EXIM Bank plans to enlarge capital base

EXPORT-IMPORT Bank of Malaysia Bhd (EXIM Bank) plans to almost double its capital base to RM730.5 million from the present RM380.5 million to undertake a wider scope of operations.

However, no timeframe was given.

A larger capital base would enable EXIM Bank, which had merged with Malaysia Export Credit Insurance Bhd last year, to manage the enlarge group’s lending and insurance businesses.

As a result of the union, EXIM Bank is now under the purview of the Finance Ministry.

“With a larger capital base, EXIM Bank is in a better financial footing to support Malaysian companies to undertake projects abroad”, EXIM Bank managing director chief executive Kamal Mohd Ali said in a statement yesterday.

Kamal also unveiled EXIM Bank’s five-years strategic direction to reposition the bank as a key financial services provider for the business community.

“We will focus on businesses that generate export and foreign exchange earnings via exports and Malaysian investment abroad,” he said.

In the year to December 2005, EXIM Bank’s net profit rose 55 per cent to RM83.4 million from RM53.9 million a year ago. Operating revenue grew 35 per cent to RM135.6 million.

“The growth was due to improved banking operations, significant recoveries of previous non-performing loans (NPLs), and less provision of bad and doubtful debts,” Kamal said.

Its gross NPLs in 2005 had improved to 12.7 per cent from 28.5 per cent in 2004. The bank had in 2005 approved RM1.2 billion worth of loans, a 51 increase over the previous year’s figure.

Last year, EXIM Bank had also insured 20 per cent more local exports to RM1.87 billion from a year ago.

Shareholders’ funds, had meanwhile, increased 52 per cent to RM464.9 million.

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