Domestic banks laud initiatives, measures to rebalance, restructure and reform economy

PETALING JAYA: Domestic banks laud initiatives unveiled in Budget 2025 and commend the government’s steps in rebalancing, restructuring and reforming the economy.

UOB Malaysia welcomes the introduction of the New Investment Incentive Framework, which marks a strategic shift towards promoting high-value economic activities, particularly in sectors such as electrical and electronics (E&E) and artificial intelligence (AI).

CEO Ng Wei Wei said the framework aims to create high-paying jobs and foster regional economic development by incentivising education in emerging technologies and strengthening local supply chains through tax benefits for joint ventures between multinational enterprises and local suppliers.

“Additionally, the emphasis on environmental, social, and governance (ESG) principles through incentives for sustainable practices demonstrates a commitment to balancing economic growth with environmental responsibility.

“The introduction of a carbon tax on Malaysia’s iron, steel, and energy sectors by 2026 is a significant step towards incentivising low-carbon technologies.

“Aligned with other international ESG regulations such as European Union’s Carbon Border Adjustment Mechanism, this measure demonstrates the government’s firm commitment to decarbonisation,” she said.

Ng said this comprehensive budget lays a solid foundation for resilience and growth, and UOB Malaysia is committed to supporting Malaysia in its next development phase.

CIMB Group CEO Novan Amirudin laud the government’s bold move to creatively expand the tax base by introducing carbon and dividend taxes and expanding the scope of the Sales and Service Tax.

“This, alongside the reduction of blanket subsidies and implementation of strategic blueprints like NETR, NIMP and JS-SEZ will give the government more firepower to spend as needed to boost our economy, pursue shared prosperity and further spur foreign direct investments,” he said.

Hong Leong Bank Bhd supports various incentives to drive investment and businesses, which align with the Public-Private Partnership Master Plan 2030, which includes a financing mechanism and initiatives to nurture SMEs to become regional champions.

“We also applaud the efforts to strengthen the financial ecosystem with a focus on renewables and the green economy. Implementing new and ongoing infrastructure projects and realising various approved investments will continue to underpin expansion in private investment and create more job opportunities,“ said group managing director and CEO Kevin Lam.

He said continuing cash assistance to targeted segments is a welcome initiative. This, coupled with earlier-announced civil servant pay hikes, is expected to help further alleviate the rising cost of living pressures.

This aligns with the government’s priority of raising the floor by improving the quality of life. Going forward, this should bode well for consumption and the services sector.

“Overall, HLB is confident that Budget 2025 will contribute to the long-term growth and sustainability of the Malaysian economy. We look forward to actively supporting the government’s vision for a more prosperous and inclusive future,“ Lam said.

Maybank president and group CEO Datuk Khairussaleh Ramli welcomes the call for further dialogue on the scoping of SST, which will be expanded to commercial businesses, including fee-based financial services and the introduction of dividend tax.

He said the banking industry’s priority remains to deliver value to customers by providing reliable and trusted banking services.

“The allocation of RM20 million towards the National Scam Response Centre and the launch of the National Fraud Portal is a continued initiative to mitigate scams further. Collective efforts by the banking industry and close collaboration with Bank Negara Malaysia and the enforcement agencies have contributed to blocking suspicious transactions, and we remain focused on ensuring the safety of the public transacting online,“ said Khairussaleh, who is also the Association of Banks in Malaysia chairman.

He said the RM100 million matching funds provided to encourage new Islamic financing innovation based on Islamic values will further enhance the Islamic finance sector.

“The prospects of growth are immense, and Maybank will continue to offer responsible and effective financing solutions for individuals and businesses, particularly SMEs, via our values-based financial solutions,” he added.