Page 66 - Bank Muamalat_AR24

64 BANK MUAMALAT MALAYSIA BERHAD

RETAIL BANKING

OUTLOOK & STRATEGY

Looking ahead, the OPR rate is expected to remain stagnant, likely contributing to higher costs of funds and continued
Net Interest Margin (NIM) compression. Intense competition amongst banks is also projected to persist. At a global level,
geopolitical instability and other macroeconomic headwinds are expected to exert downward pressure on consumer
confidence, while the ongoing cost-of-living crisis may discourage investment activities and affect customers’ ability
to service their financings. Although green shoots of economic recovery are visible, these combined factors contribute
to a cautious outlook for retail banking over the near-to-mid-term.

To proactively offset the impact of this challenging operating environment, the Bank’s RBD is poised to accelerate
its business growth through strategic portfolio rebalancing, focusing on higher-yielding products. A key focus will be
on diversifying customer segments and increasing wallet share by targeting high-earners and high net worth individuals.
This involves improving product holdings for both existing and new customers, particularly through bundled offerings
such as Takaful and saving plans. RBD will also aggressively target the Micro and Small Medium Enterprise (MSME)
segment for deposits and payment solutions, whilst reinforcing its position as the preferred bank for Muamalat First (M1) and
DRB HICOM Group staff and customers, extending engagement to their families and friends. Fee-based business growth
will be pursued through a holistic lifestyle wealth management approach, offering 360-degree comprehensive Islamic
wealth and investment products, alongside expanding payment solutions through an increased merchant terminal network
by 1,500 units and the introduction of cost-efficient terminals like the Soundbox.

Operational finesse and digital transformation will be paramount. The division is committed to embracing technology,
innovation, and workforce transformation as it adapts to the new normal and caters to the evolving needs of our customers.
The goal is to transform service delivery through digital channels, segment digitalisation, and increased customer
involvement initiatives. This transformation will lead to greater scale, cost efficiency, and an improved reach in acquiring
and serving customers, partners, merchants, and small businesses.