ASM Unitholders Get 6.30 Sen Per Unit

Amanah Saham Nasional Bhd (ASNB) today announced an income distribution of 6.30 sen per unit for Amanah Saham Malaysia (ASM) for the financial year ended March 31, 2010.

Last year, the government-owned fund manager declared an income distribution of 6.25 sen per unit, which was the lowest since its introduction in 2000.

The highest dividend given by the wholly-owned subsidiary of Permodalan Nasional Bhd (PNB) was 7.8 sen.

PNB chairman Tun Ahmad Sarji Abdul Hamid said the income distribution involved a total payout of RM654.06 million, an increase of 60.5 per cent from RM407.58 million paid in 2009.

The payment will benefit 552,000 unitholders who had subscribed to 11.2 billion ASM units as at March 19, 2010.

When announcing the income distribution for ASM here, Ahmad Sarji said the equity market and the domestic investment environment had shown market improvement compared with the situation a year earlier, in line with the global economic and financial market recovery throughout the ASM financial year.

"These factors, combined with the successful implementation of the RM67 billion government stimulus package and accomodative monetary policy, has helped Malaysia to record positive growth in its gross domestic product (GDP) of 4.5 per cent in the fourth quarter of 2009," he said.

PNB president and group chief executive Tan Sri Hamad Kama Piah Che Othman said the payout of 6.30 sen was still better compared to payouts from other instruments with a similar risk profile.

"We feel that this figure is good enough for our unitholders. If we were to look in total, our capacity is to pay out 7.40 sen per unit but we only paid 6.30 sen because we want to have more reserves to bring forward next year," he said, adding that PNB has about RM118 million ASM reserves for 2011.

"The performance of the fund still depends on the market performance, which we hope our stock market will be better in tandem with the positive GDP growth."

Hamad Kama Piah said most analysts had projected the benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) to index to hover around 1,300 to 1,400 level this year.

"Foreign interest in the stock market is considered the lowest at present. Most probably the buying appetite will come back soon, then we can see better margin," he said.

Up until March 19, 2010, ASM had recorded a gross income of RM800.83 million. Profit from the sale of shares contributed RM429.83 million, or 53.7 per cent of the gross income.

Dividend income provided RM259.69 million or 32.4 per cent and the remaining income of RM111.31 million or 13.9 per cent was derived from investments in short-term instruments.

The income distribution will be reinvested in additional ASM units to be automatically credited into the unitholders' accounts on April 1, 2010.

ASM is a fixed priced equity-income fund aimed at providing unitholders with a long-term investment opportunity that generates regular and competitive returns through a diversified portfolio of investments.

Six Billion Amanah Saham 1Malaysia Units Still Available For Subscription

Six billion Amanah Saham 1Malaysia (AS1M) units are still available for public subscription, to-date.

Permodalan Nasional Bhd (PNB) President and Group Chief Executive Tan Sri Hamad Kama Piah Che Othman said the Bumiputera and Indian quota made up the bulk of the remaining portion.

Saying that the subscription pace had not changed much since ASM1 was launched in July last year, he said the take-up rate was the fastest among the Chinese.

"Only eight per cent or 238 million units of the three billion units allocated for the Chinese community is still available," he told reporters after announcing the income distribution for Amanah Saham Malaysia (ASM) here on Monday.

He said the equity income fund enjoyed brisk sale among the Chinese community as not many funds offered by PNB were open to non-Bumiputeras.

"Many people are still waiting for the maiden dividend to be announced. They want to compare with other funds, under PNB, to determine if the returns from AS1M is as attractive as other unit trusts," he said.

Hamad Kama Piah said Bumiputeras were more comfortable investing in Amanah Saham Bumiputera (ASB) and Amanah Saham Didik.

The AS1M, a fixed price fund of RM1 per unit, is open to all Malaysians with 50 per cent allocated to Bumiputeras, 30 per cent Chinese, 15 per cent Indians and other races, five per cent.

The fund is the fifth launched by PNB after the ASB, ASM, Amanah Saham Didik and Amanah Saham Wawasan 2020.

Vehicle Sales In February 2010 Up 1.09 Per Cent

Sales of passenger cars and commercial vehicles in February 2010 rose 1.09 per cent year-on-year to 40,654 units from 37,386 units but on a month-on-month basis, it was down by 19.7 per cent.

The Malaysian Automotive Association (MAA) attributed the lower sales due to short working month because of the Chinese New Year holidays.

Sales of passenger vehicles in February 2010 rose to 36,551 units from 33,992 units in the corresponding month last year while that of commercial vehicles rose to 4,103 units from 3,394 units, it said in a statement on Monday.

Sales of passenger vehicles in the first two months of the year increased to 82,524 units from 68,621 units in the corresponding period last year.

Sales of commercial vehicles in the same period went up to 8,752 units from 6,872 units previously.

For the two-month period, the total industry volume rose to 91,568 units from 78,059 units in the same period last year.

MAA said total production of vehicles in February 2010 went down to 40,272 units from 40,632 units in the corresponding month last year.

Production of passenger vehicles in February declined to 36,740 units from 36,985 units in the corresponding month last year while that of commercial vehicles dropped to 3,532 units from 3,647 units.

However, production of passenger vehicles in the two-month period rose to 82,912 units from 69,406 units in the same period last year while that of commercial vehicles went up to 8,656 units from 8,653 units.

Going forward, MAA said that sales volume for March 2010 is expected to be better than February due to seasonal factor.

"This is likely to continue the year-on-year sales volume expansion recorded in the first two months of this year," it said.

Vincent Tan In Forbes Billionaires List

Berjaya Chairman and Chief Executive Officer Tan Sri Vincent Tan became the latest Malaysian tycoon to make it into the Forbes' 2010 world billionaires list.

The newcomer, who is worth US$1.2 billion and ranked 828, joined another eight Malaysian regulars who were among the 1,011 billionaires on the global list released by Forbes on Thursday.

The other Malaysians were sugar king Robert Kuok who was ranked 33 with a net worth of US$14.5 billion, followed by telecommunications magnate Ananda Krishnan (89)(US$7.6 billion), IOI Corporation Chairman Tan Sri Lee Shin Cheng (189)(US$4.4 billion), Public Bank Chairman Tan Sri Teh Hong Piow (277)(US$3.4 billion).

Hong Leong Group Chairman Tan Sri Quek Leng Chan (277) (US$3.4 billion), YTL Corporation Chairman Yeoh Tiong Lay and family (421) (US$2.3 billion), Tan Sri Syed Mokhtar Al-Bukhary (655) (US$1.5 billion) and Rimbunan Hijau Group Chairman Tiong Hiew King (937) (US$1.0 billion).

Forbes said the number of tycoons from the Asia-Pacific region with a ten-figure net worth has risen to 234 from 130 last year, of which 62 were first-time billionaires out of a total of 97 new billionaires in the world.

This accounted for 23 per cent of the 1,011 billionaires on the global list against 16 per cent of the 793 billionaires the year before.

The combined wealth of Asian billionaires had also more than doubled to US$729 billion compared with $357 billion a year ago.

This rate of increase far outpaced that of European tycoons who saw their collective fortune rise by 50 per cent while their US counterparts enjoyed only an 18 per cent increase.

Of the Asian economies, China continues to lead the pack by more than doubling its number of billionaires to 64 from 28 last year, followed by India with 49 from 24 previously.

Third is Hong Kong with 25 billionaires, followed by 22 from Japan, 18 from Taiwan, 11 each from Australia and South Korea.

There were seven from Indonesia, five from Kazakhstan, four from Singapore, three each from New Zealand and Thailand, two from the Philippines, and one from Pakistan.

The richest man in Asia-Pacific and fourth in the world rankings is Mukesh Ambani from India, head of Reliance Industries.

The richest man in the world is Mexican telecom titan Carlos Slim Helu and family.

AmBank Increases Interest Rates For Fixed Deposits

AmBank (M) Bhd has increased the interest rates for fixed deposits, effective on Thursday.

In a statement here, AmBank said this followed the recent increase in overnight policy rate by Bank Negara Malaysia and in line with its recent increase in its base lending rate from 5.55 per cent per annum to 5.80 per cent.

AmBank said it has passed on the full 25-basis-point rise to the customers' fixed deposits for one month and 12 months.

New Economic Model To Be Announced On March 30

The first stage of the New Economic Model (NEM) will be announced on March 30, Prime Minister Datuk Seri Najib Tun Razak said on Thursday.

The second stage of the model would be announced at the tabling of the 10th Malaysia Plan.

HLB Introduces Online Business Service

Hong Leong Bank Bhd (HLB) has launched a new online service, Hong Leong Online (Business), designed to innovate and strengthen its cash management services.

"In today's fast-paced environment, HLB consistently tries to provide more innovative online banking solutions.

"The introduction of the Hong Leong Online (Business), is one such way," said HLB's Chief Operating Officer of Wholesale Banking, Kua Wei Jin in a statement on Wednesday.

He also said that some important account management functions such as current account, foreign currency accounts, loan accounts and fixed deposit balance inquiries, would be incorporated into the new online service.

According to Kua, HLB will enable the electronic payment of SOCSO contributions in the next two months with more plans for customers by the year end.

Asian Finance Bank Bhd (AFB) will raise its base financing rate to 5.75 per cent, from the current 5.5 per cent, effective March 9.

Asian Finance Bank Bhd (AFB) will raise its base financing rate to 5.75 per cent, from the current 5.5 per cent, effective March 9.

Its Chief Executive Officer, Datuk Mohamed Azahari Kamil, said the increase was in line with the 25 basis points hike in overnight policy rate to 2.25 per cent.

Demand for financing would not be dampened as the economic recovery was firmly established as shown in the latest Gross Domestic Product (GDP) figures, he said in a statement on Monday.

He also said Bank Negara's move should be seen as part of a "normalisation" process and not as a "tightening" cycle.

"AFB was committed to offer financing to good rated customers and financing approved by the bank, todate, had surpassed RM1 billion.

"We are more selective now as we are entering the second phase of the bank's assets growth," he added.

RHB Raises BLR, BFR To 5.8 Pct

RHB Bank Bhd and RHB Islamic Bank Bhd will raise its Base Lending Rate and Base Financing Rate respectively to 5.8 per cent from the current 5.5 per cent effective tomorrow.

Group Managing Director Datuk Tajuddin Atan said the revision was in line with Bank Negara Malaysia's move to increase the Overnight Policy Rate (OPR) by 25 baiss points to 2.25 per cent.

"We are committed to doing our part to ensure that viable borrowers will continue to have access to financial products and services to carry out and grow their businesses in everyone's interests," he said in a statement on Monday.

"We will also be balancing the increased borrowing rates by offering more competitive rates for depositors," he added.

Last Thursday, the central bank said the adjustment of OPR was towards normalising monetary conditions and preventing the risk of financial imbalances that could undermine the economic recovery process.

Hong Leong Raises BLR To 5.8 Pct

Hong Leong Bank Bhd and Hong Leong Islamic Bank Bhd will raise their base lending rate (BLR) and Islamic financing rate (IFR) to 5.8 per cent from 5.5 per cent effective this March 10.

Its group managing director, Datuk Yvonne Chia today said the change supports Bank Negara Malaysia's decision to increase the overnight policy rate (OPR) by 25 basis points.

In a statement here, she said the bank would also continue to work closely with its customers to address all their financing needs.

Last Thursday, the central bank said the decision to raise the key interest rate was made amid an improved economic outlook.

Following its Monetary Policy Committee (MPC) meeting, Bank Negara added that the adjustment to the OPR was towards normalising monetary conditions and preventing the risk of financial imbalances that could undermine the economic recovery process.

Maybank Raises BLR To 5.80 Pct

Maybank is revising its Base Lending Rate (BLR) from 5.55 per cent per annum currently to 5.80 per cent per annum effective tomorrow.

The Base Financing Rate (BFR) of Maybank Islamic Bhd would similarly be revised from 5.55 per cent to 5.80 per cent, Maybank said in a statement on Monday.

Maybank President and Chief Executive Officer Datuk Seri Abdul Wahid Omar said the interest rate revision was based on the recent adjustment in the Overnight Policy Rate.

"We expect to see better growth from our core business segments, leveraging on the improving economic environment and as more customers take advantage of the diversity of our product and service offerings," he said.

The last time Maybank and Maybank Islamic changed their BLR and BFR respectively was on March 2, 2009 when the rates were revised from 5.95 per cent to 5.55 per cent.

PNB Offers 300 Million ASD

The size of the Amanah Saham Didik (ASD) has swelled to 3.8 billion units following the announcement by Amanah Saham Nasional Bhd, a subsidiary of Permodalan Nasional Bhd (PNB) that it is offering an additional 300 million units.

The offer of new units was the 11th since ASD was launched in 2001, with the initial 300 million units, said PNB, Malaysia's biggest fund manager, in a statement Monday.

As of Jan 31, 2010, 3.36 billion units were subscribed by 271,226 unitholders, said PNB President and Group Chief Executive Tan Sri Hamad Kama Piah Che Othman in a statement.

Of the total, 89.92 per cent unitholders were aged 18 years' old, who invested in the scheme for education financing, he added.

ASD is an equity fund offered to Bumiputeras from as young as six-month-old at RM1 per unit. There is no limit to maximum units subscribed but subject to units available.

Will key interest rate continue to rise?

The first interest rate hike for quite a while announced by Bank Negara Malaysia last week did not dent sentiment both on stocks and as several analysts said, spending in general.

It was expected as given the raise in the overnight policy rate (OPR) was just 0.25 per cent, and from a historic low of 2 per cent, the hike was insignificant. But whether Bank Negara will stop at that is another question altogether.

Banking stocks, as anticipated, responded well as the increase means better interest margins for banks but they were quick to assure customers that the OPR remained low compared with the historic lows in early 2009 when keeping interest rates low was made one of the strategies to face the-then severe economic downturn.

But the last three months have seen the global economy returning to recovery mode and in Malaysia's case, a growth of 4.5 per cent was recorded.

Spending by households and businesses are expected to continue expanding with the support of a stable labour market and confidence among customers and businesses.

The question now is whether Bank Negara will continue to raise the OPR rate.

The market believes so, at least between 25 and 75 basis points, but on a gradual basis till the end of 2010. There will be four more policy meetings this year.

The market is split on the monetary policy outlook. While the majority felt that the central bank would be prompted to go ahead with more increases now that the Malaysian economy has come back on the growth track to emerge out of the recession, the central bank's conservative stance could mean it may well wait for indications from its counterparts in the US and also the region.

Governor Tan Sri Dr Zeti Akhtar Aziz has repeatedly reminded the media to use the term "normalise" and not "tighten" when describing the central bank's anticipated monetary policy change.

It is left to the market to figure what the "normalised" rate would be like for Malaysia which only introduced the OPR in 2004. At that time, the rate stood at 2.7 per cent.

In OSK Research's banking analyst Keith Wee estimates, even if Bank Negara were to raise the OPR by 75 basis points over the course of the year, the OPR at 2.75 per cent would still be significantly below the 5 per cent to 3.5 per cent range between September 2001 and October 2008.

Being the only second rate hike cycle over the past decade since the 1998 financial crisis and given that interest rates are being raised from historical lows, gradually normalising interest rates is unlikely to negatively affect loan growth and asset quality.

During the last OPR hikes (November 2005-March 2006) totalling 80 basis points, Wee said the BLR rose by a much larger 74 basis points versus one-month fixed deposit rates, 3-month fixed deposit rates and 6-month fixed deposit rates, leading to strong net interest margins but the current system flush with liquidity will ensure that deposit rates are likely to remain sticky.

New Proposal On Fuel Subsidy To Be Tabled To Cabinet

The Domestic Trade, Cooperative and Consumerism Ministry will table a new proposal on the restructuring of the fuel subsidy to the Cabinet soon.

Its minister, Datuk Seri Ismail Sabri Yaakob, said the ministry, with cooperation from the Subsidy Rationalisation Lab, would propose the best implementation mechanism to channel all subsidies including fuel, food or infrastructure.

"We will also propose to the Cabinet the best suitable methods to curb the purchase of subsidised fuel by foreign nationals," he told reporters after opening the mini fuel station operated by the Gugusan Sri Makmur Felcra Settlers Cooperative here Saturday.

At present, foreign motorists are only allowed to buy fuel up to 20 litres within 50km of the borders, but the ruling does not apply to other places including Kuala Lumpur.

On March 4, the government announced that its proposed tiered fuel subsidy had been scrapped after it received negative feedback from the people and that the current system of subsidising fuel would be maintained.

Meanwhile, Ismail Sabri said the ministry would also proposed to the Cabinet to lift the freeze on the issuance of licences for mini fuel stations in rural areas imposed in 2007.

"The rationale behind this is that we need to increase the number of mini fuel stations in the rural areas," he explained.

He said the proposal to lift the freeze on the issuance of licence, however, would also introduce new and stricter licence requirements.

EPF Declares 5.65% Dividend For 2009

Highest Total Dividend Paid Out of RM19.63 billion

The Employees Provident Fund (EPF) Board, with the approval of the Minister of Finance, has declared a dividend rate of 5.65 per cent for the financial year ended 31 December 2009. The dividend rate was declared on the back of the highest ever net income achieved of RM19.63 billion.

The net income represents an increase of 34.82 per cent compared to RM14.56 billion recorded in 2008 while the dividend rate for 2009 is a significant improvement of 115 basis points over the rate of 4.50 per cent paid out for 2008.

In a statement issued today, EPF Chairman Tan Sri Samsudin Osman said, “2009 was a significant year for the EPF as it rode out the impact of the global financial crisis. While the EPF continues to be challenged by the fragile economic environment, our investments nonetheless delivered a sound performance for the year.”

During the year under review, a total of 72.53 per cent of investments were devoted to Fixed Income Instruments in line with EPF’s prudent approach to investment, while 27.05 per cent was in Equities, and the remaining in Property.

As at 31 December 2009, EPF’s investment portfolio grew 8.55 per cent or RM29.25 billion to RM371.26 billion compared to RM342.01 billion in 2008. These were invested in instruments detailed in the following table:

For the 2009 dividend payout, the EPF requires RM3.43 billion to pay a one per cent dividend rate as a result of a larger membership base. This represents a 7.86 per cent increase over the amount of RM3.18 billion per one per cent dividend rate for 2008. (Refer to Appendix).

Members can check their EPF Account Statement for the crediting of the 2009 dividend from Monday, 8 March 2010 onwards.

“Barring any unforeseen circumstances, prospects for 2010 are greatly dependent on the economic performance of the country and internationally. Globally, financial markets continue to be volatile and this may have an impact on the price performance of our investments and future income. EPF will continue to focus on our key goals of preserving the capital of our contributors and ensuring a satisfactory real rate of return,” concluded Tan Sri Samsudin.

IBM Launches New POWER7 System

IBM launched its new POWER7 systems during its annual IBM Technology Conference and Expo here on Tuesday.

The new IBM power system is designed to manage the most demanding emerging applications, ranging from smart electrical grids to real-time analytics for financial markets, the company said in a statement.

It can process millions of transactions in real time and analyse the associated volumes of data typical of emerging applications.

The POWER7, like other IBM power systems which run on the AIX, Linux and IBM i operating systems, is aimed to help clients manage their current applications and services at less cost, more energy savings, and with cost-efficient use of memory and better performance, IBM said.

"The new POWER7 technology and series of systems will strengthen our position in traditional business IT (information technology) and open up new opportunities to establish smarter industry infrastructures, particularly in areas we intend to focus, such as telco, financial services, energy and utilities," said Hemanth Kalikiri, Country Executive, System and Technology Group, IBM Malaysia.