KUALA LUMPUR: ECM Libra Financial Group Bhd will find it tough to see a repeat performance of its financial year ended Jan 31, 2008 (FY08) in the current fiscal year (FY09) due to various factors, including global economic uncertainties, its chief executive officer Datuk Seri Kalimullah Masheerul Hassan said.

“There will still be opportunities for us but we think it will be a very tough year for us,” he told reporters after the company’s AGM here yesterday.

Kalimullah, however, said the company would try its best to grow and expected a positive performance in FY09. “Whether it will be as good as last year — it will be very tough to achieve.”

ECM Libra’s net profit rose more than fourfold to RM84.39 million in FY08 from RM20.16 million previously.
Its managing director Lim Kian Onn said the lack of activities in the capital markets due to the current economic environment and the rise in the number of competitors were among the biggest challenges facing the company.

Elaborating, Kalimullah said the shortage of talent was also affecting the whole industry as many Malaysian investment bankers preferred to work in places like Singapore, Hong Kong and the United States.

On the company’s strategy going forward, Lim said it would focus on building a stronger team and talent within the company and increasing its asset size and loan base over the next few years.

Among other things, he said ECM Libra planned to grow its asset base to about RM4 billion to RM5 billion, which would allow the company to undertake bigger transactions.

“It is difficult to build it up in a short space of time but we hope to be able to reach that target in two to three years’ time,” he said.

Lim reckoned that the Malaysian market was too small for investment banks to focus on particular niche areas and they had to become generalists involved in various industries.

“We cannot compete in space where we are required to put a lot of money in. If someone comes and say ‘we want to do a corporate finance transaction and want you to lend us RM2 billion at this rate.’ We cannot do that because our balance sheet is far too small. So we have to go for medium-sized transactions,” he said.

According to Lim, ECM Libra had lost out on many transactions, especially those that involved hundreds of million to billions of ringgit, since it could only handle transactions worth up to RM125 million.

“We need to differentiate ourselves by offering specialised investment advisory services and have the confidence of selling ourselves by being better. That is also not so easy. It requires a strong team and good people,” he added.