The bank is disbursing a total of RM480m to all its members

By AFIQ AZIZ / Pic By ISMAIL CHE RUS

BANK Kerjasama Rakyat Malaysia Bhd (Bank Rakyat) has declared a dividend of 16% for the financial year ended Dec 31, 2017 (FY17), compared to 15% distributed in the previous year.

Domestic Trade, Cooperatives and Consumerism Minister Datuk Seri Hamzah Zainudin said the bank is disbursing a total of RM480 million to all its members.

The improved performance was attributed to the increase in Bank Rakyat’s profit before taxation and zakat of 17.8% to RM2.05 billion from RM1.74 billion in FY16.

The bank’s revenue grew 5.7% year-on-year (YoY) to RM6.34 billion as a result of growth in both financing and investment.

Bank Rakyat chairman Tan Sri Shukry Mohd Salleh said financing grew 2.1% YoY to RM70.63 billion on the rise in the retail and corporate banking segments, mainly mortgage, hire purchase and business financing to cooperatives.

Cumulatively, residential and auto financing grew 25.1% YoY to RM7.98 billion. Cooperative financing rose 7.7% YoY to RM1.96 billion, while personal financing rose marginally by 0.6% YoY, or RM340 million.

“It is in line with our longterm strategy to reduce overall dependency on personal financing,” Shukry said.

The group’s financing loss coverage fell slightly to 112.3% last year from 123.5% in FY16.

Shukry said it is still better than the domestic industry average, which is 82.9%.

Total deposit grew 6.9% YoY, or RM5.34 billion, to RM83.24 billion, while current and savings account balance improved by 21.6% YoY, or RM0.89 billion, for the year.

Total assets grew by RM6.23 billion, or 6.3%, YoY to RM105.45 billion.

“The growth was driven by a solid growth in treasury assets of 16.3%, or RM4.3 billion, and from the expansion in financing activities of 2.1%, or RM1.45 billion.

“The growth in treasury assets was part of the group’s strategy to increase high-quality liquid assets to comply with the liquidity requirements,” he said, adding that the bank’s return of assets rose by 2% compared to 1.8% previously.

Group MD and president Datuk Zulkiflee Abbas Abdul Hamid said the group’s non-performing loan (NPL) stood at 2.2% at end-2017, a slight increase from 2% in 2016 and 1.9% in 2015.

“When you grow your asset, you also slightly experience some NPLs. A high portion of the NPLs came from our previous business financing portfolios such as the cooperate loan segment, which we are now running down,” he said.

“We are quite comfortable with the fact that the majority of our NPL portfolios are below 1%,” he added.

Bank Rakyat’s shareholders fund rose to RM16.63 billion in FY17 from RM15.23 billion in FY16, due to the increase in net profit for the year.

“For FY18, we expect to maintain a similar financing growth, focusing on the corporate segment — mainly the small and medium entreprises. We are seriously streamlining our assets and liabilities.

“We will likely be able to record a dividend between 15% and 16% this year,” Zulkiflee Abbas added.