KUALA LUMPUR, Feb 29 — Driven by the need to be selective and prudent amid a tough operating environment, Hong Leong Bank Bhd (HLBB) is cutting its loan growth target.
According to The Star, HLBB group managing director and chief executive officer Domenic Fuda said the whole industry is slowing and the bank emphasises good quality loan growth.
“It used to be a 4 to 5 per cent loan growth target and we are cutting it to 3 to 4 per cent for the entire year.
“Towards the end of last year, there were a couple of large corporate loans that were being paid as well – this is quite a sizeable portfolio for us,” he told at a press conference announcing HLBB’s first-half results yesterday.
Its loan growth in the first half of financial year 2018 recorded at 1.8 per cent year-on-year (y-o-y).
Meanwhile, its chief financial officer Foong Pik Yee said the automotive loan portfolio weighed on the bank's portfolio at RM17.3 billion but the mortgage segment posted a healthy growth of 9 per cent y-o-y to RM59.1 billion.
“The drop in the automotive loan portfolio was due to lower vehicle sales as well as the bank’s decision to compete selectively amidst the ongoing price competition, while total unsecured lending (credit cards and personal loans) was also lower to RM5.7 billion.
“For the small and medium enterprise segment, it registered a growth of 3.1 per cent y-o-y to RM20.8 billion. Also, domestic loans (Malaysia) represented 95 per cent of our total loans,” Foong said.
However, she said it was a very stable quarter with no significant stresses on HLBB's credit portfolio.
