KUALA LUMPUR (Sept 28): Hong Leong Bank Bhd (HLB) expects Malaysia’s economy to register a modest recovery this year as spikes in Covid-19 infections and the reintroduction of movement restrictions moderate what was expected to be a strong recovery, said HLB chairman Tan Sri Quek Leng Chan. 

In a statement in the group’s annual report, Quek however also highlighted there is growing optimism that an acceleration in the vaccination roll-out and a more favourable external environment will help underpin a more sustained recovery next year. 

“The bank is determined to support our customers through these uncertain times. We will keep on providing the necessary assistance to enable them to weather this storm, in tandem with ensuring that our products and services continue to meet their expectations.

“In looking ahead, we are confident that our prudent strategies and unrelenting digital focus have helped and will continue to help us manage the uncertainties and nuances related to the pandemic and the forthcoming post-pandemic era,” he said. 

Meanwhile, he also pointed out that the bank’s gross impaired loan ratio (GIL) improved to a new low of 0.46% against the backdrop of its expanding gross loans and financing, which saw a healthy 6.8% year-on-year (y-o-y) increase to RM155.8 billion in the financial year ended June 30, 2021 (FY21).

“The growth in loans and financing was largely due to our business customers signalling their optimism that a rebound in economic activity could be under way. Customer deposits in FY21 grew by 5.6% y-o-y to RM183.3 billion,” he said.

On the Islamic banking front, the group via Hong Leong Islamic Bank (HLISB) has been focused on expanding its presence, driven by digital strategies that engage customers through a multitude of services and products delivered through simplified banking journeys. 

“In the year under review, HLISB produced a healthy financial performance, with profit before zakat and taxation recording a growth of 10.3% y-o-y to RM524 million. 

“Gross Islamic financing assets increased to RM32.7 billion, a 9% expansion y-o-y, while the contribution of HLISB’s financing towards the bank remained healthy at 21%,” he said. 

At 4pm, shares in HLB were traded four sen or 0.21% lower at RM18.70, valuing the financial institution at RM40.54 billion.