BANK SEMAKIN TERBEBAN

Saham bank-bank tempatan sudah lama merosot tetapi ia begitu ketara pada bulan ini. Banyak bank melapurkan keuntungan dibawah sasaran. Kesukaran mengutip hutang sudah terasa. Keadaan BSKL kini membuatkan bank semakin tidak berani menjamin pinjaman dengan saham sebagai kolateral. Pinjaman perumahan nampaknya lebih selamat.

Ekonomi kini semakin bergerak perlahan. Penggabungan bank bakal menyebabkan 10% tenaga pekerja atau 10,000 akan kehilangan kerja. Bank sedang tenat kerana hutang berbilion oleh kumpulan kroni Renong dan Lion yang begitu lembab untuk di susun kembali atau dilunas segera.

Renong, peminjam terbesar, berhutang RM20 bilion dan Lion, pengusaha besi terbesar pula mengheret bank dengan hutang sebanyak RM10.2 bilion.

PENGGABUNGAN KEDUA BAKAL TIBA

Menurut analis, keuntungan yang semakin berkurang oleh bank akan menyebabkan SATU lagi siri penggabungan bank. Siri Pertama telah menggabungkan 54 buah menjadi 10 kumpulan. Menurut persatuan pekerja bank (NUBE), terdapat 77,000 pekerja bank dan 17,000 dijangka tergugat. Tetapi kerajaan berpendapat 10% atau 10,000 akan terbuang.

Pendeknya syarikat kroni telah menghisap kecairan dana dengan hutang yang amat membebankan. Itu menyebabkan aliran tunai berkurang sehingga bank terpaksa digabungkan - jika tidak ia akan tenggelam. Bank kini dipenuhi oleh saham-saham kolateral yang semakin tidak bernilai sehingga keuntungannya berkurang. Sementara itu nasib 10,000 pekerja sedang terapung diawang-awangan.

KESAN KEPADA RAKYAT

Menurut Azman Yahya (MD Danaharta), Danaharta telah melangsaikan RM47.49 bilion NPL, dimana RM39.30 bilion dari institusi perbankan dam RM8.19 billion dari institusi pesisiran dan bukan perbankan.

Dari jumlah ini RM27.10 bilion adalah NPL Sime Bank dan Bank Bumiputra Malaysia Bhd. Sila maklum kedua-dua bank ini sudahpun terpadam..... tetapi gerangan yang meminjam masih tidak padam-padam. Lama-lama wang anda atau anda sendiri akan terpadam.

Ketawa bolehlah beramai-ramai tetapi bila menangis cuma seorang. Anda hanya perlu memandang ke Jepun dan Indonesia untuk menyaksikan demam yang menakutkan. Tadayo Honma, presiden Nippon Credit Bank membunuh diri kerana semua jalan lain terlalu pedih dan amat kontroversi. Di Indonesia, pengerusi IBRA, Edwin Gerungan berkerja dalam keadaan yang begitu membosankan walaupun dia seorang yang cukup cemerlang sebelum itu kerana asyik dikongkong oleh kroni yang banyak bersarang. Menutup lubang memanglah senang kerana rugi cuma bertukar tangan kepada rakyat yang tidak tahu depan belakang. Danaharta sendiri melabur dalam bonnya sendiri jika tidak pecahlah tembelang. Malah ia sudah tidak ingin menanggung hutang bank lagi. Kita sebenarnya sedang dan masih rugi - ia cuma dianjakkan beberapa tahun lagi. Bon-bon itu nanti akan menyebabkan letupan ngeri bila tiba masanya nanti kerana tiada sesiapa yang mahu membunuh diri...

[Rujuk

Fortune: Suicide in Osaka

Asiaweek: Siri TAG MT 34,35,36,37 : Tugas Yang Membosankan ]

-TJr Kapal Berita-

Securities Firms News

Wed, 21 Mar 2001, 1:47am EST

Malaysian Banks' Profit Declines May Induce More Mergers

By J.S. Dhaliwall

Kuala Lumpur, March 21 (Bloomberg) -- Malaysian banks, forced to merge into 10 groups by a central bank that plans to let in more foreign competition in six years, may find falling profits hasten the tieups, analysts and bankers said.

Banks, already reeling from the depressed values of assets pledged to them as collateral, are setting aside more for bad loans, as the slowing economy cuts demand for new loans and old loans become harder to collect.

Malayan Banking Bhd., the country's biggest lender, Commerce Asset- Holding Bhd., the No.2 banking group, and AMMB Holdings Bhd. have all reported a larger-than-expected drop in profit in the quarter ended Dec. 31.

``Competition for the retail market will be cruel and banks have to re-invent themselves to face the slowdown and foreign competition,'' said Nik Hassan Nik Mohd Amin, executive vice- president of Bumiputra Commerce Bank (M) Bhd, the commercial arm of Commerce Asset. ``Laggards will not make it by 2010, and that means 10 banks are just the starting point.''

Banks have until the end of May to announce earnings for the quarter ending March 31. Analysts and investors are concerned the rising provisions could be coupled with more bad news further into the year.

Loan Recoveries, Growth

``Rising provisions apart, the issues are banks' loan growth and a possible squeeze on margins later this year,'' said Scott Lim of CMS- Dresdner Asset Management Sdn., which has 350 million ringgit ($92 million) under management. ``We are in no hurry to buy'' Malaysian bank stocks.

Banks have seen assets pledged as collateral drop in value as the key Kuala Lumpur Composite Index slid by 37 percent from its peak of 1,021 in February last year. The Kuala Lumpur Finance Index, which tracks 63 banking and brokerage stocks, fell 21 percent last year against a 16 percent drop in the Composite Index. The Finance Index is down 8.3 percent this year.

Maybank shares have fallen 24 percent over the last year, Commerce Asset shares have declined by 39 percent and AMMB shares have dropped 58 percent. Maybank recently traded at 12.30 ringgit, AMMB at 3.04 ringgit and Commerce Asset at 6.40 ringgit.

Slowing Economy

Investors are concerned banks' earnings are likely to be hit by a slowing economy. Malaysia's economy grew at its slowest pace in 1 1/2 years in the fourth quarter of 2000 and the official forecast is for it to expand less than 7 percent this year -- from 8.5 percent growth last year. The Asian Development Bank forecasts growth of 4.9 percent this year for Malaysia.

That's hurting banks loan books.

Amirsham Aziz, managing director of Malayan Banking, said on Feb. 13 the lender was unable to recover its loans quickly enough as a weak stock market hindered efforts by debt-laden companies to pay back borrowings.

``We hope to see loans-loss provisions peaking,'' said Chen Kim Loong, who manages 250 million ringgit at Malaysian Assurance Alliance Bhd. ``The concern is that it will drag on longer than expected, which won't be good for the banks.''

Loans

Bankers also predict loan growth will slow.

Yeoh Beow Tit, OCBC Bank (M) Bhd.'s chief executive officer, said the bank will be cautious in issuing loans.

``We will continue to be selective and go for more low-risk categories such as housing loans,'' Yeoh said. The bank's net non- performing loans stood at 6.35 percent at the end of 2000 against 6.23 percent a year earlier.

Commerce Asset Executive Director Rozali Mohamed Ali said the bank would lend less this year after fourth quarter profit fell 84 percent as it set aside more money for bad loans and a fall in its market investments.

Bank Negara's 10-year industry plan, announced March 1, will see foreign lenders such as HSBC Holdings Plc, Citibank NA allowed new branches in six years with more to follow.

``While the masterplan is welcome, implementation will be key. It can be gleaned that the authorities will likely cut the number of local banks to five or six before opening the sector,'' said Mike Oyson, analyst at Deutsche Bank AG's financial institutions group in Hong Kong.

Staff Issues

However, analysts say the 10 anchor banks may not reap the full benefits of lower costs from the consolidation because they've promised the central bank they would not retrench any of the 100,000 staff on their rolls till 2003.

That means banks will carry the excess staff even as Malaysia is widely seen as over-banked, with some 2,680 bank and finance company branches serving a population of 22 million. Next-door Thailand has about 3,750 branches serving 61 million people.

Still, the central bank may be willing to yield on the issue. Maybank said last week it expects to trim as much as 10 percent of staff through a voluntary redundancy package which the authorities are likely to allow. Also, Hashim Ismail, a parliamentary secretary in the Finance Ministry was quoted in today's Business Times as saying banks may cut as much as 10 percent of staff following the mergers.

Debt Workout

Analysts said the slow pace of debt reorganization at two of the country's largest diversified groups, Renong Bhd. and Lion Corp. Bhd., is also prolonging loan recovery for banks.

``The pace of restructuring is slow as there are delays from the Kuala Lumpur Stock Exchange and Securities Commission on some approvals to reorganize companies,'' OCBC's Yeoh said.

Renong, the country's largest debtor, and its units owe banks and other lenders 20 billion ringgit while Lion group, owner of Malaysia's biggest traded steelmaker, owes 10.2 billion ringgit.

``With all that's happening, another round of mergers to create five or six large domestic banks has to happen if we are to survive against the big foreign players,'' said Lim Beng Leong, head of research at Thong and Kay Hian Securities Sdn.

http://news.catcha.com/my/content.phtml?1&010&&afpnews.cgi&cat=malaysia&stor y

Malaysian banking merger to cause around 10,000 redundancies

KUALA LUMPUR, March 20 (AFP) - Malaysia's series of banking mergers will not lead to massive retrenchment and fewer than 10,000 employees will be affected, a senior official said Tuesday.

The country's 54 banking and financial houses are undergoing a major program to merge into 10 core groups.

The National Union of Banking Employees has expressed concern that around 17,000 out of 77,000 workers in the sector could leave the industry in the next two years.

But Hashim Ismail, the finance ministry parliamentary secretary, told parliament around 10 percent of the total workforce would be affected.

"Out of the 10 anchor banks, four banks have given their assurance that they will not lay off any employee as their services were required due to expanding operations," he was quoted by Bernama news agency as saying.

Hashim said the remaining six groups were likely to carry out a staff rationalisation exercise either this year or next year, but this would involve fewer than 10,000 employees.

Some 1,000 bank workers have already accepted compensation offers to opt for voluntary retirement last year, he said.

All those affected would be provided with adequate compensation and the Institute of Banks would conduct training programs to equip them with new skills, he added.

Top bank Malayan Banking Bhd. last week announced a voluntary redundancy scheme for around 10 percent of its workforce as part of a rationalisation and consolidation exercise.

Analysts have said the bank's move was likely to be the first of many job cut announcements and warned this could affect domestic consumption and further worsen the economic outlook.

http://www3.bernama.com/web/general/ge2003_3.htm

March 20 , 2001 13:06PM

Bank Merger Will Not Result In Large Lay Off Of Workers

KUALA LUMPUR, March 20 (Bernama) -- The merger of 51 banking and financial institutions into 10 anchor banks recently will only result in the laying off of less than 10 per cent of the total workforce in the banking sector, the Dewan Rakyat was told today.

The Parliamentary Secretary to the Ministry of Finance, Hashim Ismail said those affected would receive adequate compensation from their respective employers under a voluntary separation scheme (VSS).

"In fact, out of the 10 anchor banks, four banks have given their assurance that they will not lay off any employee as their services were required due to expanding operations," he said, replying to opposition leader, Fadzil Mohd Nor (Pas-Pendang) during a question-and-answer session.

--BERNAMA

http://www.bizedge.com.my/article.cfm?id=2648

19-03-2001:

Danaharta to issue asset-backed securities by June

By Sidek Kamiso, 8.40pm

National asset management company Pengurusan Danaharta Nasional Bhd plans to issue a series of asset-backed securities of up to RM3 billion by June, in order to convert its performing loans into cash.

Managing director Datuk Azman Yahaya said Danaharta has shortlisted four local banks to convert the performing loans it currently manages into the asset-backed securities, which will be sold to local and foreign investors.

"We will probably introduce it by the second half of this year because there are a lot of things to be done in terms of rules and regulations, especially when you are offering ringgit notes to foreign interests," Azman said at a media briefing in Kuala Lumpur today.

Danaharta has a total of RM5.45 billion of performing loans, of which RM3.71 billion are loans that have been performing for more than a year.

Azman said the first issue would be small because the company wants to ensure that the market fully understands the programme before it introduces bigger issues.

"Don't expect us to issue RM3 billion to RM5 billion for the first issue," he said, adding that the bulk of the loans are from the conventional banking system.

Azman also said the exercise would enable Danaharta to sell back the loans to banks and remove the stigma from borrowers, who might have difficulties in getting further financing if Danaharta was managing the loans.

"Some of these borrowers need support from banks," he said, adding that it is also better for banks to manage the loans as they have the resources.

Azman said Danaharta would no longer acquire non-performing loans (NPLs) from the banking sector, although their level has risen since last September. However, the NPLs are still manageable.

On the recovery proceeds, he said the main bulk of the money would be reinvested in financial instruments, such as bonds and the money market, with the balance going towards their redemption.

"We are sitting on a pile of cash," Azman said. Although the company wants to invest the proceeds in bonds, there are not enough of them in the market. As a result, Danaharta has resorted to purchasing its own bonds for the investment, making it the largest buyer of its own bonds.

Comments To This Article:

Confusing Plans (hkw212, 19/03/2001)

It is indeed confusing when Danaharta announces on the one hand to issue new securities to raise cash and on the other hand state that they have so much excess cashflow that they have to buy back their own bonds. It just doesn't make sense as they will end up paying a ton of fees.

http://asia.dailynews.yahoo.com/headlines/asia/asiapulse/ article.html?s=asia/headlines/010320/asia/asiapulse/ Malaysia_s_Danaharta_to_Sell_Performing_Loans_to_Banks.html

Tuesday, March 20 12:50 PM SGT

Malaysia's Danaharta to Sell Performing Loans to Banks

KUALA LUMPUR, March 20 Asia Pulse - In what is seen as a return to the improved health in the banking sector, Pengurusan Danaharta Nasional Bhd said it will not be acquiring any more non-performing loans [NPLs] from the banking sector.

Instead, the asset management company would sell performing loans back to the banks probably in the second half of the year, its managing director, Azman Yahya told a press conference here Monday to announce its operations for the six months-ended Dec 31, 2000.

Azman said he consideres the banking sector to be stable which would be able to manage their own NPLs.

However, Danaharta would consider selling performing loans -- of some RM3 billion, back to the banking sector for the banks to service them.

This would not be an outright sale but in the form of asset securitization whereby the sale process will be done in small portions via tenders, he said.

He said a series of sales of securitized assets could take between two to three years and the size would grow as the market becomes familiar with them.

Danaharta is currently working out the details and is looking at rules and regulations to allow even foreign banks to participate in the Ringgit-denominated securities, he said.

Azman also said that Danaharta todate has restructured 74 percent of its total RM47.49 billion [US$12,5 billion] NPLs portfolio, with the remaining RM12.40 billion targeted to be restructured by the end of this year at recovery rates of between 50 and 60 percent.

He said the asset management company is confident of restructuring all the NPLs by end of the year and Danaharta would be on track to achieve its targeted closure by 2005.

"By 2005, we will be left with cash and bonds and will be in the position to redeem the bonds", he said. With that, Danaharta which started operations in 1998, would have operated for seven years which is shorter than the anticipated 10 years.

Reviewing the company's operations, he said, at end-2000, Danaharta had carved out a total of RM47.49 billion of NPLs, of which RM39.30 billion was from the banking system and RM8.19 billion from non-banking and offshore institutions.

Of this, Danaharta is managing RM27.10 billion of NPLs in respect of the Sime Bank Group and Bank Bumiputra Malaysia Bhd group.

He said the RM47.49 billion comprise NPLs worth RM39.33 billion under the primary carve-out completed on June 30, 1999 and another RM2.71 billion under the secondary carve-out from July 1, 1999 to March 31, 2000.

Another additional NPLs worth RM5.45 billion are from Sime Bank and BBMB placed under Danaharta's management [transferred under existing put option agreements between June 30, 1999 and Dec 31, 2000.

In return for the NPLs acquired up to March 31, 2000, he said Danaharta issued RM11.4 billion in face value of government guaranteed bonds worth RM8.22 billion and paid RM0.8 billion in cash to the selling financial institutions.

As for property tenders, as at end-2000, the recovery from foreclosure exercises showed a decrease from 48 percent [as at end-June 2000] to 28 percent, mainly due to the shortfall recorded upon foreclosure on the share collateral of one large loan.

Danaharta had conducted four property tenders offering 449 properties [excluding hotel and leisure properties] worth RM985.93 million and sold 72 percent of that properties since the first tender in November 1999.

As for hotel and leisure properties, on Oct 11, 2000, 11 hotels were offered for sale in a joint tender by Danaharta [offering three foreclosed hotels] and the Special Administrators of seven companies [offering eight hotels].

At the close of tender on Nov 15 2000, he said 15 bids were received, of which three were accepted.

As at end of last year too, Danaharta had completed three restricted tender exercises [RTEs] to dispose foreign loan assets, that is non-Ringgit loans and marketable securities extended to or issued by foreign borrowers, in its portfolio.

The third RTE, which was held from Aug 14 to Sept 11, 2000, involved 45 accounts comprising 24 loans and 21 marketable securities worth US$168.81 million [RM641.48 million].

For 29 of the 45 accounts, Danaharta received a total of US$66.31 million [RM253.98 million] in cash and Malaysian loan assets of RM8.17 million, which translate in the recovery rate of 65 percent.

Two accounts were fully settled by the borrowers while Danaharta retained 14 accounts. No future disposal exercise are planned for foreign loan assets.

As for management of securities, in the course of its recovery operations as at end 2000, it had in its portfolio securities with a market value of RM620 million.

(Bernama)