CIMB TO FOCUS ON TECH, DATA SEGMENT
Lender allocates additional RM400m to improve bank ops, IT infrastructure
CIMB Bank Bhd will be more aggressive in investing in information technology (IT) and its bank operations in the financial year 2019 (FY19).
To this end, it has allocated an additional RM400 million on top of existing business-as-usual allocation of RM500 million.
Under the bank’s next five-year Forward23 blueprint, CIMB has set aside RM2 billion for improvement in the technology and data segment.
Group chief executive officer
Tengku Datuk Seri Zafrul Tengku Abdul Aziz said following the size of its capital expenditure this year, the group was anticipating a flat return on equity (ROE) growth for FY19.
“However, (ROE growth) would be better this year at around 12 per cent,” he said after the bank’s 62nd annual general meeting, here, yesterday.
Tengku Zafrul said the bank was upbeat on Bursa Malaysia’s full-year performance, with the bank planning to handle at least three initial public offerings this year, versus none last year.
“I hope positive announcements on the continuation of the East Coast Rail Link and Bandar Malaysia projects will boost the capital market.”
He said market correction in terms of cash flow related to emerging markets, as well as the knee-jerk reaction to FTSE Russell’s warning it might drop Malaysian government debt from the World Government Bond Index, had triggered the current capital market outflow.
“Performance in the bond market is still positive despite the recent sell-offs and I believe after (FTSE Russell’s) engagement with Bank Negara Malaysia, the government and market players, it will have a clearer view on the country’s performance,” he said.
Tengku Zafrul said investors would remain cautious and stay on the sidelines ahead of the FTSE Russell’s decision in September.
“They (FTSE Russell) need to take into consideration that Malaysia’s bond market is deep and if they were to take Malaysia out of the index, there are still other benchmarks that investors should refer to, a true benchmark that reflects Malaysia’s position,” he said.
Tengku Zafrul said contrary to market expectations, CIMB was expecting no cut in the rate.
CIMB has maintained the country’s economy growth forecast at between 4.5 and 4.7 per cent this year, with the ringgit to strengthen to 4.10 against the US dollar.