Affin sees stronger loan growth in H2
KUALA LUMPUR: Affin Holdings Bhd expects loan growth in the second half to come in stronger compared to the first half from January to June 2017.
Managing director and chief executive officer Kamarul Ariffin Mohd Jamil said that it had grown loans by some 2.5% in the first half and anticipated full-year growth to be at least 6%.
“We are quite comfortable to achieve a growth of between 6% and 7%, as growth in the second half will be stronger,” he said at a briefing after a prize-giving ceremony for the OMG Returns! yesterday.
He said the consumer segment would still lead loan growth this year, followed by corporations and small and medium enterprises.
“We are now more broad-based than before and have got growth from the consumers,” he said.
In a recent report, CIMB Research said the banking industry’s loans grew by a weak 1.8% on a year-todate basis until July, translating into an annualised rate of only 3.1% for this year.
“This was below our projected 5% to 6% loan growth for 2017. In view of this, we are cutting our projected loan growth for 2017 from between 5% and 6% to between 4% and 5%,” CIMB Research said.
The research house said growth in the industry’s loan applications and approvals improved significantly to 22.9% year-on-year (y-o-y) and 24.8% y-o-y, respectively, in July.
“Both were driven by the wider expansion in the segments for the purchase of big-ticket items – homes and vehicles.
“Nonetheless, applications and approvals for working capital loans only grew by a weak 2% to 3% y-o-y on July 17.
“Strong leading loan indicators could provide some cushion to loan growth in the coming months but y-o-y growth could still trend downwards,” it said.
Meanwhile, Kamarul said the bank’s plan for a reorganisation exercise under its Affinity programme would see Affin Bank taking over Affin Holdings’ listing status.
This corporate exercise is expected to be completed by the first quarter of next year.
Kamarul also said the bank was still on track and was awaiting regulatory approval to acquire Felda Global Ventures Holdings Bhd’s stake in AXA-Affin General Insurance Bhd.
“It is about a 7% stake and they are slated to sell their stake to either Affin or AXA-Affin,” Kamarul said.
Affin Holdings owns 36.9% of AXA-Affin General Insurance.