This article first appeared in The Edge Financial Daily, on April 13, 2016.

KUALA LUMPUR: DRB-Hicom Bhd’s unsuccessful disposal of nearly half of its shareholding in Bank Muamalat Malaysia Bhd may lead the Islamic bank to a listing.

The bank’s chief executive officer (CEO) Datuk Mohd Redza Shah Abdul Wahid yesterday said getting Bank Muamalat to be listed is certainly an alternative for the shareholders to add value to their investment once market sentiment picks up again.

“The market is not right for a listing at the moment, but when the market turns, we will look at more alternatives for the shareholders.

“I wouldn’t say a listing is a definite plan, [but it is] an alternative that the shareholders have,” Mohd Redza told reporters after launching Muamalat Gold-i, a syariah-compliant physical gold bar for investors.

DRB-Hicom holds a 70% equity stake in Bank Muamalat; the central bank has instructed the conglomerate to trim it to 40%. The merger talks with Affin Holdings Bhd did not bear fruit in 2013, while the one with Malaysia Building Society Bhd to form a mega Islamic bank did not work out as well after negotiations fell through in February.

For the time being, he said Bank Muamalat is working on improving its performance and diversifying its product offerings, but it is mainly “business is as usual” as far as the management is concerned. Due to the softer economy, it will see a moderate loan growth in the financial year ending March 31, 2017 (FY17).

“For the last financial year, we had [a] growth of about 7%. Our growth will be moderate going forward. We expect profits to maintain as in the previous year, driven mainly by consumer financing and probably 30% to 40% from the corporate sector,” said Mohd Redza.

Bank Muamalat made a net profit of RM89.28 million in FY15, which was 41.09% lower than the previous year because of higher cost of funds and impairment charges. It had a total asset size of RM22.44 billion as at the end of the last financial year.

On the bank’s recently started wealth management business, its vice president and head of wealth management Nur Ain Ramli said the group wants to make the division contribute 10% to 20% of its revenue in three years.

The bulk of the revenue from this segment, she said, should come from its gold business. In FY15, gold products made up about 30% of the wealth management business, but Bank Muamalat wants to double the composition in FY17.

While the launch of Muamalat Gold-I was officiated yesterday, she said the product had been offered at all 61 Bank Muamalat branches since Jan 31. More than 80kg of the gold was sold since, representing transactions worth RM14 million.