THE merger of AmBank Group with RHB Bank Bhd, if successful, may fast-track the former’s goal of becoming a top four bank in the country by 2020.
AMMB Holdings Bhd’s (AmBank Group) merger talks with RHB Bank Bhd, if successful, will result in changes to AmBank’s blueprint to be among Malaysia’s top four banks by 2020.
AmBank chief executive officer Datuk Sulaiman Mohd Tahir suggested that the merger, if completed, could mean that the bank’s ongoing Top 4 strategy would have to be tweaked to reflect new targets.
“If the merger happens, it will fasttrack our plan of becoming one of the top four banks in the country,” he said after AmBank’s annual general meeting, here, yesterday.
“Assuming that the merger doesn’t happen, then we are still on track to hit our Top 4 ambitions by 2020.”
Top 4 refers to the group’s four-year plan, which began last year, to become one of Malaysia’s top four banks by focusing on 33 initiatives.
“We have just concluded our first year of the blueprint and we have achieved a good momentum towards our goal.
“We have seen traction in many areas, including digital transformation, increased deposits and cross-selling to close to three million customers.”
For the 2018 financial year, Sulaiman and his team are targeting to increase the group’s cost-toincome (CTI) ratio to 55 per cent from 57.4 per cent, as well as increase its return-on-equity to around 10 per cent from 8.5 per cent in the previous financial year.
“To hit our CTI target of 55 per cent, we are looking at simplifying our process and this involves redeploying our people and streamlining our processes. In terms of net interest income, we are well aware that there were fewer activities in the first quarter but the pipeline is looking good for the next quarter onwards.”
On the merger, Sulaiman is hopeful that both parties can finalise it by the exclusivity deadline on August 30.
“Both parties are allowed to speak to others from the end of this month to December.
“That said, if we do manage to close the deal with RHB during this exclusive period, we will be able to send in the papers to the regulators early next month for the next necessary steps.”
He said both banking groups would benefit greatly from the merger.
“It will enable us to be on a par with Malayan Banking Bhd and CIMB Group.
“What we are bringing to the table is our strength in Malaysia, while RHB is bringing its regional reach, which we currently don’t have,” he added.
Assuming that the merger doesn’t happen, then we are still on track to hit our Top 4 ambitions by 2020. DATUK SULAIMAN MOHD TAHIR AMMB Holdings Bhd chief executive officer
AmBank Group chief executive officer Datuk Sulaiman Mohd Tahir (centre) with group chief financial officer Jamie Ling (left) and group finance vice-president (business performance and investor relations) Ganesh Kumar Nadarajah at AmBank Group’s annual general meeting in Kuala Lumpur yesterday.