Bank Islam unfazed by developer loans proposal

Bank Islam Malaysia Bhd said the proposed move to allow developers to provide loans to house buyers will not have a severe impact on the bank, as it will continue to focus on its target market.
“For us, we don’t see any reduction in (our) approval rate, mainly because our target market remained stable,” its deputy CEO Khairul Kamarudin told reporters after launching the bank’s Visa Infinite Business Credit Card-i (business card-i) here yesterday. “Our target market has always been the middle income (segment) and we will continue focusing on our target market and we are seeing the same approval rate (going forward)”. Khairul said the bank’s approval rate last year was 70%, and slightly better this year at 71%, to date. He also said the bank has not experienced high loan rejections despite the current uncertain economic conditions. “People (borrower) who are eligible last year are also eligible this year. For the ones who have their applications get rejected are maybe for the ‘high ticket’ properties,” he added, noting that the bank is more focused on providing loans for affordable housing.
Earlier, Khairul said the bank expects to double its total revenue from the credit card segment to 10% in the next three years, from 5% currently, with the launch of its business card-i that allows holders to separate their personal and business-related spending.
Business card-i, which is Asia Pacific’s first syariah-compliant business credit card, is targeted at large corporations and small and medium enterprises in the country. Credit card benefits include a 20-day profit charge free period, no compounded finance charges, lifetime annual fee waiver, complimentary access to Plaza Premium Lounge in Malaysia and Singapore and free takaful travel coverage up to RM2 million and free takaful purchase protection up to RM10,000.
“With this prestigious business card, we hope to reach 10% of our business customers from our current corporate and commercial customer base of about 200,000 clients in the first three years of the launch,” said Bank Islam managing director Datuk Seri Zukri Samat.