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PETALING JAYA: Malayan Banking Bhd (Maybank), which posted a net profit of RM4.35 billion for the first six months this year, sees the Overnight Policy Rate (OPR) to be the catalyst for the current account and savings accounts (Casa) expansion in the industry.

Its group president and CEO Datuk Abdul Farid Alias expects the key rate to change in 2023.

Farid believes the Casa will return to its normal pre-pandemic level but the change will not take place quickly.

“We have seen that the growth rate has slowed down somewhat and currently it is at 50% Casa ratio – the highest we have seen for a long time, which has helped us with borrowing cost,” he said at Maybank Group’s H1‘21 financial results press conference today.

“So now the question is how we will manage our liability portfolio, anticipating the changes that’ll happen in the future.”

Farid pointed out the high casa rate is due to the rate of growth for deposits has outpaced the rate of growth for loans, as companies are reining in their investment and even their working capital has seen a monthly reduction in the past 16 months.

Nonetheless, Maybank revealed that it has seen a growth in mortgage throughout the year, while auto loans has posted growth for the first quarter of this year. Its retail SME loans have also reported growth on the back of its digital retail SME scheme.

Outside of Malaysia, he noted that the US Federal Reserve fund rate is expected to raise its rate next year.

“In addition, the Fed is also expected to taper its bond buying program which will have an impact on the exchange rate.”

For the full year, Maybank has also maintained its GDP projection of 4.2% for Malaysia, higher than Bank Negara Malaysia’s revised estimate of 3-4%.

Farid elaborated that the bank’s economic teams had revised their forecast from 6.2% made earlier this year due to the lockdown announcement in June which will clearly have an impact on the economy. He believes the projection will be supported by the national vaccination programme, which is on track as close to 42% of the population are now fully vaccinated.

For Q2’21, Malaysia’s GDP jumped 16.1% compared to the same quarter of the previous year, although the country’s GDP fell 7.1% for the first half of the year.

For its second quarter ended June 30, 2021, Maybank’s net profit more than doubled to RM1.96 billion from RM941.73 million reported in the same quarter of the previous year attributed to a decline on impairment allowances, higher net interest income despite a lower other operating income and higher overhead expenses.

Revenue for the quarter fell 3.9% to RM11.34 billion from RM11.79 billion reported previously.

For the first half ended June 30, 2021, its net profit jumped 45.6% to RM4.35 billion against RM2.99 billion reported previously. Meanwhile, its revenue slipped 5.9% to RM23.56 billion from RM25.03 billion.

With that, the bank has declared a single-tier first interim dividend of 28 sen per share with an electable reinvestment portion of 14 sen per share.

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