KUALA LUMPUR (April 25): Bank Rakyat has announced a higher dividend of 15% for its account holders for the financial year ended Dec 31, 2021 (FY21), compared with 13% for FY20.

This will involve a payout of RM429.50 million to 827,066 members and the dividend will be credited from Monday (April 25).

Entrepreneur Development and Cooperatives Minister Tan Sri Noh Omar said despite the challenging environment triggered by Covid-19, Bank Rakyat was still able to maintain the double-digit dividend rate.

"This achievement resulted from Bank Rakyat's commitment to realising the mandate entrusted to strengthen the economic well-being of its members and customers," Noh told a press conference to announce Bank Rakyat's financial performance for FY21 here on Monday.

Noh said Bank Rakyat is always concerned about the needs of its members, of which 30% are made up of individual recipients from the bottom 40% household income group (B40), while 20% are cooperative recipients from the B40 group.

For FY21, Bank Rakyat recorded a profit before tax and zakat of RM1.63 billion and a net profit of RM1.86 billion.

The strong performance was achieved through fundamental strength and focus on core activities despite the economic uncertainty caused by Covid-19, while the net profit was contributed by lower deferred tax liabilities during the year under review.

Meanwhile, Bank Rakyat chairman Datuk Abd Rani Lebai Jaafar said the cooperative bank is on track, following an encouraging 2021 financial performance, driven by the group's financing and investment activities, as well as lower funding costs attributable to the low overnight policy rate.

“In addition, the lower impairment provision in the year, in line with industry trends, also improved the group’s performance.

"This achievement was also driven by the group's net operating income, which increased 3.2% to RM3.52 billion from RM3.41 billion previously, helped by lower funding costs as a result of effective asset liability management, and Current Accounts-i and Savings Accounts-i (CASA) which were higher at RM9.23 billion from RM8.28 billion previously," he added.

Abd Rani said the group also managed to maintain a healthy cost-to-income ratio of below 40%, which was lower than the industry average arising from effective cost management activities.

Going forward, he said Bank Rakyat would continue to focus on new growth areas, especially to harness the potential that could be explored in business and operations through digital transformation to create long-term value for shareholders.

He said that currently, Bank Rakyat's strategic plan 2025 (BR25) is in the implementation phase for which in 2021, all the 46 programmes planned were realised according to plan.

"These achievements included the establishment of 10 small and medium enterprise business and cooperative centres which are currently operating throughout the country, including in Sabah and Sarawak.

"Besides, Bank Rakyat has also launched the iRakyat mobile banking application, which is one of the key achievements of the digitalisation action plan through BR25," he added.

As at Dec 31, 2021, Bank Rakyat had a total market capitalisation of RM21 billion, with the group's total assets amounting to RM115.06 billion.