Investment & Market Trends

KUALA LUMPUR: The Human Resource Development Corporation (HRD Corp) should take into account audit findings from the Public Accounts Committee (PAC) to beef up governance of its funds, said Malaysian Employers Federation (MEF) President Datuk Dr Syed Hussain Syed Husman. “We hope these audit findings will strengthen HRD Corp’s governance of the fund. We need better quality people in management, technology and better processes,” he explained. Syed Hussain was commenting on the PAC’s findings of weakness in HRD Corp management due to dubious real estate deals and high-risk investments. According to reports, the PAC also said there was no Bank Negara Malaysia representative in the investment panel, which is against the Human Resources Development Fund Act 2001. “As the funds are getting bigger, we need more competent investment-related people in the committee,” he said, adding that HRD Corp’s act allows them to set up an investment committee. Syed Hussain said that with better management and a better focus on training and development, HRD Corp will be one of its kind in the world. “As a member of the International Labour Organisation (ILO), we have not found any country that has set up such a fund. Malaysia is a leader in this area of talent development. “Hence, HRD Corp can only get better and become a role model for Human Resources development,” he added. Syed Hussain also noted that despite the ongoing investigation by the Malaysian Anti-Corruption Commission (MACC) following the PAC findings, credit should be given to HRD Corp for achieving a stable financial position, as acknowledged in the PAC Report 2/2024. HRD has recorded a cumulative profit of RM389.95 million as of 31 December 2022. Syed Hussain said that HRD Corp’s financial stability would help strengthen its human capital training programmes, which are needed by companies operating in Malaysia. — BERNAMA

KUALA LUMPUR: Alliance Bank Malaysia Bhd is optimistic that the banking industry is well-positioned to progress and navigate the potential headwinds with steady domestic fundamentals and an outlook that remains conducive to sustainable economic growth. In a joint statement by Chairman Ahmad Mohd Don and Group Chief Executive Officer Kellee Kam, Alliance Bank will continue delivering on commitments to putting the customers first with greater value propositions and innovative digital transformation, while remaining adaptable to the changes within the operating environment to fulfil growth ambitions under Acceler8 strategy. “Through the Acceler8 strategy, we diversified our portfolio, gaining access to new markets and consumer segments. “In the financial year 2024 (FY24), we successfully grew the overall bank loan market share from 2.41% in FY23 to 2.58% in FY24, driven by higher loan volumes in the small and medium enterprises (SME), consumer and corporate segments,” they said in the bank’s annual report 2024. They also said the bank focused on efforts to tap into new market segments and business verticals, regional expansion, championing sustainability, as well as driving synergies and value creation through digital innovations and partnerships. On becoming the regional champion, they noted that the bank focused on strengthening its market presence and reach across the country, particularly in key economic growth corridors such as Penang and Sarawak in FY2024. “By becoming the preferred ‘Bank for Life’ to consumers, businesses and local communities that we serve, we recorded strong growth of 48% year-on-year (YoY) in deposits and 18% YoY in loans across these states,” they said. They also said Alliance Bank will continue reinforcing its core business segments in these geographies, with Johor being added as one of the key focus areas in FY25. “Our regional expansion plans have been progressing successfully with the opening of new branches in Saradise, Kuching and soon at Jalan Kelawai, Penang.” they said. They said the bank will in FY25 continue to outfit and energise its branch network with the bank’s refreshed brand outlook to fortify the Alliance Bank’s positioning. — BERNAMA

KUALA LUMPUR: Kenanga Investment Bank Bhd has maintained its ‘overweight’ call on the banking sector, buoyed by improved economic prospects driven by infrastructure projects and investments. In a note, the investment bank said market tailwinds such as ongoing loan growth, gross domestic product improvement and better margin retention, are expected to continue overshadowing industry headwinds like inflationary pressures and a weaker ringgit. “We believe this will likely result in fewer challenges to the sector’s resilience. The sector remains appealing due to attractive dividend yields of six to seven per cent on most stocks, coupled with lower inherent sector volatility compared to other industries,” it said. Kenangas top picks for the third quarter of 2024 include CIMB Group, which has achieved a return on equity of approximately 11% and aims to sustain this growth long-term with a strengthened presence in both local and regional markets. Additionally, the research firm said CIMB boasts a dividend yield nearing mid-6% levels, the highest among its top peers. RHB Bank is also favoured for its expected leading dividends of 7% to 8% and the potential public entry of its associate, Boost Bank, which could attract significant interest in the near term. For small-cap banks, Alliance Bank Malaysia remains a favourite due to its solid fundamentals comparable to larger peers. Meanwhile, MIDF Amanah Investment Bank maintains a ‘buy’ call on Public Bank with an unchanged target price (TP) of RM4.78 as of 28 June 2024 when the stock price stood at RM4.02. The firm cites improving dividend payouts, anticipated major writebacks in the financial year 2024, as well as SMEs’ loan growth as supporting factors. Similarly, MIDF Research maintains a ‘buy’ call on Hong Leong Bank with an unchanged TP of RM21.38, with the stock priced at RM19.20 on 28 June 2024 noting its strong cost-to-income ratio and robust asset quality. Although HL Bank’s associate, Bank of Chengdu (BoCD) is expected to see moderated earnings, it remains a solid growth driver, MIDF said. Meanwhile, Maybank Investment Bank Bhd (Maybank IB) said the industry loan growth moderated to 5.8% in May 2024 from 6.1% year-on-year in April 2024, aligning closely with their full-year forecast of 5.5%. Maybank IB maintains a ‘positive’ outlook on the sector and recommends buying shares of AMMB Holdings, CIMB Group, Alliance Bank, Public Bank, Hong Leong Bank and Hong Leong Financial Group, in that order of preference. — BERNAMA

KUALA LUMPUR: The value of Malaysia’s halal exports reached RM54 billion in 2023, according to Minister of Investment, Trade and Industry Tengku Datuk Seri Zafrul Abdul Aziz. He said the industry plays a vital role as a catalyst for the country’s economic growth and the sector has tremendous potential to grow as the global halal industry, including both products and services, is expected to hit US$5 trillion by 2023. The minister said that the government is committed to increasing the number of entrepreneurs producing halal products and several approached have been taken, including the Jelajah Halal Malaysia (JHM) programme carried out by its agency, the Halal Development Corporation Bhd (HDC). “JHM aims to help MSMEs gain exposure to opportunities to penetrate domestic and export markets in the halal industry. “Since the JHM programme’s inception in 2022, more than 1,800 MSMEs have successfully participated in the programme,” he said in his speech at the JHM@Paya Besar event, which was also attended by Paya Besar Member of Parliament Datuk Mohd Shahar Abdullah. Tengku Zafrul said the HDC assisted 15 entrepreneurs in placing their products at the Mydin Tunjong Hypermarket through a business matching session at a previous JHM programme in Kota Bahru, Kelantan. Commenting on Pahang’s halal sector, he said the Department of Islamic Development Malaysia (JAKIM) has informed him that 158 companies in the state hold halal certification as at 1 July 2024. “Nevertheless, I am certain the (Pahang) state government and the Pahang Islamic Religious and Malay Customs Council (MUIP) have initiated various programmes to elevate food and beverage companies so that they can obtain halal certification,” he said. Tengku Zafrul also acknowledged that several locations have the potential to be developed and contribute to the economic development of their residents; the Ministry of Investment, Trade and Industry (MITI) is prepared to offer its services to improve the local economy, especially in the halal industry. Meanwhile, HDC chairman Khairul Azwan said Paya Besar is the first JHM event this year, and the following events will be held in Sabah at the end of July and Penang in October. He said the JHM programme is part of HDc’s responsibility to prepare entrepreneurs to expand their businesses until they are able to export their products to the global market. “This (JHM programme) is a platform for local MSMES to obtain the information and skills to expand their capabilities as a company that can grow beyond their current scope,” he said. More than 200 participants attended the JHM@Paya Besar, and local entrepreneurs were provided with the latest information on opportunities in the halal industry. They also received assistance in Islamic banking and takaful products, as well as information on halal certification and halal development and training. — BERNAMA

KUALA LUMPUR: Jirnexu Sdn Bhd, the parent company of RinggitPlus, announced a strategic transaction to acquire CompareHero, the Malaysian arm of MoneyHero Limited. The acquisition is expected to close in early July 2024. Being a pioneer in Malaysian fintech for over a decade, Jirnexu is the leading financial comparison and aggregator platform in Malaysia and this strategic move solidifies Jirnexu’s leadership in the country’s fintech space, enabling consumers to access financial products and services conveniently. This acquisition will allow Jirnexu to effectively expand its reach to serve a broader audience with its industry-leading proprietary technology, including a credit score-based recommendation engine. As part of the agreement, MoneyHero Group will retain an equity stake in Jirnexu, transitioning from an operator to an investor and maximising the value of its interests in Malaysia through Jirnexu’s growth. Apart from that, MoneyHero Group will reallocate resources to growth opportunities in its core markets to continue driving value to its shareholders. While RinggitPlus and CompareHero will operate as separate brands, the acquisition unlocks significant benefits for consumers: Personalised recommendations: Jirnexu’s proprietary technologies, including its credit score-based recommendation engine built into a WhatsApp chatbot, will be integrated into CompareHero, providing consumers with financial product recommendations based on the likelihood of approval. Streamlined application process: Jirnexu’s user-friendly WhatsApp chatbot will simplify the digital application experience for CompareHero users. Exclusive deals: Consumers can expect exclusive sign-up deals across both brands. During the agreement ceremony, Jirnexu Sdn Bhd Chief Executive Officer, Yuen Tuck Siew said, “This acquisition marks a significant step forward in our mission to empower Malaysians with the tools and resources they need to make informed financial decisions. By combining the strengths and expertise from both RinggitPlus and CompareHero, we are expanding our ecosystem for all things personal finance to better serve Malaysians.” Jirnexu has been a driving force in Malaysia’s fintech revolution since its founding in 2012, pioneering full-stack fintech solutions by developing XpressApply, a proprietary technology that streamlines the digital application process to improve efficiency and significantly reduce drop-off rates thanks to the enhanced user experience. Through its innovative solutions and a commitment to financial literacy, Jirnexu has empowered millions of Malaysians to make better financial decisions by providing access to valuable information, personalised recommendations, and a seamless digital application experience. Therefore, this acquisition reaffirms Jirnexu’s commitment to financial inclusion and innovation. It aligns with their vision of becoming the trusted brand in Malaysia’s financial solutions marketplace, solidifying their position within the fintech industry. Meanwhile, MoneyHero CEO, Rohith Murthy commented, “From the early stages of development throughout its time as part of MoneyHero’s portfolio of brands, CompareHero grew into one of the top personal finance comparison and aggregator platforms in the Malaysia market, second only to Jirnexu. “This transaction represents our renewed commitment to the Malaysian market, taking a long-term view with a more investor-based approach as we continue to drive shareholder value and make personal financial decisions easier for consumers every day.”