MONEY MASTER

Key Highlights: Tony Fernandes sees 2025 as a "rebuilding year"  as Capital A restructures to exit PN17 status. Sale of AirAsia’s aviation business to AirAsia X (AAX) for RM6.8 billion  is critical to resolving Capital A’s financial struggles. Regulatory approvals and court rulings pending , with a crucial hearing set for late March. Capital A seeks to cut costs, optimize routes, and restart 14 grounded planes  to reduce cash burn. Saudi Arabia’s PIF rumored to invest RM1 billion in AirAsia Group Bhd (AAGB)  as part of the restructuring deal. BigPay, Capital A’s fintech unit, is struggling, and a partner is sought to take over leadership. Tony Fernandes’ Vision: A Year of Rebuilding Capital A Bhd, the parent company of  AirAsia , is at a crucial turning point in its financial recovery. CEO  Tan Sri Tony Fernandes  has laid out an aggressive plan to restore profitability, exit  PN17 status , and  rebuild the airline’s competitive edge  in...

Key Takeaway: Project Nexus aims to enable instant, seamless cross-border payments globally, with full implementation expected by 2027 . The Bank for International Settlements (BIS) , together with Bank Negara Malaysia (BNM) and central banks from Singapore, Thailand, the Philippines, and India , is advancing Project Nexus to streamline cross-border instant payment systems (IPS) . Highlights of Project Nexus: Unified Cross-Border Payments IPS networks , like Malaysia’s DuitNow , will connect seamlessly via a single unified network , enabling instant and secure fund transfers across borders using proxies like mobile numbers . Phase 3 Milestones Phase 3, concluding in 2024, delivered a comprehensive framework , including: Governance roadmap Revenue model Technical specifications for the Nexus system. Phase 4 Objectives The next phase involves live implementation , with immediate priorities to: Establish the Nexus Scheme Owner (NSO) in Singapore to manage the system. Develop the Nex...

Key Takeaway: Standard Chartered has seen a wave of resignations from its corporate finance division in India and Singapore, as dealmaking activity intensifies and rival firms seek talent. Standard Chartered Plc is facing significant departures from its financing and credit teams across India and Singapore, with four bankers in India and two in Singapore leaving in the past six months. Notable exits include Karan Maroo and Vikash Bihani in Mumbai, as well as Jay Sheth in Singapore. Bihani recently joined Mashreqbank PSC as head of investment banking, following a 15-year tenure at Standard Chartered. The departures come amid a global restructuring led by CEO Bill Winters , aiming to integrate the bank’s credit markets and mergers advisory teams. This restructuring aligns with Standard Chartered's focus on increasing relationship managers in India to expand wealth management, particularly targeting smaller towns. Despite these changes, Standard Chartered remains a leading pl...

Citigroup Inc. , the only major US bank with a significant presence in Lebanon, has relocated some of its staff to Turkey as the conflict between Hezbollah and Israel intensifies. The move comes in response to escalating military clashes, including Israeli air strikes in Beirut , where Citigroup’s office is located. While Citigroup continues to service its clients in Lebanon, over 20 employees remain in the country. The bank, which prides itself on maintaining operations in volatile markets, took precautionary measures to ensure the safety of its staff, according to sources familiar with the matter. "The safety and well-being of our people remains our top priority," a Citigroup spokesperson said in an email, adding that the company is closely monitoring the situation and has resources in place to support its employees and their families. Citigroup has a long history in Lebanon, dating back to the 1950s , although it temporarily withdrew in 1987 due to the civil war. The b...

  Bank Negara Malaysia (BNM) stated that Malaysia’s financial institutions, including insurers, continue to support economic growth , with businesses and households demonstrating resilience as the ringgit strengthens . This is in line with the projected improvement in business resilience for the second half of 2024, according to the Financial Stability Review First Half 2024 report. BNM noted that input costs are expected to ease due to lower commodity prices and the appreciating ringgit, further bolstering household resilience supported by favorable economic and labor market conditions . The banking sector reported an aggregate total capital ratio of 18.4% , with capital buffers amounting to RM136.1 billion , well above the regulatory minimum. Meanwhile, the insurance and takaful sectors achieved an aggregate capital adequacy ratio of 227% , with excess capital buffers of RM37.4 billion . BNM emphasized the importance of operational resilience in the financial system...

 The UK government has granted banks more time to investigate payments they suspect might be fraudulent, offering a reprieve to lenders ahead of new rules requiring them to reimburse scam victims . Previously, banks had to process such payments by the next business day, but the new law will give them an extra 72 hours if there are "reasonable grounds" for suspicion. “This will allow payment providers to reach out to customers and provide the advice needed to prevent criminals from stealing their money,” said Ben Donaldson , managing director of economic crime at UK Finance. The change comes in response to a global surge in authorised push payment (APP) fraud , where criminals trick victims into sending money to external accounts. Losses in the UK alone reached £460 million in 2023. Under new rules effective Oct 7, British banks, fintechs, and payment firms will be required to reimburse fraud victims within five days , with the cost shared between the sending and receiving ...

  Analysts are forecasting a significant boost in Affin Bank Bhd's deposits following the Sarawak government's decision to increase its ownership stake in the bank to 31% , making it the largest shareholder. This move is expected to enhance the bank's current account and savings account (CASA) contributions. CIMB Securities upgraded its fair value estimate for Affin Bank to RM4.30 , up from RM4.00, while maintaining a “buy” recommendation. The firm anticipates new CASA contributions of at least RM4 billion in FY2025, allowing the bank to release more expensive fixed deposits. TA Securities echoed this optimism, noting that Affin Bank's strategic positioning as a financing vehicle for the Sarawak government could provide significant opportunities in loan growth , advisory roles , and infrastructure projects . Additionally, the expected salary increases for Sarawak’s civil servants could boost the bank’s CASA deposit base. Affin Bank is also set to benefit from t...

China is considering injecting up to one trillion yuan (US$142 billion) into its largest state banks to enhance their ability to support the country’s struggling economy, according to sources familiar with the matter. This move, potentially funded through the issuance of new special sovereign bonds, would mark the first major capital injection into China’s banks since the 2008 global financial crisis . Despite the fact that China’s top six banks already exceed capital requirements, the injection is aimed at replenishing capital after recent cuts in mortgage rates and key policy rates intended to revive the economy. These banks, including Industrial & Commercial Bank of China Ltd (ICBC) and Bank of China Ltd (BOC) , have been grappling with record-low margins , shrinking profits, and rising bad debt due to economic pressures. Li Yunze, China’s top banking regulator, hinted earlier this week that measures would be taken to boost core Tier 1 capital at the nation’s major banks, a...

Mizuho Financial Group Inc.'s asset management division, Asset Management One Co, is preparing to launch an active fund focused on large-cap Japanese stocks by the end of the year, aiming to draw investors back to domestic markets. This initiative comes amid a trend where many investors have been favoring foreign equity index products. Key Takeaways: Fund Target and Strategy : Asset Management One Co plans to grow the investment trust to ¥500 billion (approximately $3.4 billion) over the next five to ten years. The fund will focus on about 50 large-cap Japanese stocks, aiming to capitalize on an anticipated return of interest in the domestic market. Shift from Savings to Investments : The Japanese government is actively encouraging citizens to move their financial assets from savings to investments to support economic growth. This effort is reflected in the growing popularity of new tax-free investment accounts, such as Nisa, which has driven the net asset value of publicly offered...

Norinchukin Bank, Japan’s largest agricultural bank, reported a substantial loss of ¥413 billion (RM12.57 billion) in the fiscal first quarter. This loss results from the bank's unsuccessful bets on interest rates, leading to the offloading of unprofitable bonds. Key Points: Quarterly Performance: The loss for the three months ended June 30 contrasts sharply with a net income of ¥63.9 billion in the same period last year. The bank has projected a net loss of about ¥1.5 trillion for the fiscal year ending in March 2025. Investment Strategy: Norinchukin is unwinding approximately US$67 billion (RM308.03 billion) in US and European government bonds this fiscal year. The bonds became unprofitable due to interest rate hikes by the US Federal Reserve and other central banks, which increased funding costs. Financial Challenges: The bank’s foreign-exchange funding strategy resulted in a negative carry, where interest expenses surpassed bond returns. Norinchukin is restructuring its US$361 ...

  Kuwait Finance House (Malaysia) Bhd (KFH Malaysia), the first foreign Islamic lender in the country, is planning to exit Malaysia after nearly two decades of operations, according to industry sources. Strategic Refocus “It is exiting to focus entirely on the Middle East,” an industry source said. KFH Malaysia is wholly owned by Kuwait Finance House, the largest bank in Kuwait and the second-largest Islamic bank globally. Earlier this year, Kuwait Finance House merged with Ahli United Bank of Kuwait. Limited Presence in Asia Apart from Malaysia, Kuwait Finance House does not have a presence elsewhere in Asia. The group was not immediately available for comment. KFH Malaysia is one of only two remaining stand-alone foreign Islamic banks in the country, the other being Al Rajhi Banking & Investment Corp (Malaysia) Bhd. The bank has faced challenges in gaining market share in Malaysia's competitive market since its establishment in August 2005. Currently, there are 17 Islamic len...

HSBC Holdings Plc, Standard Chartered Plc, and Singaporean banks are set to report earnings amid a backdrop of tepid loan growth, presenting challenges for their financial performance. Key Points: HSBC & Standard Chartered: Net Interest Margins: Hong Kong banks, including HSBC and Standard Chartered, are under pressure due to falling Hibor rates, impacting net interest margins (NIMs). Leadership and Revenue: HSBC’s incoming CEO Georges Elhedery faces the challenge of increasing revenue in a falling rate environment and is expected to focus on cost-cutting efforts. Standard Chartered is likely to meet the higher end of its net interest income guidance for 2024 due to a supportive rate environment. Buybacks: Both banks are anticipated to announce new share buybacks, with Standard Chartered expected to announce a US$1 billion share buyback. Singapore Banks (OCBC & UOB): Loan Growth: Overall lending may pick up in the second half of the year, although weak business demand could...

There are 159 roles and 157 skills that will be in demand for the next three years in Malaysia’s financial sector, according to the Future Skills Framework (FSF), a joint industry document launched on Monday. Key Takeaways: Future Skills Framework (FSF) : Developed by the Asian Institute of Chartered Bankers, Malaysian Insurance Institute, and the Islamic Banking and Finance Institute Malaysia, the FSF categorizes skills into Prime Skills Clusters with 142 job-specific technical skills and Power Skills Clusters with 15 fundamental competencies across all roles. Emerging Roles and Skills : The framework includes "emerging roles" such as artificial intelligence and machine learning in the Prime Skills Cluster, and "sustainability awareness" in the Power Skills Cluster. Career Development : The FSF highlights potential career development pathways and provides access to nearly 1,000 capacity-building programs, serving as a reference point for policymakers, employers, an...