CIMB ready to provide more funding support to SMEs in Asean countries


19 May, 2016
As appeared in

CIMB has set a strategy to provide more financial support to small and medium-sized companies in Asean countries.

As for the credit risk, Zafrul Aziz, chief executive officer of the Kuala Lumpur-based bank, said recently that CIMB may not know all about individual SMEs, but it knows about what are promising industries.

He was giving an exclusive interview to a group of Thai media on the sidelines of the Asean Business Club Forum in Singapore.

CIMB, positioning itself to be a leading Asean bank, plans to take advantage of increasing intra-Asean trade and investment.

Major Thai banks such as Bangkok Bank, Kasikornbank and Siam Commercial Bank have been moving aggressively to support businesses related to trade between Thailand and neighbouring countries.

CIMB will look for lending opportunities in the healthcare and restaurant chain industries.

“We will avoid commodities,” he said.

Commodities such as oil palms and rubber sheets have been facing lower prices.

CIMB’s SME portfolio was small as it had spent the past several years aggressively pursuing new businesses. Now it is focusing on consolidation and cost-cutting.

According to the ERIA SME research working group, SMEs account for more than 96 per cent of all enterprise and 5-85 per cent of domestic employment in Asean countries.

Their contribution to GDP is 30-53 per cent and to exports is 19-31 per cent.

There is still a significant gap in SME’s access to finance in emerging Asean countries, such as Vietnam, Laos, Cambodia and Myanmar.

SMEs in Singapore are in the best position to access funds, followed by those in Malaysia, Thailand and Indonesia.

The ERIA report also called for the promotion of innovative and alternative financing sources, such as the domestic and regional networks of equity funds, venture capital funds, angel capitalists and crowdfunding platforms.