Business

Friday June 6, 2008

Mobile, Net banking poised for more growth


KUALA LUMPUR: Mobile and Internet banking is set for further growth and expansion globally, industry experts told the 12th Malaysian Banking Summit 2008 yesterday.

CIMB Bank Bhd head (retail banking) Peter England said that Internet banking was being embraced at a rapid pace by developed and developing countries like Malaysia despite concerns such as security.

England said Malaysia had successfully adopted Internet banking since 2000 and that mobile banking would follow suit.

“Internet banking has become popular because of its convenience. However, there are still areas of concern such as security and assurance that channels of information are secure,” he said.

Maxis Broadband Sdn Bhd head of solutions and integration services (enterprise business division) Abdur Rahman Ebrahim concurred. He said mobile and Internet banking was naturally embraced by the masses, especially the younger generation.

Abdur Rahman said there were about 10 million Maxis subscribers in Malaysia.

“The mobile-phone is a personal and functional device which is getting indispensable,” he said.

Meanwhile, at an earlier session on the US subprime mortgage crisis, a panel of experts concurred that its impact on Malaysia's banking sector was negligible.

Malaysia Rating Corp Bhd senior vice-president and chief economist Nor Zahidi Alias said the exposure to US subprime debt securities accounted for only 0.3% of the Malaysian banking system’s capital base.

“The impact is insignificant if not minimal,” he said, adding that trade with the United States had also declined to about 15% of Malaysia's total exports, while trade with Asean countries had risen to 25% of total exports.

Standard & Poor's (Singapore) senior director of financial institutions ratings (Asia ex-China) Ritesh Maheshwari reaffirmed that the impact (of US subprime crisis) on Asia, especially Malaysia, was minimal.

“Even if the subprime woes continue and the US goes into a recession, Malaysia’s banking sector is likely to remain resilient. Maybe some bruises but not even a stumble,” he said.

Ritesh said countries like the Philippines and South Korea were more exposed to the US debt securities market.

He said Malaysia was in a better position to weather the subprime crisis compared with most other Asian countries because its financial institutions were strong and flushed with liquidity, and the economy was not solely dependent on the United States for growth.

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