theSun

| THURSDAY FEBRUARY 26 2009

13
896.51 1,616.79 13,005.08 2,206.00 2.44 2.35 206.56 5.92 Nikkei TSEC KOSPI S&P/ASX200 7,461.22 4,493.74 1,067.08 3,327.00 192.66 63.56 3.20 4.10

business

KLCI STI Hang Seng SCI

Public Bank to see reduced interest margin

KUALA LUMPUR: Public Bank Bhd, the countrys largest bank by market capitalisation, expects its net interest margin to be reduced by two to three basis points following Bank Negara Malaysias (BNM) move to cut the overnight policy rate (OPR). Chief operating officer, Leong Kwok Nyem, said overall, the bank expected a cut of 10-12 basis points in its net interest margins following the downward adjustments in the OPR by 150 basis points since November last year. Currently, the banks net interest margin is at 2.4%. Yes, our net interest margin is expected to be lower but the impact on the groups earnings would not be signicant, he told reporters after the banks annual general meeting yesterday. On Tuesday, BNM cut the OPR by 50 basis points to 2% amid concerns about the downside risks in the global economy. Economists believe the OPR rate reduction so far had been frontloaded, suggesting no immediate rate cut were needed. Leong said that the impact of lower margins would be offset by the reduction in statutory reserves requirement from 4% in November last year to 1% effective March this year. The narrow net interest margins would also be mitigated by the reduction in deposit rate and the large portfolio of the banks higher purchase loans where the lending interest rate is xed, he added. Leong also said Public Bank is aiming for a 15% loan growth this year but added that it could become a challenge to meet the target if the economy gets worse. However, we are still targeting the growth to be higher than whatever the industry growth rate is, he said. The Public Bank Groups total loans grew by 19% to RM120.7 billion as at the end of last year, well above the banking systems loan growth of 13%. Its domestic market share of loans had increased to 14.7% last year from 9.6% in 2003. Public Bank chairman Tan Sri Dr Teh Hong Piow said the management hoped to maintain its earnings momentum this year despite the current economic challenges. He said shareholders could also expect the banks liberal dividend payout to continue. Public Bank recorded a higher net prot of RM2.58 billion in the nancial year ended Dec 31, 2008, up 22% from RM2.12 billion in 2007 on the back of healthy growth in net interest income and other operating income. Its market capitalisation currently stands at RM32.37 billion and total assets amounted to RM196.2 billion as at the end of last year, which is more than three times the amount of RM64.6 billion in 2003. Bernama
MAHBs non-aeronautical revenue stood at a higher proportion against aeronautical revenue at 56.88% and 43.12% respectively. Total passenger volume at all airports grew 5.01% to reach 47.45 million for the 12 months, supported by a 5.12% growth in domestic passenger volume to 26.40 million and a 4.87% growth in international passenger volume to 21.06 million. Bernama

market summary
FEBRUARY 25, 2009 INDICES FBMEMAS COMPOSITE INDUSTRIAL CONSUMER PROD INDUSTRIAL PROD CONSTRUCTION TRADING SERVICES FINANCE PROPERTIES PLANTATIONS MINING FBMSHA FBM2BRD TECHNOLOGY TURNOVER 327.152mil CHANGE 5,881.35 896.51 2,113.14 283.12 66.73 166.56 118.24 7,116.75 526.82 4,376.46 231.01 6,097.76 3,992.77 12.73 +18.96 +2.44 +5.65 +0.45 +0.39 -0.19 +0.48 -0.36 -3.74 +13.31 UNCH +38.19 +10.78 -0.29

VALUE RM616.218mil

Bursa closes higher

SHARE prices on Bursa Malaysia closed higher amid buying interest in selected blue chips, dealers said. Gains on key heavyweights helped push the benchmark KLCI 2.44 points higher to close at 896.51. However, selling on nance counters capped the gains on the local bourse. This followed the 50 basis points cut on Tuesday in the overnight policy rate (OPR), which may affect the net interest margins and balance sheets of banks. Finance-based stocks Maybank and Public Bank decreased ve sen each to RM5.35 and RM9.10 respectively. According to dealers, interest in plantation counters was also a support factor for the local bourse in addition to healthy export gures. Among the gainers were IOI Corp which rose four sen to RM3.72 and United Plantations Bhd which increased 10 sen to RM10.80. The dealers said Telekom Malaysia, the most actively traded stock, further lifted the local bourse. Its shares gained 22 sen or 6.58% to RM3.56 after the company said it would return RM3.5 billion to its shareholders. Bernama

Yes, our net interest margin is expected to be lower but the impact on the groups earnings would not be signicant.
Leong Kwok Nyem

Malaysia Airports pre-tax prot soars

PETALING JAYA: Malaysia Airports Holdings Bhd (MAHB) has recorded its highest pre-tax prot since 1999 with RM432.44 million for the nancial year ended Dec 31, 2008, from RM404.89 million the previous year. Managing director Datuk Seri Bashir Ahmad said yesterday that the airport operators revenue also improved by 9.65% to RM1.51 billion from RM1.38 billion previously. This, he said, was mainly due to a 5.01% growth in domestic and international passengers as well as a higher contribution from the airport operations, retail, rental and agriculture businesses.

Resorts World posts loss of RM388.8mil

KUALA LUMPUR: Resorts World Bhd has posted a net loss of RM388.843 million for its fourth quarter ended Dec 31, 2008, a reversal from the pre-tax prot of RM344.094 million

in the same quarter the previous year. Revenue in the quarter grew by 16% to RM1,329 million from RM1,141 million previously, it said in a statement yesterday. The loss was due to the impairment of its investment in Star Cruises Ltd (SCL) of RM781.5 million, the group said. Excluding this impairment loss, the groups net prot would have increased by 14%, reecting a better underlying performance of its leisure and hospitality business, it added. For the year ended Dec 31, 2008, Resorts World posted a net prot of RM634.389 million, down from RM1.556 billion in the previous year. Bernama

Seoul to inject massive fund into banks

SEOUL: South Koreas nancial watchdog said yesterday it would start injecting a 12 trillion won (RM29.2 billion) fund into banks next month to shore up their capital base and encourage them to expand lending. The state-backed fund, to be used to buy subordinated bonds and hybrid debt from banks, would later be expanded to 20 trillion won, the Financial Services Commission said. It said the central Bank of Korea would inject up to 10 trillion won, the state-run Korea Development Bank would contribute two trillion won and other institutional and retail investors would provide the remainder. - AFP

HK says economy to shrink 2-3% this year

HONGKONG: Hongkongs economy will shrink by 2-3% this year, the rst annual contraction since the city was battered a decade ago by the Asian crisis, the financial secretary said yesterday. John Tsang offered a gloomy economic outlook for the southern Chinese nancial hub in his annual budget speech, saying consumer spending, exports and the property sector had also been badly hit by the global nancial crisis. Hongkong tumbled into recession in the third quarter of 2008, but the situation worsened in the fourth quarter. AFP