MIDF ... Sept 2008

It believes its strong financial results in 2007 will put the company in a good position to face the challenges faced by the banking industry this year.

MIDF saw pre-tax profit rise 33% to RM138.5mil for the financial year ended Dec 31, 2007 and said its focus on growing customer relationships, operational efficiencies, remedial management and cost rationalisation would provide the company with a strong base for sustainable and quality growth.

Nonetheless, MIDF has put into action an internal restructuring plan that aims to transform the company.

For this year though, MIDF’s investment banking division expects to conduct more debt and equity capital markets activities, backed by a suite of investment-banking related activities such as financial advisory, underwriting of equities and debt instruments, treasury activities and equity-broking services.

The investment banking division has been working to forge “smart partnerships and alliances with other market players as a means to enhance contributions from non-debt capital market related businesses such as corporate advisory activities and stock broking.

As for the group’s asset management division, MIDF was taking steps to enhance such activities by focusing on business and product development.

Opportunities for potential tie-ups with established foreign partners were in progress for the asset management business.

Turbulent times can also lead to more opportunities - MIDF’s development finance division recorded an increase in the number of soft loan applications from small and medium enterprises (SMEs) in the post fuel subsidy revision market. MIDF is a key provider of financing to SMEs. The interest rate on its soft loan schemes was reduced from 4% to 2%, and the ceiling for the margin of financing was increased to 90%.

With over 85% of SMEs are in the services sector, MIDF sees a lot of promise in this sector.