EXIM BANK RETURNS TO THE BLACK

KUALA LUMPUR, April 8 - EXIM Bank Malaysia Bhd, which registered losses at the group and bank level in 2007, is expected to return to the black for the year ended December 31, 2008, says Chief Executive Officer Mohd Fauzi Rahmat.

“We are coming back to the black in 2008 but I can’t reveal the figures as we are still waiting for approval (from Bank Negara),” he said.

For the year ended December 31, 2007, EXIM Bank posted a pre-tax loss of RM64.195 million as compared to RM88.063 million pre-tax profit in 2007. Revenue was RM200.018 million vis-a-vis RM190.412 million previously.

At the group level, pre-tax loss in 2007 stood at RM64.224 million against RM95.043 million in 2008.

Non-performing loan (NPL) rate was also higher at 24 per cent in 2007, he told reporters after a signing ceremony between EXIM Bank and Asian Finance Bank Bhd for a RM55 million term financing.

The NPL rate for 2008 remained high but declined to reveal the figures.

In 2008, the bank approved RM850 million in loans, of which 40 to 50 per cent are expected to be recouped this year.

“Most of the projects are medium-term financing, so we expect a gradual draw down,” he said, adding that in the first quarter of 2009, it sanctioned RM300 million loans and expect approved loan amount to surpass RM1 billion this year.

“We are already looking at potential projects throughout the world worth RM5 billion and all will be approved but not all this year,” he said.

Fauzi said RM500 million is expected to be raised from Islamic financing for the projects.
EXIM Bank’s lending capacity is RM5 billion and it has been very prudent in disbursing the money, he said.

Fauzi urged Malaysian exporters to continuously explore new markets as “global trade is shrinking and it is anticipated to slide by 20 per cent this year, but one must know that trading activities will never stop.”

EXIM Bank did RM1 billion worth of trade financing last year.

“The bank’s focus now is in the markets where Malaysian companies and entrepreneurs have a competitive advantage particularly in Asean, North Asia and Middle East countries.
“We are also growing in the African continent and other selected markets,” he said.

To further expand its reach, the bank has introduced Islamic banking services for selected products, beginning with trade and project financing, he said.

Hence, EXIM Bank is expected to launch two or three Islamic financing products this year.

“The bank is also working on three construction-related financing deals in the Middle East worth a few 100 million ringgit but I can't reveal the details as it involves foreign parties,” he added. – Bernama