Hong Leong Bank eyes SME business
KUALA LUMPUR: Hong Leong Bank Bhd is setting its sights on the country's small and medium enterprises
(SMEs) sector now that the merger with EON Capital has been
completed.
“If you look at the contribution of SMEs to the economy, ours is at about
31% and is projected to reach 41% by 2020. There is still a long way for our
SMEs to grow. In countries like Singapore, Hong Kong and Thailand, their
contribution to GDP is far larger,” the bank's chief operating officer of group
business banking Peter Chow told StarBiz at the sidelines of Invest
Malaysia 2012.
“We have set up 49 of our branches to be turned into SME branches and by
September we should have 51 of them,” he said, adding that 145 branches would
eventually be set up.
“In terms of coverage we have the edge over our competitors. SMEs' needs
are rather simple, such as term loans to buy machinery or for working capital,
so the key is a fast turnaround time.”
According to the bank's
group managing director and chief executive Datuk Yvonne Chia, the crux of the strategy was “for our people
to go down to the ground because the infrastructure will be there.”
“In many ways our SMEs have become global SMEs, which speaks very well
for the Malaysian business psyche. I've seen a lot of our clients reach that
calibre,” she said.
Hong Leong Bank ranks second in
Malaysia in terms of its branch network, and post-acquisition of EON Cap, the fourth
largest bank by assets and customer deposits.
Chia is also upbeat that the investments created by
the Economic Transformation Plan would have a spillover effect on the SME
sector.
“I hope to benefit from the supply chain, the mom
and pop businesses that will be hired as the subcontractors from the various
projects,” she said.
On Bank Negara's responsible
lending guidelines, COO of personal financial services Moey Tan explained: “The
new guidelines have definitely had their desired effect and have taken a toll
on consumer loans in general. I don't think we've seen the full impact yet, we
will see it in the next three to six months.”
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