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Tan Sri Teh Awarded The BrandLaureate Premier Brand Icon Leadership Award 2011

For Immediate Release

30 November 2011

Tan Sri Teh Awarded The BrandLaureate Premier Brand Icon Leadership Award 2011

The Asia Pacific Brands Foundation (APBF), a world leading branding foundation has awarded Tan Sri Dato’ Sri Dr. Teh Hong Piow, Founder and Chairman of Public Bank with “The BrandLaureate Premier Brand Icon Leadership”. Dr. KK Johan, President of The Asia Pacific Brands Foundation presented the award to Tan Sri Dato’ Sri Dr. Teh Hong Piow at a ceremony held at Menara Public Bank on Thursday, 24 November 2011.

On awarding the “The BrandLaureate Premier Brand Icon Leadership” to Tan Sri Teh   Dr. KK Johan said, “The award was initiated in recognition of great men and women who are the faces and key drivers behind their brands.”

“They are leaders of great substance, not just about who they are but what they are, the Icons who define leadership, set standards and shape history.” he said.

Dr. KK Johan in his citation statement said, “The ‘Premier Brand Icon Leadership’ is about a leader who impacts and influences the lives of others, it is about leadership that inspires, leadership that sees and act differently. I am speaking of none other than Tan Sri Dato’ Sri Dr. Teh Hong Piow, Founder and Chairman of Public Bank.”

He continued, “Tan Sri Dato’ Sri Dr. Teh Hong Piow whose visionary ideas, astute business sense, spirit and leadership qualities are the hallmark of Public Bank success.  The ‘BrandLaureate Premier Brand Icon Leadership’ is the highest level of brand leadership award, the ultimate honour for the best.  Tan Sri Teh you are the best that can happen to this country.”

Tan Sri Teh is happy with the award and commented, “To be given this honour gives me a sense of satisfaction as this recognition makes all my years in the banking industry very rewarding. I dedicate this achievement to all the shareholders and stakeholders whose loyalty and support to the Public Bank name have made us a renown name in this region.”

Tan Sri Teh has also been the past recipient of  The BrandLaureate – Tun Dr. Mahathir Mohamad  Man of the Year 2010-2011 by Asia Pacific Brands Foundation, Asia’s Best CEO (Investor Relations)  in the 1st Asian Excellence Recognition Awards 2011 by Corporate Governance Asia,  Asian Corporate Director Recognition Award 2011 by Corporate Governance Asia,  The Asset’s  “Asia’s Banking Grandmaster” and “Asia’s Banker of High Distinction” and other  prestigious awards such as “Best CEO in Malaysia”, “Asian Banker Par Excellence”, “Lifetime Achievement Award” and “One of Asia’s Most Influential 1996-2006” and “Best CEO in Malaysia”; all of which acclaim his exceptional foresight and astute leadership.

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Dr. KK Johan (right) President of Asia Pacific Brands Foundation presenting The BrandLaureate Premier Icon Leadership Award 2011 to Tan Sri Teh.
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Public Bank Group Nine-Month Net Profit Up 18.4%

For Immediate Release

17 October 2011

Public Bank Group Nine-Month Net Profit Up 18.4%

Sustainable Strategies Drive Broad-based Growth Amidst Economic Uncertainties

 

- Profitability: Net profit growth of 18.4% and 26.7% net return on equity, driven by:

 

(i) Strong revenue growth of 9.6%

 

(ii) Continued disciplined cost management with low cost-to-income ratio of 30%; and

 

(iii) Superior asset quality with improvement in credit charges by 15%

 

- Market leadership: Sustained No. 1 position in domestic lending for residential mortgages, commercial property financing and passenger vehicles financing

 

- Growth: Above-industry growth in loans and deposits, driven by the Group’s PB Brand strong retail franchise

 

- Asset Quality: Below 1% gross impaired loans ratio, underpinned by prudent lending policies and strong risk management practices

 

The Public Bank Group delivers yet another strong set of results in the first nine months of 2011 with record net profit of RM2.6 billion, which is 18.4% higher compared to the corresponding period in 2010. Pre-tax profit grew by 16.6% to RM3.4 billion over the same period.

Chairman’s Review
The Chairman of Public Bank, Tan Sri Dato’ Sri Dr. Teh Hong Piow said, “The Public Bank Group’s sound financial results are a validation of the Group’s effective organic growth strategies and sustainable business model. The Group continues to retain a clear lead with the highest net return on equity of 26.7% amongst the Malaysian banking groups. At the same time, we continue to sustain top ranking in asset quality and cost efficiency amongst the peers. We have benefited from our disciplined execution of our growth strategies whilst preserving prudent risk management practices to ensure sustainable and stable returns.

We are encouraged by the steady performance in our core businesses, with both our net interest income and fee income registering growth despite the weaker economic sentiments particularly over the past 2 quarters. Despite the competitive pressure on interest margin, the Group’s net interest and finance income improved by 9.7% in the first nine months of 2011, and fee income grew by 9.1% over the same period.

Our balance sheet growth indicators remained healthy. Gross loans book stood at RM172.7 billion, which grew by 13.8% on an annualised basis. Domestic loan growth remained strong with an annualised growth rate of 14.1%. Over the same period, total customer deposits grew by an annualised rate of 12.7% to RM193.7 billion, while domestic customer deposits grew at a stronger annualised growth rate of 13.8%. We are confident that with our healthy loans pipeline and coupled with our strong PB Brand franchise, we will continue to strengthen our core revenue streams.”

Growth & Profitability Intact
The lending activities of the Public Bank Group remained focused on the retail sector, with loans to mid-market commercial enterprises as well as loans for the financing of residential properties and purchase of passenger vehicles accounting for 85% of the total loan portfolio of the Group as at the end of September 2011. Domestic retail pre-tax profit grew by RM335 million or 15.9% year-on-year, with a notable 11.9% increase in net interest income and lower credit charges.

Tan Sri Teh highlighted that, “Public Bank continued to sustain its market leadership position in domestic lending for residential mortgages, commercial property financing and passenger vehicles financing with market shares of 18.0%, 33.7% and 25.7% respectively. In particular, the Group’s residential properties and passenger vehicles financing grew at impressive annualised rates of 17.7% and 9.7% respectively during the 9-month period, compared to lower industry growths of 12.5% and 6.7% respectively.” The Group remained supportive in promoting small- and medium-sized enterprise (“SME”) activities particularly for working capital and investment financing. Loans to the SME sector for the 9-month period grew strongly by an annualised rate of 15.6%.

“The Public Bank Group’s funding position remained robust supported by its strong retail franchise and large domestic depositor base of over 4.5 million customers. Domestic customer deposits grew at an annualised growth rate of 13.8%, compared to the domestic banking industry’s annualised growth of 9.8%,” said Tan Sri Teh. The strong domestic deposit growth was mainly attributed to steady inflows of fixed deposits and savings deposits which grew at annualised growth rates of 12.2% and 11.9% respectively, outperforming the Malaysian banking industry’s annualised 9.5% growth in fixed deposits and annualised 9.1% growth in savings deposits.

Growth in Fee-based Income
Non-interest income of the Public Bank Group recorded a commendable growth of 9.1% compared to the corresponding period in 2010, mainly driven by higher banking transactional income and income from Public Mutual’s unit trust business as well as higher investment income.

Tan Sri Teh explained, “The Group’s unit trust management business through its wholly-owned subsidiary, Public Mutual, continued to show commendable performance with a pre-tax profit growth of 22.3% in the nine months of 2011, and maintained its pole position in private unit trust business with RM41.3 billion of net assets under management, accounting for an overall market share of 43% as at the end of August 2011, and with market shares in the equity and Islamic unit trust fund sectors of 60% and 55% respectively.”

Continued Disciplined Cost Management
Tan Sri Teh further commented, “The Public Bank Group continues to drive cost efficiency initiatives to further improve productivity with cost-to-income ratio of 30%. Compared to the banking industry’s average cost-to-income ratio of 46.7%, the Group remained the most cost-efficient bank in Malaysia.” Operating expenses increased marginally by 4.6%, less than half the pace of the much higher income growth of 9.6%. Increase in personnel costs was in line with the investment in human resources and larger headcount to support business expansion.

Lending with Uncompromised Asset Quality
“The Public Bank Group has not only maintained its top ranking in asset quality amongst its peers, but also further improved its gross impaired loans ratio from 1.14% as at the beginning of the year to below 1% as at the end of September 2011, significantly lower than the Malaysian banking industry’s gross impaired loan ratio of 2.8%,” said Tan Sri Teh. The strong asset quality of the Group is due to, inter alia, its prudent lending policies and strong risk management practices, its affluent customer base, as well as the prompt and timely loan recovery efforts undertaken.

The Public Bank Group's loan loss coverage ratio continued to remain one of the highest at 178.1%, compared to the banking industry's coverage ratio of 96.3% notwithstanding that more than 90% of the Group’s impaired loans outstanding are secured. In line with BNM’s Guidelines to maintain a minimum of 1.5% collective assessment, the increase in the Group’s loan loss coverage was a result of setting aside additional collective assessment allowance for strong loan growth while maintaining a stable level of impaired loan. New impaired loans formation for the first nine months of 2011 improved to an annualised 0.33% from 0.51% in 2010. As a result, the Group’s loan impairment allowances improved by 15% during the nine months ended 30 September 2011 compared to the previous corresponding period, despite setting aside 1.5% collective assessment for loan growth.

Expansion of Overseas Operations
For the first nine months of 2011, the Public Bank Group’s overseas operations contributed 6.5% of the Group’s overall pre-tax profit compared to 7.6% contribution in 2010 due to the negative effect of foreign exchange differences. Excluding the impact of the foreign exchange differences, overseas profit grew by 11.8% compared to the corresponding period in 2010, led by improvement in asset quality and operational efficiency. Over the same period, Cambodian Public Bank Plc (“Campu Bank”), a wholly-owned subsidiary of Public Bank reported a strong growth in pre-tax profit of 90% to USD20.6 million compared to USD10.8 million in the last corresponding period.

Capital Position Remains Healthy
Tan Sri Teh emphasised that, “The Public Bank Group’s capital position remains healthy, with its Tier 1 capital ratio and risk-weighted capital ratio standing at 9.5% and 14.9% respectively as at the end of September 2011 compared to 10.0% and 13.7% respectively as at the beginning of the year.” The improvement in the risk-weighted capital ratio of the Group during the current period was due to the issuance of RM3 billion subordinated notes under the existing subordinated Medium Term Note programme in August 2011.

The Public Bank Group will continue to monitor further developments in relation to the Basel III requirements and any additional regulatory capital requirements to be imposed by Bank Negara Malaysia. This will allow the Group to address the potential impact of such requirements by realigning existing capital management strategies from time to time. The Group remains committed to maintaining a healthy level of capital at all times to support the Group’s business growth strategies whilst maximising its shareholder value.

Chairman’s View on Group’s Prospect
Tan Sri Teh remarked that, “Our strategies remain unchanged. The Public Bank Group will continue to focus on its core retail banking and financing business whilst maintaining its prudent credit policies, and further improve on its cost efficiency. The Group expects its strong asset quality to be sustained, and will continue to leverage on the strong PB Brand franchise and its wide and efficient branch network to deliver balance sheet and revenue growth. The Group remains steadfast in its commitment to upholding strong corporate governance and implementation of sound risk management policies to support long-term growth.

With the expectations that global uncertainties and volatility will persist over the medium term, we remain vigilant and focused in balancing growth with sustainable returns. Taking cognisance that economic growth pace will moderate further, we will focus on reinforcing our business performance through prudent and effective balance sheet management to sustain our profitability. On the service delivery front, we will continue to uphold our superior customer service and delivery excellence.

The outlook of the Malaysian banking sector, in which the Group largely operates in, continues to be stable and supportive of growth. We continue to see the Group’s business performance to be in line with expectations and on track in meeting the key business targets for 2011.”

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Y.Bhg. Tan Sri Dato' Sri Dr. Teh Hong Piow
Chairman of Public Bank
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Budget 2012

For Immediate Release

7 October 2011

Budget 2012

We would like to congratulate the Honorable Prime Minister and Minister of Finance for the people-friendly budget.  Budget 2012 is well-crafted and has provided a string of initiatives, measures and incentives to benefit the Rakyat especially the lower to middle income segments.  This should help to ease the financial burden of the Rakyat amidst the rising cost of living environment which has been much anticipated.

In striking a balance between meeting the needs of the Rakyat and providing impetus for businesses and private sector to be the engine of growth, the Government has taken cognisance in recognising the economic sectors that are primarily driving the economic growth which include the services sector, in particular tourism, banking and financial services, as well as agriculture sector.  We welcome the various measures and incentives provided under Budget 2012 in helping to boost the contribution of these sectors to drive the overall economic growth.

On the GDP growth outlook, in view of heightened uncertainties in the global economy, a 5%-6% projection for 2012 is achievable. The growth is still a respectable performance, given that the Malaysian economy has strong economic fundamentals such as high savings, strong external position and healthy banking sector. Government’s measures to stimulate domestic economic activities, in particular the public and private investments, will continue to support growth.  The Government’s commitment to its fiscal discipline and prudence with the reducing budget deficit to 4.7% of GDP in 2012 from 5.4% in 2011 is commendable.

Budget 2012 has also provided various measures and incentives to Small- and  Medium-Enterprises (“SMEs”) which contribute 31% to the GDP of Malaysia.  Some of these measures and incentives include the RM2.0 billion shariah-compliant SME Financing Fund, SME Revitalisation Fund, SME Emergency Fund and the RM500 million shariah-compliant Commercialisation Innovation Fund.  The banking sector has always been playing its vital role in supporting and nurturing the growth of SMEs to be a significant contributor to our economy. We believe that these funds will further support the growth of SMEs towards this direction.     

On the banking and capital market sector, Budget 2012 further alluded the Government’s effort to promote the development of a more integrated and comprehensive financial services which include, amongst others, the development of the Kuala Lumpur International Financial District, the promotion of the Islamic bonds and treasury management services.

The upward revision of the 10% real property gains tax on disposal of properties held and disposed within two years is indeed complementing the earlier measure instituted by Bank Negara Malaysia in applying the lower loan-to-value ratio for third property financing. We believe that these measures will help to discourage real estate speculative activities.  

Budget 2012, as appropriately guided by its theme of “Welfare for the Rakyat, Well-Being of the Nation”, demonstrates the Government’s concern for the people’s welfare such as affordability of home ownership, improvement in disposable income and relief over the rising cost of living.  It also provides stimulus to further promote domestic private and public investments in growing national wealth, while ensuring human capital development, creativity and innovation are embraced in the nation’s path to growth.

Tan Sri Dato’ Sri Dr. Teh Hong Piow
Chairman

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Y.Bhg. Tan Sri Dato' Sri Dr. Teh Hong Piow
Chairman of Public Bank
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Public Bank Brings Raya Joy to Paediatric Patients

For Immediate Release

9 September 2011

Public Bank Brings Raya Joy to Paediatric Patients

In conjunction with the current Hari Raya Aidil Fitri festive season, Public Bank brought much joy and cheer to 220 children who were warded at the Paediatric Institute of the Kuala Lumpur General Hospital by distributing goodies hampers and duit Raya worth RM18,000.

The presentation was carried out at the Paediatric Institute on 8 September 2011 by the Senior General Manager of Public Affairs Division, Encik Razak Dali on behalf of the Bank’s Founder and Chairman, Tan Sri Dato’ Sri Dr. Teh Hong Piow.

En. Razak Dali said that the presentation from the Bank was a gesture to bring much needed cheer to the young patients who were unable to celebrate the festival with their families at home. It is also the Bank’s way in fulfilling its corporate social responsibility to society and the community it serves. 

It was heartfelt moments to see the young faces all lighted up upon receiving the goodies hampers and duit Raya.  Also present at the distribution ceremony was Dr. Norzila Mohamed Zainudin, Senior Consultant Paediatrician - Paediatrics Respiratory Physician and her team of dedicated nurses who had earlier gave an insightful information on the set-up of the Paediatric Institute and its mission to the public.

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En. Razak Dali presenting a goodie bag and duit Raya to a patient who has just undergone an operation accompanied by Dr. Norzila Mohamed Zainudin and Ms. Nancy Seng, Director of Marketing Communications, Public Bank
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Istismar Account-i

For Immediate Release

22 August 2011

Istismar Account-i

Public Islamic Bank is pleased to announce the launch of a new deposit investment product known as Istismar Account-i to all Muslim and non-Muslim individuals, businesses and organizations.

Istismar Account-i (IA-i) is structured under Shariah concept of Wakalah Bil Istithmar. It refers to an “investment agency” contract where the investor (the depositor) appoints the Bank (the agent) to undertake investment activities on behalf of the depositor for a fee.

The Bank acts in two capacities, i.e. as an agent in accepting deposits from the depositor who plans to invest and as an investment manager in carrying out Shariah compliant investment activities as agreed by the parties.  The Bank as an agent cannot guarantee the profit expected from the investment.

With the introduction of IA-i, the Bank is able to inform the Expected Profit Rate (EPR) at the point of placement, thus, allowing customers to know their expected rate of return on their investment. IA-i offers a competitive rate with flexible range of tenures. During the 3 month launch campaign, a special rate will be given to retail customers. The product is available at all 251 Public Bank/Public Islamic Bank branches throughout the country effective from 16 August 2011.

Public Islamic Bank is confident that the product will be well received as it appeals to both corporate and retail customers.  The launch of IA-i will enhance the competitiveness of the Bank’s deposit products.

Leveraging on its extensive branch network and strength in retail business, the Bank has remained focused on growing Islamic banking business and will continue to introduce more innovative products and services.

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Public Bank Achieves 20.3% Growth in Net Profit in First Half of 2011 and Declares 20% Interim Dividend

For Immediate Release

25 July 2011

Public Bank Achieves 20.3% Growth in Net Profit in First Half of 2011 and Declares 20% Interim Dividend

The Public Bank Group achieved another strong set of results in the first half of 2011 with a record half-year pre-tax profit of RM2.26 billion.

Tan Sri Dato’ Sri Dr. Teh Hong Piow, Chairman of Public Bank said, “The Public Bank Group’s track record of profitability remained strong, with net profit attributable to shareholders growing by 20.3% in the first half of 2011 and maintains the high net return on equity of 27.1% of the Group.”

Tan Sri Teh further added, “Domestic loan growth remained strong, achieving an annualised growth rate of 14.5% whilst gross impaired loan ratio declined to below 1%.”

In view of the Public Bank Group’s strong performance for the period, Tan Sri Teh announced that the Board of Directors has declared a first interim single-tier dividend of 20%, which will result in a total dividend payout of RM700 million.

Highlights of the Public Bank Group’s Performance in the First Half of 2011

  • Pre-tax profit of the Group increased by 18.7% to RM2.26 billion as compared to RM1.90 billion in the previous corresponding period.
  • Net profit attributable to shareholders grew by 20.3% to RM1.71 billion from RM1.42 billion in the previous corresponding period.
  • Annualised net return on equity stood at 27.1%.
  • Earnings per share of 48.8 sen was 20% higher as compared to 40.7 sen in the first half of 2010.
  • Cost to income ratio further improved to 30% and is significantly lower than the industry’s cost-to-income ratio of 46.7%.
  • Total assets increased to RM235 billion as at the end of June 2011.
  • Total loans and advances of the Group expanded by RM10.6 billion or an annualised growth rate of 13.6% to reach RM167.2 billion as at the end of June 2011, driven by strong lending growth in the domestic market at an annualised growth rate of 14.5%.
  • The Group’s total customer deposits increased at an annualised growth rate of 12.9% to reach RM188.3 billion as at the end of June 2011.  The Group’s domestic deposits grew at a stronger annualised growth rate of 14.8%.
  • The gross impaired loans ratio of the Group further improved to below 1% as at the end of June 2011, from 1.14% as at the beginning of the year, significantly lower than the banking industry’s gross impaired loans ratio of 3.0%.
  • The Group’s loan loss coverage increased further to 169.7% and continues to be the highest and most prudent in the Malaysian banking industry.
  • The Group’s Tier 1 capital ratio and risk-weighted capital ratio remain healthy at 9.7% and 13.2% respectively as at the end of June 2011, after accounting for the first interim dividend of 2011.

Highlights of the Public Bank Group’s Performance for the Second Quarter as compared to the First Quarter of 2011

  • Pre-tax profit grew by 5.9% to RM1.16 billion in the second quarter of 2011 as compared to the first quarter of 2011.
  • Net profit attributable to shareholders grew by 6.4% to RM880 million in the second quarter of 2011 as compared to the first quarter of 2011.

Continued Strong Profit Performance
“The strong profit performance of the Public Bank Group for the first half of 2011 was mainly attributed to the healthy growth in net interest and finance income, higher non-interest income coupled with lower credit charges,” said Tan Sri Teh.  

Tan Sri Teh further commented that, “Despite the competitive pressure on interest margins, the Group’s net interest and finance income improved by RM270 million or 10.4 % in the first half of 2011 as compared to the corresponding period of 2010 due to strong growth in loans and customer deposits as well as  the sustained strong asset quality.

Non-interest income of the Public Bank Group recorded a commendable growth of 12.7% as compared to the corresponding period in 2010, mainly driven by higher fee income from Public Mutual’s unit trust business as well as higher investment income.

The Public Bank Group’s loan impairment allowances decreased by 3% despite the strong loan growth in the first half of 2011. This was directly attributed to the continued improvement in asset quality as a result of the Group’s prudent credit policies and effective credit monitoring,  as evidenced by the Group’s low gross impaired loan ratio of below 1%.”

Strong Momentum in Loan Growth
The Public Bank Group sustained its strong loan growth momentum with a RM10.6 billion increase or an annualised growth rate of 13.6% in the first half of 2011. “In particular, domestic loans grew at a stronger annualised growth rate of 14.5%, leading to an increase in the Group’s domestic lending market share to 16.4%,” said Tan Sri Teh.

The lending activities of the Public Bank Group remained focused on the retail sector, with loans to mid-market commercial enterprises as well as loans for the financing of residential properties and purchase of passenger vehicles accounting for 85% of the total loan portfolio of the Group as at the end of June 2011. In particular, the Group’s residential properties financing grew at an impressive annualised rate of 16.7% in the first half of 2011.  

Tan Sri Teh added that, “Public Bank continued to sustain its market leadership position in domestic lending for residential mortgages, commercial property financing and passenger vehicles financing with market shares of 17.7%, 34.0% and 25.8% respectively.”

In the first half of 2011, the Public Bank Group’s domestic loan approvals for residential properties rose at an impressive rate of 17% as compared to the corresponding period in 2010. The Group continued its strong support of the Government’s effort to promote SME activities with the approval of RM5.7 billion of loans to domestic SMEs, accounting for more than 21% of the Group's total domestic loans approved of RM26.9 billion in the same period.

Sustained Strong Asset Quality
Tan Sri Teh highlighted that, “The Public Bank Group has not only maintained its top ranking in asset quality amongst its peers, but also further improved its gross impaired loans ratio from 1.14% as at the beginning of the year to below 1% as at the end of June 2011, significantly lower than the Malaysian banking industry’s gross impaired loan ratio of 3.0%.”

The strong asset quality of the Public Bank Group is due to, inter alia, its prudent lending policies and strong risk management practices, its affluent customer base, as well as the prompt and timely loan restructuring and recovery efforts undertaken by the Group.

The Public Bank Group's loan loss coverage ratio also continue to remain one of the highest at 169.7%, as compared to the banking industry's coverage ratio of 92.2% despite that more than 90% of the impaired loans outstanding are secured. In line with BNM’s Guidelines to maintain a minimum of 1.5% collective assessment, the increase in the Group’s loan loss coverage was a result of setting aside additional collective assessment allowance for strong loan growth while maintaining a stable level of impaired loan.

Healthy Growth of Domestic Customer Deposits
The customer deposits of the Public Bank Group grew at an annualised growth rate of 12.9% in the first half of 2011. In particular, domestic customer deposits grew at a stronger annualised growth rate of 14.8%.

“The Group’s domestic core customer deposits grew at an annualised growth rate of 13% in the first half of 2011, as compared to the domestic banking industry’s core customer deposits annualised growth of 8.5%,” said Tan Sri Teh. The strong domestic core deposit growth of the Group was mainly supported by steady inflows of deposits, particularly fixed deposits and savings deposits which grew at an annualised growth rate of 13.5% and 14.1% respectively in the first half of 2011, outperforming the Malaysian banking industry’s annualised 8% growth in both fixed deposits and savings deposits.

Expansion of Overseas Operations
The Public Bank Group’s overseas operations contributed 7% of the Group’s pre-tax profit for the first half of 2011. Cambodian Public Bank Plc (“Campu Bank”), a wholly-owned subsidiary of Public Bank reported a strong growth in pre-tax profit of 33% to USD13.4 million in the first half of 2011 as compared to USD10.1 million in the corresponding period in 2010. Campu Bank remains one of the largest banks in Cambodia by balance sheet size.

“The Public Bank Group remains committed to expanding its overseas operations, particularly the Group’s Hong Kong and Cambodian operations. The Group currently has a network of 83 branches in Hong Kong and 3 branches in Shenzhen in the People’s Republic of China, with further plans to open 3 new branches in Hong Kong by the end of 2011. In Cambodia, the Group has 21 branches, with another 6 branches targeted to be opened in the second half of 2011,” said Tan Sri Teh.

Growth in Fee-based Income
The Public Bank Group continued to develop its fee-based income from unit trust, bancassurance and wealth management products, in order to further enhance the Group’s profitability and return on equity.

Tan Sri Teh said, “The Group’s unit trust management business through our wholly-owned subsidiary, Public Mutual, continued to show commendable performance with a pre-tax profit growth of 24% in the first half of 2011, and maintained its market leadership position with RM44.4 billion of net assets under management, accounting for an overall market share of 44%.”

Public Mutual’s market share in the equity and Islamic unit trust fund sectors stood at 60% and 58% respectively. Net assets under management increased by 21.7% to RM44.4 billion as at the end of June 2011 as compared to RM36.5 billion a year ago. Public Mutual currently manages 86 funds with more than 100 billion units in circulation. Leveraging on the Public Bank Group’s large branch network and a strong unit trust consultant force, Public Mutual aims to further expand its customer base, which currently stands at over 2.5 million accounts.

2011 marks the fourth year of the Public Bank Group’s strategic alliance with the ING Group on bancassurance distribution. The Public Bank Group will continue with its efforts to further build the infrastructure to drive the expansion of the Group's bancassurance business to increase its fee-based commission income in the long run.

Tan Sri Teh added that, “Public Takaful Ehsan Berhad, the joint venture family takaful business between ING Management Holdings (Malaysia) Sdn Bhd and the Public Bank Group, which was launched on 5 April 2011, is also expected to contribute positively towards this end and further enhance the Group’s long-term fee-based revenue flows.”

Capital Position Remains Healthy
The Public Bank Group’s capital position remains healthy, with its Tier 1 capital ratio and risk-weighted capital ratio standing at 9.7% and 13.2% respectively as at the end of June 2011, after the payment of the first interim dividend of 2011. The Group is confident that it is well-positioned to meet the minimum requirements of Basel III, with its phased implementation coming into effect from 1 January 2013.

The Public Bank Group will continue to monitor further developments in relation to the Basel III requirements as well as additional regulatory capital requirements to be imposed by Bank Negara Malaysia. This will allow the Group to address the potential impact of such requirements by realigning existing capital management strategies from time to time.

“The Group remains committed to maintaining a healthy level of capital at all times to support the Group’s business growth strategies whilst maximising its shareholder value,” said Tan Sri Teh.

Prospects
The Malaysian economy is expected to grow by 5% to 6% in 2011. The outlook of the Malaysian banking sector, in which the Public Bank Group largely operates in, remains positive, supported by the strong economic fundamentals, robust domestic demand and the roll-out of the Economic Transformation Programme.

Tan Sri Teh emphasised that, “The Public Bank Group will continue to focus on its core retail banking and financing business whilst maintaining its prudent credit policies, and further improve on its cost efficiency. The Group expects its strong asset quality to be sustained, and will continue to leverage on the strong PB Brand as well as wide and efficient branch network to deliver balance sheet and revenue growth. The Group remains steadfast in its commitment to upholding strong corporate governance and implement sound risk management policies to support long-term growth.”

Tan Sri Teh remarked that, “The Public Bank Group’s performance for the first half of 2011 was satisfactory and in line with expectations. The Group will continue to expand its core banking and financing business with strong credit fundamentals and remain on course to meet its key business targets for 2011. Barring unforeseen circumstances, the Group is expected to maintain its earnings momentum and record satisfactory performance in the second half of 2011.”

Tan Sri Dato’ Sri Dr. Teh Hong Piow
Chairman

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Y.Bhg. Tan Sri Dato' Sri Dr. Teh Hong Piow
Founder & Chairman of Public Bank
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Public Bank's Customers Rewarded With More Than RM800,000 Worth Of Gold In Gold Investment Account

For Immediate Release

23 May 2011

Public Bank's Customers Rewarded With More Than RM800,000 Worth Of Gold In Gold Investment Account

Public Bank presented the Grand, 1st, 2nd & 3rd Prizes to the winners of the “PB Gold Rush” Campaign on 6 May 2011.

A total of 118 prizes comprising 18 monthly prizes of 18 grams of gold per customer were already awarded to the lucky winners each month. The remaining 10 main prizes were presented to the winners by Dato’ Chang Kat Kiam, the Chief Operating Officer of Public Bank Berhad at Menara Public Bank.

The Grand Prize of the “PB Gold Rush” Campaign which is 1kg of gold in Public Bank Gold Investment Account (GIA) valued at almost RM150,000 was awarded to Mr Tan Lai Hoe. Each 1st Prize winner won 500 grams of gold and the 3 winners were Mr Yap Swee Keong, Ms Saw Phek Lean and Mr Teo King Kowang. The 2nd prize winners who each won 334 grams of gold were Ms Kuan Mui Khim, Ms Wong Pick Yii and Mr Mak Chee Seng. The 3rd Prize winners were Mr Teh Kok Yam, Mr Harban Singh A/L Tara Singh and Encik Ahyat Khalissabri Bin Ishak, each of them won 250 grams of gold.

Dato’ Chang expressed his heartiest congratulations to all winners and also thanked them for their patronage and support.

“This campaign had received overwhelming response from our new and existing customers with more than 350,000 entries. The Bank is continuously looking to reward our loyal customers with more exciting prizes and promotional programmes”, added Dato’ Chang.

Currently the Bank’s latest campaign “U $ave V Reward” is open to all new and existing individual current and savings account customers with up to RM2 million cash rewards up for grabs. The Bank is currently also offering limited edition 24k gold-plated gifts for those who invest in the PB Investment Prosperity Campaign.

To find out more about the Bank’s latest promotions and campaigns, please visit your nearest Public Bank branch, call free phone at 1-800-22-9999 during working hours or log on to Public Bank’s website at www.pbebank.com.

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Public Bank's Credit Cardmembers Win Free 1 Year Credit Card Bill Worth RM20,000 in PB Card Pays For Your Bill Contest

For Immediate Release

19 May 2011

Public Bank's Credit Cardmembers Win Free 1 Year Credit Card Bill Worth RM20,000 in PB Card Pays For Your Bill Contest

Public Bank presented 10 Grand Prizes to winners of the PB Card Pays For Your Bill contest on 6 May 2011. The prizes were given away to the winners by Dato’ Chang Kat Kiam, Chief Operating Officer of Public Bank. He expressed his heartiest congratulations to all winners and also thanked them for their full support in using the PB Credit Cards.

There were ten lucky Grand Prize winners for the PB Card Pays For Your Bill contest. The winners who walked away with FREE one year credit card bill worth RM20,000 each were Mr. Chan Hing Yin, En. Kamaruddin bin Mohamed Ismail, Mr. Liew Nyan Foo, Mdm. Loh Yok Peng, Dr. Wolfgang Neuberger, Mr. Ng Kian Yong, YAM Raja Nazhatul Shima, Mdm. Song Yok Zhen, Mdm. Tan Lean Bee and Mr. Wong Hon Men.

Dato’ Chang said that the campaign had generated phenomenal response from new and existing cardmembers with more than 25,000,000 eligible entries. The Bank has recently launched the “Swipe More & Get Rewarded with PB Credit Card” promotion from 1 March 2011 to 31 July 2011. This 5-month new campaign offers 8% Cash Back to Cardmembers who swipe a minimum of eight times with a minimum of RM80 in a single receipt with PB cards in a tracking month. Alternatively, Cardmembers who swipe a minimum of 12 times with a minimum of RM80 in a single receipt with PB Cards in a tracking month are qualified for the 12% Cash Back. Maximum Cash Back per Cardmember is RM120 per month. Total of RM500,000 Cash Back is available per month based on first-come-first-serve basis. To participate, a one time SMS registration is required. SMS “PBCB 16-digit credit card number” to 32968. Not a PB Card Cardmember yet? Sign up now to enjoy cash activation rewards of up to RM60 or enjoy 0% Finance Charge for eight months from card approved date. Access www.pbebank.com for more information.
 

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Public Bank Achieves 21% Growth in Net Profit in First Quarter of 2011

For Immediate Release

18 April 2011

Public Bank Achieves 21% Growth in Net Profit in First Quarter of 2011

I am pleased to announce that the Public Bank Group achieved a strong start to 2011 with net profit attributable to shareholders of RM828 million for the first quarter of the year, 21% higher as compared to RM685 million in the corresponding quarter in 2010. The Group’s quarterly pre-tax profit continues to surpass the billion ringgit mark, with pre-tax profit of RM1.10 billion for the first quarter of 2011, 19% higher than the corresponding quarter in 2010.

The Public Bank Group achieved an earnings per share of 23.6 sen for the first quarter of 2011 and an annualised net return on equity of 26.4%.

The Public Bank Group’s domestic loan base grew healthily by 3.6% in the first quarter of 2011 as compared to the domestic banking industry’s loan growth of 1.7% in the first two months of 2011.

Highlights of the Public Bank Group's Performance in the 1st Quarter of 2011

  • Pre-tax profit of the Group grew by 19% to RM1.10 billion as compared to RM923 million in the previous corresponding quarter.
  • Net profit attributable to shareholders grew by 21% to RM828 million as compared to RM685 million in the previous corresponding quarter.
  • Annualised net return on equity stood at 26.4%.
  • Earnings per share of 23.6 sen was 20% higher as compared to 19.7 sen in the first quarter of 2010.
  • The Group remains the most cost efficient with its cost-to-income ratio maintained at 30.4%, as compared to the banking industry’s cost-to-income ratio of 46.7%.
  • Total assets increased to RM229 billion as at the end of March 2011.
  • Total loans and advances of the Group grew by RM5.1 billion or 3.2% to reach RM162 billion as at the end of March 2011, driven by strong domestic loan growth of 3.6% in the first quarter of 2011.
  • The Group’s total customer deposits increased by 2.0% to reach RM180 billion as at the end of March 2011. The Group's domestic core customer deposits grew at a stronger 3.0%, as compared to the domestic banking industry’s core customer deposits growth of 1.8% for the first two months of 2011.
  • The gross impaired loans ratio of the Group further improved to 1.05% as at the end of March 2011, from 1.14% as at the end of 2010. This compares favourably with the banking industry's gross impaired loans ratio of 3.3%.
  • The Group's loan loss coverage increased further to 155.4% and remains the highest and most prudent in the Malaysian banking industry.
  • The Group’s Tier I capital ratio and risk-weighted capital ratio remain healthy at 9.5% and 13.0% respectively as at the end of March 2011.

Strong 1st Quarter Profit Performance
The strong profit performance of the Public Bank Group for the first quarter of 2011 was mainly attributed to the strong growth in net interest and finance income, higher non-interest income whilst loan impairment allowance charges remained stable.

The Group’s net interest and finance income improved by RM136 million or 10.8% in the first quarter of 2011 as compared to the corresponding quarter in 2010, on the back of the strong organic growth in loans and core customer deposits.

Non-interest income of the Group increased by over 9% as compared to the corresponding period in 2010, mainly driven by higher income from the unit trust and stockbroking businesses and a widening and broader fee-based business.

The Public Bank Group’s loan impairment allowances remained stable in the quarter. This was attributed to the continued improvement in asset quality as demonstrated by the further reduction in the Group’s impaired loan ratio of 1.05%, resulting from the continued pursuit of prudent credit policies and effective credit monitoring and management.

Strong Growth in the Group’s Domestic Lending Portfolio
The Public Bank Group continued to record a strong increase in total loan and advances of RM5.1 billion, a 3.2% growth for the first quarter of 2011, to reach RM162 billion as at the end of March 2011. Domestic loan growth for the quarter was stronger at 3.6%, or an annualised rate of 14.6%, with the Group’s domestic market share of loans and advances standing at 16.2% as at the end of February 2011.

The lending activities of the Public Bank Group remained focused on the retail sector which accounted for 85% of the Group’s total loan portfolio, mainly comprising loans to mid-market commercial enterprises as well as loans for the financing of residential properties and the purchase of passenger vehicles. In particular, the Group’s loan portfolio for property financing grew at an impressive annualised rate of 16.8% in the first quarter of 2011. Public Bank continued to sustain its market leadership in its core lending businesses with domestic market share of residential mortgages, commercial property lending and passenger vehicles financing of 17.5%, 34.1% and 25.6% respectively as at the end of February 2011.

For the first quarter of 2011, the Public Bank Group’s domestic retail loan approvals increased by 10% as compared to the corresponding period in 2010, with housing loan approvals growing at a higher 17%.  The Group also approved a total of RM3.0 billion of loans to domestic SMEs, 11% higher than the corresponding quarter in 2010, with approvals of SME loans accounting for 24% of the Group's total domestic loans approved of RM12.6 billion in the first quarter of 2011.

Healthy Asset Quality Maintained
The Public Bank Group's asset quality remained healthy as at the end of March 2011, with the Group’s gross impaired loans ratio improving further to 1.05% as at the end of March 2011, as compared to 1.14% as at the end of 2010. This compares favourably to the domestic banking industry's gross impaired loans ratio of 3.3% as at the end of February 2011.

The sound asset quality of the Public Bank Group is due to, inter alia, its prudent lending policies and strong risk management practices, its affluent customer base, and the prompt and timely credit recovery efforts undertaken by the Group.

As at the end of March 2011, the Public Bank Group's loan loss coverage ratio stood at 155.4%, which is significantly higher and more prudent than that of the banking industry's coverage ratio of 89.6% as at the end of February 2011, despite that more than 90% of the impaired loans outstanding are secured. Guided by Bank Negara Malaysia’s requirement to maintain a minimum 1.5% collective allowance, the increasing loan loss coverage was the result of higher collective allowance set aside for the strong loan growth in the first quarter of 2011.

Sustainable Growth in Domestic Core Customer Deposits
Core customer deposits, which represent a stable funding base of the Public Bank Group, grew by RM3.0 billion or 2.1% in the first quarter of 2011 to reach RM147 billion as at the end of March 2011. Domestic core customer deposits grew by a stronger 3.0% in the quarter, as compared to the domestic banking industry’s core customer deposits growth of 1.8% for the first two months of 2011. In particular, domestic fixed deposits and savings deposit of the Group grew by 3.6% and 4.4% respectively in the first quarter of 2011, significantly above the banking industry’s fixed deposits and savings deposit growth rates of 0.1% and 2.3% respectively in the first two months of 2011.

With core customer deposits growing healthily in tandem with the high loan growth rate, the Public Bank Group's liquidity position remains stable with net loans to deposits ratio standing at 88.1% as at the end of March 2011.

Expansion of Overseas Operations
The Public Bank Group's expansion plan in its overseas operations remains focused on the Group’s Hong Kong and Cambodian operations. The Public Bank Group currently has a network of 83 branches in Hong Kong and 3 branches in Shenzhen in the People’s Republic of China, with a further 3 branches in Hong Kong to be opened in 2011. Cambodian Public Bank Plc, a wholly-owned subsidiary of Public Bank, is one of the largest banks in Cambodia by balance sheet size. Cambodian Public Bank Plc presently has a total of 21 branches, with another 6 branches targeted to be opened in 2011.

Fee-based Income Growth Remains Upbeat
The Public Bank Group continues to develop its fee-based income from unit trust, bancassurance and wealth management products, in order to further enhance the Group’s profitability and return on equity.

Public Mutual Berhad, the Public Bank Group’s wholly-owned unit trust fund management subsidiary, remained the clear market leader in the private unit trust industry with an overall market share of 45%, whilst its market share in equity funds and Islamic funds each stood at 60% as at the end of March 2011. In the first quarter of 2011, Public Mutual’s pre-tax profit grew by 23% to RM77.7 million from RM63.2 million in the corresponding quarter in 2010. Net assets under management stood at RM42.4 billion as at 31 March 2011, 16% higher as compared to RM36.6 billion a year ago. Public Mutual Berhad continues to build and nurture its large force of unit trust consultants, a highly effective distribution channel to drive the Group’s unit trust business, with its unit trust customer base growing to over 2.4 million accounts.

In the fourth year of its strategic alliance with the ING Group on bancassurance distribution, the Public Bank Group will continue with its efforts to build the infrastructure to drive the expansion of the Group's bancassurance business to increase its fee-based commission income. With the recent official launch of ING PUBLIC Takaful Ehsan Berhad, the joint venture family takaful business between ING Management Holdings (Malaysia) Sdn Bhd and the Public Bank Group on 5 April 2011, the Group is set to extend further its fee-based revenue activities.

Capital Position Remains Healthy
The Public Bank Group has always sought to maintain a healthy level of capital to support the growth of the Group’s business, whilst maintaining healthy returns to its shareholders.

The Public Bank Group’s capital position remains healthy, with its Tier I capital ratio and risk-weighted capital ratio standing at 9.5% and 13.0% respectively as at the end of March 2011. The Group is confident that it is well positioned to meet the Basel III minimum capital requirements, with its phased implementation coming into effect from 1 January 2013.

The Public Bank Group continues to proactively monitor the developments in relation to the Basel III requirements as well as additional regulatory capital requirements to be imposed by Bank Negara Malaysia. This allows the Group to address the potential impact of such requirements on the Group’s capital and to realign existing capital management strategies from time to time. The Group remains committed to maintaining a healthy level of capital at all times to support the Group’s business growth strategies whilst maximising its shareholders’ returns.

Prospects
The strong growth of 7.2% registered in 2010 in the Malaysian economy, in which the Public Bank Group largely operates, augurs well for the outlook for 2011. Despite the weaker external demand amidst challenging global economic conditions, the domestic operating environment continues to remain buoyant due to sustainable domestic demand and accommodative policy environment, with the expectation of a 5% to 6% growth in the Malaysian economy in 2011.

The Public Bank Group will continue to pursue its strategy of strong organic business growth, maintaining its superior quality loan portfolio, expand its fee-based income and further improve its productivity. At the same time, the Group will continue with its efforts to further enhance its risk management capabilities, uphold its sound corporate governance practices and further reinforce the strong PB Brand. The encouraging operating environment, both domestically as well as the regional economies in which the Group operates in, will provide further leverage for the Group to sustain its growth trajectory in 2011.

Barring unforeseen circumstances, the Group is expected to continue to record satisfactory performance for the rest of 2011.

Tan Sri Dato’ Sri Dr. Teh Hong Piow
Chairman

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Y.Bhg. Tan Sri Dato' Sri Dr. Teh Hong Piow
Chairman of Public Bank
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Appointment of Mr. Tang Wing Chew as An Independent Non-Executive Director of Public Bank

For Immediate Release

29 March 2011

Appointment of Mr. Tang Wing Chew as An Independent Non-Executive Director of Public Bank

Public Bank has appointed Mr. Tang Wing Chew as an Independent Non-Executive Director with effect from 29 March 2011.

Mr. Tang has more than 45 years experience in the financial services industry, ranging from research, management and project studies, training, mergers and integration, and stewardship of financial institutions.

He joined Bank Negara Malaysia (BNM) in 1966 as an Assistant Economist in the Economic Research Department. During his 18 years of service with BNM, he also served as Manager (Penang branch), Principal (BNM Staff Training Centre) and Manager (Operational Planning Division), where he was responsible for the automation of Kuala Lumpur Interbank Cheque Clearing System in 1984.

Mr. Tang had working experience in two finance companies, where he was the Chief Executive Officer and General Manager (Operations). Mr. Tang had also served as an Executive Adviser and the Chief Executive Officer of an insurance company.

At the Board level, Mr. Tang also served as an Independent Non-Executive Director in two general insurance companies and in a leasing and credit company.

Mr. Tang has also been appointed as an Independent Non-Executive Director of 2 subsidiaries of Public Bank with effect from 29 March 2011 ie. Public Islamic Bank Berhad and Public Investment Bank Berhad.

He is also an Independent Non-Executive Director of Cagamas Berhad and Cagamas Holdings Berhad.

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The newly appointed Member of The Board of Directors, Mr. Tang Wing Chew
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