality for a healthy balance sheet.”
"By upholding strict corporate governance on impairment of assets coupled with adherence to Islamic finance principles, rigorous asset quality review and stringent credit control, KFH Malaysia is confident on delivering enhanced value to its customers moving forward, InsyaAllah,” concluded Dato’ Jamelah.
Cumulatively for the financial year ended 31 December 2011, KFH Malaysia registered an operating profit of RM52.5 million. Turnover increased to RM460 million compared with RM448 million in 2010, while deposits from customers also grew to RM4.7 billion from RM4.5 billion last year. However, this was offset by the Bank’s provisioning exercise in dealing with legacy accounts, due to which KFH Malaysia reported a loss after tax of RM596 million.
Dr Nabeel Al-Mannae, Independent Non-Executive Chairman and Director of KFH Malaysia, said, “This was a necessary approach for the Bank to adopt in order to remain on track to write-off the last traces of legacy matters while maintaining prudent quality management. While the full year results for 2011 reflect a loss, we are confident that our strategy is bearing fruit given the operating profits achieved as well as the positive results recorded for the first quarter of FY2012. We look forward to continue offering our innovative range of products and opening new branches in the year ahead.”
The Bank continues to be well-funded and capitalised. As at 31 December 2011, the Tier-1 capital of KFH Malaysia stands at RM1.19 billion and the Tier-2 capital at RM366 million. This brings the total capital base to RM1.56 billion, resulting in the Risk-Weighted Capital Ratio (RWCR) of the Group remaining strong at 18.4% which is well above the Islamic banking industry average of 14.9% as at 31 December 2011.
The Bank has geared up its overall efforts to strengthen the KFH Malaysia brand presence in the local market via its advertising and product campaigns. This has contributed towards the increase of brand awareness as well as to grow its retail and consumer banking business, which is an area that the Bank is currently focusing on.
The Bank’s retail business remained on course during FY2011 with a deposit growth of 35% and financing growth of 462%. KFH Malaysia expanded its retail network and geographical reach with the opening of four new branches. In addition, KFH Malaysia enhanced its other service channels, namely KFH Online Banking. On the corporate front, KFH Malaysia provided infrastructure financing by supporting the construction of Islamic religious schools in a strategic partnership with the state government of Johor.
In November 2011, KFH Malaysia was the recipient of the ‘Most Outstanding Islamic Consumer Product’ Award for the KFH Gold Account-i at the Kuala Lumpur Islamic Finance Forum (KLIFF) Awards. The product is the first Shariah-compliant gold account in Malaysia and has been well-received by Muslim and non-Muslim customers alike, with more than 7,400 account holders to date.
The Bank’s parent company, KFH Kuwait, is keen on ensuring that Malaysia becomes a regional hub for KFH in the Asia-Pacific region. The recent appointment of Dr Nabeel as the new Independent Non-Executive Chairman and Director of KFH Malaysia is vital in steering the Bank as an important platform to explore future growth opportunities for the Group as part of its Asia-Pacific expansion plans. Dr Nabeel served at the Central Bank of Kuwait in a career that spanned 21 years, during which he held numerous key positions, namely as Deputy Governor for a period of 10 years. He has also served as Board Member for various corporations in Kuwait, Bahrain and Jordan.
In addition, KFH Kuwait’s Board of Directors recently rolled out a new five-year strategy and transformation programme designed to raise the bank’s performance to the next level. The programme will focus on three strategic pillars, namely improving the Bank’s performance in Kuwait, streamlining the Group’s investment portfolio and increasing coordination across its international banking subsidiaries. The strategy will include the enhancement of the Bank’s international presence for greater efficiency and increased synergy across its banking operations in Malaysia, Turkey and Bahrain.
Dato’ Jamelah Jamaluddin, Chief Executive Officer, KFH Malaysia, said, “We have the continued backing of our parent as well as customers, stakeholders and regulators that have supported us over the years. We remain fully committed to our transformation exercise and will continue to take the necessary measures to improve our asset quality for a healthy balance sheet.”
"By upholding strict corporate governance on impairment of assets coupled with adherence to Islamic finance principles, rigorous asset quality review and stringent credit control, KFH Malaysia is confident on delivering enhanced value to its customers moving forward, InsyaAllah,” concluded Dato’ Jamelah.
