Public Bank Berhad is the second largest company and bank in Malaysia with a market capitalisation of RM81.7 billion in May 2024. It has maintained its unbroken profitability for 57 years since inception in 1966. As a result, its valuation often trades at a premium with a book value of 1.5 times, which is often the highest among Malaysian banks.
Here are 12 things I learned from the 2024 Public Bank AGM.
1. Revenue and net profit attributable to shareholders increased 18.6% and 8.7% year-on-year to RM25.4 billion and RM6.6 billion respectively in 2023. The improvement in financial results was due to continued growth in loans and deposits, improvement in non-interest income as well as lower loan loss allowances. Dividend per share improved 11.8% from 17 sen in 2022 to 19 sen in 2023, which represented a dividend payout ratio of 55.5%.
2. Total gross loans and financing increased 5.9% year-on-year to RM399.0 billion in 2023. The growth in Public Bank’s domestic loan was faster than the industry’s growth at 5.3%. The bank continued to sustain its leading positions in the financing of residential property, commercial property, and hire purchase purchasing in Malaysia with market shares of 20.4%, 32.6%, and 30.5% respectively.
The company aims to mobilize RM100 billion in sustainable finance by 2030. Since 2020, it has already mobilized over RM53 billion in sustainable finance across its portfolios, including energy-efficient vehicles, affordable homes, corporate loans, and green finance facilities.
3. Minority Shareholder Watch Group highlighted the decline in the bank’s market share in the domestic SME financing from 21.6% in 2021 and 18.6% in 2022 to 17.9% in 2023. CEO Tan Sri Dato’ Sri Dr. Tay Ah Lek attributed the decline to intense market competition as well as low utilisation of finance facilities and loan repayment by borrowers. The