Bank Pembangunan to tighten credit policy

> Aims to cut non-performing loans ratio to single digit in two years’ time

KUALA LUMPUR: Bank Pembangunan Malaysia Bhd (BPMB) aims to tighten its credit policy this year in order to reduce its overall non-performing loan (NPL) ratio to a single digit, from the current 12%, in two years’ time, said its president and group managing director Mohammed Rafidz Ahmed Rasiddi.

“This year we are targeting to lower it (the NPL ratio) to maybe around 1011%, but for the two-year’ plan onwards its actually to (bring it down to) a single digit,” Rafidz added, noting majority of the NPLs are from the infrastructure and technology sectors.

“In terms of making sure that loan delinquency is lowered, we will ensure that our credit policy is tightened, oversee the character and financial performance of the borrower and (make) other credit evaluations,” he told reporters after the bank’s signing ceremony of a syndicated loan facility worth RM274 million with Agrobank and Ramly Group yesterday.

The signing ceremony, which is witnessed by Agriculture and Agrobased Industry Minister Datuk Seri Ahmad Shabery Cheek, is to assist Ramly Group in establishing a new factory complex fully equipped with automatic machines in Taman Perindustrian Halal Hub, Pulau Indah in Klang, Selangor.

The new production complex will be built in three phases with a total investment of RM1 billion and is expected to be completed by end of 2017.

Meanwhile, Rafidz said the bank is looking at loan growth of 5% this year, from RM26 billion loans disbursed as of December last year, with a push towards financing more infrastructure, maritime, oil and gas and technology sectors.

The infrastructure sector currently makes up about 85% of the bank’s loan portfolio.

“We are trying to increase the loan growth portfolio, but obviously this current environment is very tough for most banks to do that. But we are targeting to grow the loan about 5% this year and we are on target to do that.”

“We are looking to do more business with good track record companies and clients that we are familiar with, as well as doing loans with the right sector, which our focus is on the four mandated