Banking
From The Report: Brunei Darussalam 2013
View in Online Reader

The banking sector has performed well historically, with a 70% increase in assets over 12 years. From 2007 to June 2012 total commercial banking assets in the Sultanate grew 30.5% to BN$20.1bn ($15.7bn). The sector is currently facing a period of re-adjustment, absorbing the implications of a more mature regulatory environment and looking at ways to support the government’s development plans. In a moderately sized market with limitations on the opportunities to boost loan growth in place, the challenges for commercial banks remain substantial. Nonetheless, most of the players remain bullish, devising new strategies and products to capture a greater share of the retail and corporate segments of the market.

This chapter contains interviews with Dato Haji Mohs Rosli, Managing Director, Autoriti Monetari Brunei Darussalam; and Pierre Imhof, CEO, Baiduri Bank.

Articles from this Chapter

Overview

Regulatory changes: Reforms have made for a sector in transition, with a need to refocus
OBG
plus

The banking sector is currently facing a period of readjustment, absorbing the implications of a more mature regulatory environment and looking at ways to support the government’s development plans. In a moderately sized market with limitations on the opportunities to boost loan growth in place, the challenges for commercial banks remain substantial. Nonetheless, most of the players in the Sultanate remain bullish, devising new strategies and products to capture a greater share of the retail…

Interview

OBG talks to Dato Haji Mohd Rosli, Managing Director, Autoriti Monetari Brunei Darussalam (AMBD)
OBG
plus

Interview: Dato Haji Mohd Rosli How would you assess the performance of Brunei Darussalam’s banking sector in 2012? DATO HAJI MOHD ROSLI: The banking sector has remained sound and stable. The banks in Brunei Darussalam are well capitalised and have met the Basel III Tier I common equity capital ratio requirement. The banks also continue to hold high levels of liquidity. Credit risk management has improved, which is evident from the declining trend in banks’ non-performing assets ratios over…

Analysis

Credit where it is due: A new bureau is expected to help target lending and improve portfolios
OBG
plus

The biggest development in Brunei Darussalam’s banking sector over the past 12 months is likely the arrival of a new credit bureau. Having begun operations in the fourth quarter of 2012, the bureau is the key tool of Autoriti Monetari Brunei Darussalam (AMBD) for lenders to determine their potential customers’ credit-worthiness. Following on from the work of the Ministry of Finance (MoF), which introduced a number of regulations to curb personal lending, the AMBD, established to take over…

Analysis

International treasury: The sector looks to provide regional financial services
OBG
plus

opportunities for the country. Currently, the banking sector has an average interest margin to gross income of 68.5%, suggesting that fee-based income still plays a relatively small role in boosting their balance sheets. Opportunities to grow this in the corporate segment would, therefore, will be welcome. However, as of now, there are no regional treasury centres in Brunei Darussalam. The country would need to change its regulatory environment and incentive structure to attract such business.…