SME BANK POSTS RM67m PROFIT
Improvement due to higher contribution from banking operations, better investment results
SMALL Medium Enterprise Development Bank Malaysia Bhd (SME Bank) reported a higher pre-tax profit of RM67 million for last year, from RM48 million the previous year.
The improvement was attributed to among others, higher contribution from its banking operations and better investment results, said the bank in a statement.
The performance was supported by continued growth from gross income of the bank’s Islamic banking business, which grew at 15 per cent from RM292 million to RM336 million.
The bank’s net impaired ratio stood at 8.2 per cent, given its role as a Development Finance Institution (DFI), and within a single-mandated SME sector.
Efforts in bridging the financing gap as well as developing SME entrepreneurs have proven to be successful, with its financing portfolio recording a 12 per cent growth, or RM666 million, to reach RM6 billion last year compared to RM5.4 billion in 2015.
SME Bank also received approval to convert its RM500 million financing facilities extended by Ministry of Finance to equity, strengthening its paid-up capital to RM1.85 billion from RM1.35 billion last year.
“The presence of SME Bank as a key player among the six DFIs in the country is much stronger today, looking at the 38 per cent market share that it has garnered thus far,” said group managing director Datuk Mohd Radzif Mohd Yunus.
He said the bank has successfully migrated upwards 1,085 clients from its stable of 15,000 companies through its specific intervention activities.
The bank embarked on a fiveyear transformation plan in 2010, to undertake a major overhaul of its business model and processes.
The third stage of the transformation plan which is running, focuses on bridging the financing gap among the unserved and underserved segment of the SME entrepreneurs.
“In short, financial inclusivity is the main focus of the bank and reaching the target groups directly is the key to the bank’s success, and this is done through a structured and dedicated outreach programme which is the SME Bank XCESS,” he said.