Kuala Lumpur: Tan Sri Abdul Halim Ali, the Chairman of Malaysia Building Society Berhad (MBSB) presented the performance of MBSB Group to shareholders at MBSB’s 39th Annual General Meeting held at Menara Yayasan Tun Razak, Jalan Bukit Bintang today.
Tan Sri Abdul Halim announced that MBSB registered an encouraging performance in 2008. MBSB recorded a Group pre-tax profit of RM54.0 million in 2008, which was an improvement of 24.6% over the previous year of RM43.4 million. Similarly, at company level, the pre-tax profit improved by 52.2% to RM63.9 million as compared to the previous year of RM 41.9 million.
He attributed the improvement was mainly due to the growth in net interest and financing income and other income arising from increased loan base, which was supported by increased deposit taking activities. The improvement was partially offset by higher other operating expenses.
MBSB Group’s total net loans, advances and financing grew by 12.3% to RM 6.8 billion in 2008. This was due to the continuing growth in mortgage loans of 17.0% in 2008, in particular the Islamic financing, which contributed 69.0% of the overall growth. Apart from mortgage loans, MBSB has been focusing on personal loans, which grew by 43.0% in 2008.
The NPL ratio for 2008 has remained at 23.0%, equivalent to the NPL ratio recorded in 2007. The general provision was 1.0% in 2008. MBSB will be enhancing the risk management capabilities in view of the current economic environment to improve the Group’s asset quality.
Total deposits as at 31 December 2008 increased by 17.0% to RM 6.3 billion as compared to the previous year of RM 5.4 billion. With the improvements in the key financial indicators, MBSB declared a first and final dividend of 3.0% less 25.0% income tax for the financial year ended 31 December 2008.
In order to remain dominant and competitive, MBSB continue to focus on product development and enhancement. As part of the growth strategy, MBSB has pre-launched the “PartnerHome-i” product which is based on the Musharakah Mutanaqisah Home Financing Concept. In addition, MBSB has also pre-launched the “Mudharabah Savings-i”, a general investment savings account based on the profit sharing concept. This product is aimed to encourage the habit of saving amongst the depositors.
As part of MBSB’s continuous development strategy, the Financial Process Exchange (FPX System), an on-line collection facility will be implemented in the near future to facilitate and to ease the payment process for our customers.
MBSB’s strategies to reach the customers have resulted in opening of new branches in Kangar, Taiping, Sandakan, Kemaman, Sitiawan and Tawau marking its 30 branches throughout Malaysia. Kulim and Bintulu have been identified to be opened in 2009.
We have also participated in The Talent Exchange Programme, coordinated by the Khazanah Nasional Berhad. The Exchange Programme was designed to enable an exchange of talents between the Government-Linked Companies.
CSR has been integrated into its business strategy and this is reflected through the launching of MBSB Home Safety Campaign with the theme, ”Our Home – The Safest Place”.
The campaign was launched in May 2008 and since then, talks and outreach programmes were held throughout Malaysia to educate and create awareness on the importance of home safety.
One of the achievements of the Campaign was the recognition by the Prime Minister’s Department of MBSB’s contribution in championing The MBSB Home Safety Campaign to the public. The award was presented during the launching of the National Crime Prevention Month in August 2008.
MBSB also contributes towards the improvement in education, particularly, in the rural areas. During the year, MBSB continued to monitor the progress of its two adopted schools in Bukit Mertajam, i.e. Sekolah Kebangsaan Machang Bubok and Sekolah Kebangsaan Bukit Teh, under the PINTAR school adoption programme. In addition, another 17 schools were also adopted. Counselling sessions, motivation and other related activities were undertaken to equip the students to prepare for their exams.
As a Government-Linked Company (GLC), MBSB will continue to implement the best practices in order to achieve our aspirations and objectives and also to transform MBSB into a high performance organization. In the Transformation Implementation Plan, MBSB was on track in its deliverables and has shown the following tangible results under GLC initiatives. The GLC Initiatives carried out during the year were:-
- Blue Book (Intensifying Performance Management) Implemented the reward system to the individual staff scorecard.
- Red Book (Procurement Guidelines and Best Practices) Implemented the first module of the E-Procurement System
MBSB have also implemented the Vendor Development Programme, comprising of the Bumiputera Vendor Development Programme and the Strategic Supplier Programme. Small and medium Bumiputera enterprises would be selected and developed during the programme, to be at par with the existing companies in terms of competitiveness.
MBSB will continue to focus on the retail business, and we have identified Personal Financing and Home Mortgage to be the core retail programmes for the Company.
For 2009, the Management has structured certain strategic initiatives to penetrate the Personal Financing, Mortgages, Corporate Business and Recovery and Rehabilitation that should see significantly higher contributions of income in the future.
As part of its moving forward position in the corporate business, MBSB had launched the Islamic Finance Concept of Musharakah, namely MBSB Musharakah Joint Venture Programme.
To ensure that all the Projects under both Conventional and the Islamic business model programmes are critically evaluated and their viability enhanced, MBSB has set up a Project Management and Monitoring Department, whose task would be to manage, evaluate and monitor all the Projects financed or participated by MBSB.