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Wednesday December 13, 2006

Saudi’s Al Rajhi on aggressive expansion


PETALING JAYA: Barely two months after its soft launch in Malaysia, Saudi Arabia’s Al Rajhi Bank has quietly opened nine branches in the Klang Valley. 

At least six more outlets are slated to open early next year in Kota Damansara, Subang, Puchong, Ampang Jaya, Bukit Bintang and Petaling Jaya, Al Rajhi Bank Malaysia said in an e-mail reply to queries from StarBiz. 

Currently under renovation, the branches “would be operational soon’’, it said. 

The nine branches are located in Jalan Ampang (the main branch), Taman Tun Dr Ismail, Bangsar, Cheras, Seri Hartamas, Kelana Jaya, Kajang, Shah Alam and Klang. 

It is learnt that the bank also has plans to offer Islamic banking services beyond the Klang Valley next year and is eyeing Johor Baru, Malacca and Penang. 

In five years, the bank’s vision is to have 50 branches throughout the country. It is said to have employed more than 300 people, including eight division heads. 

That is how aggressive the 50-year-old bank is. Al Rajhi is a major player in Saudi Arabia and claims to be the largest Islamic bank in the world with a market capitalisation of US$80bil as at end-March this year. 

Its core business in Saudi Arabia is in wholesale, retail, commercial banking and investment banking, all of which are guided by syariah principles. The bank has nearly 600 branches in Saudi Arabia, 1,400 automated teller machines (ATM) and over 8,00 merchant terminals. 

Al Rajhi took two years to open its first branch in Malaysia after being awarded a licence in 2004 by Bank Negara. 

Al Rajhi is also the second of three foreign banks that were awarded Islamic banking licences by the central bank. First to set up shop in Malaysia was Kuwait Finance House, which opened its doors last year. 

Next month, the third player, a Qatar-led financial services consortium, is planning to open for business in Malaysia. It is currently assembling a team of professionals for its Malaysian operations. 

“Malaysia marks the group’s first foray into the international banking scene, which coincides with its international expansion plans,” Al Rajhi said, adding that it aspired to introduce a “new Islamic banking experience” to a wider Asian market. 

Leveraging on its track record in Islamic banking, the bank believes it would “play a catalytic role in support of Malaysia’s plans to evolve into a vibrant Islamic financial hub for the South-East Asian region’’. 

In Malaysia, the bank said it was offering a suite of products that included personal financing, debit-ATM card, charge card with Visa Wave technology, current and savings accounts as well as fixed investment account. 

Moving ahead, the bank said it hoped to introduce a broader suite of banking products to cater to a more varied customer base. 

Al Rajhi was recently named the best bank in Saudi Arabia for 2006 by The Banker magazine. 

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