KOTA KINABALU: Newly corporatised Agro Bank is set to play a bigger and more significant role in promoting development in the agriculture sector.

State director Noor Azman Ahmad said the bank, which changed its name from Bank Pertanian to mark its corporatisation on April 1, was expanding its operation towards becoming a well-known banking entity that was instrumental in the development of the agriculture-based industry in the country.

“Definitely we will play a bigger role. We are now on the right track and have a very good momentum. The condition is already there for us to be an important player and catalyst for developing the agriculture sector,” said Azman at a press conference held in connection with the state level official launch of the bank???s new name and logo.

He said to further improve its services in Sabah, Agro Bank, which currently had a total of 12 branches across the state, is in the process of opening new branches, specially in areas where there are currently no banking services available.

So far, one branch has been opened in Kuala Penyu with another expected to be opened and fully operational in Kinabatangan by August, said Noor Azman.

He added Agro Bank was also studying possibilities to open a branch in Pitas, another rural districts which currently have no banking services.

Apart from opening new branches, Agro Bank is also providing mini banking services such as the one currently available in Ranau to enable its clients in the area to do their banking without having to travel all the way to Kota Kinabalu.

“We have a lot of clients there. Most of them are vegetable farmers, some are breeders. We figure it would be troublesome for them to come down to the city every time they need to deal with us,” said Noor Azman.

“So, we provide sort of mobile banking for them. Two service counters are opened twice a month, one at the Fama office and another at the district???s Regional Farmers Association office.

“These service counters are opened every first and fourth week of the month, providing customer consultation service. Customers can also pay their bills or open new account,” he said.

Based on the encouraging response to the mobile banking services, Agro Bank is planning to open a branch in the district in near future.

In addition to providing more branches for its customers, Noor Azman said Agro Bank is also enhancing its services by further improving its existing products as well as introducing new products.

He said the very reason for the corporatisation of Agro Bank is to make the institution more competitive by enabling it to provide a wider range of products and services to cater for the whole segment of the agriculture industry.

He explained that the activities of the Bank formed under the Parliament Act as a wholly government-owned institution, was previously limited by the Bank Pertanian Malaysia Act 1969.

Through the corporatisation, though still fully-owned by the government, Agro Bank strives to be more efficient, productive and competitive in providing financial support for agriculture related activities, he said.

“There will be no changes in our role except to provide better services to meet the total needs of our customers,” he said.

“For instance, previously we were limited to national business but now we can also provide services for international business such as import and export of agriculture products.

In line with the state government???s Halatuju and the objective under the newly launched Sabah Development Corridor to make agriculture as among the main income earners for the state, he said Agro Bank will continue to support whatever programmes under the Agriculture Ministry.

He said financial loan of up to 80 per cent of the start-up cost will continue to be provided for agricultural activities with priority to be given to businesses based on products currently being promoted by the government, such as planting of jatropha and vanilla orchid.

“Our main criterium for loans for agriculture ventures is that there must be a secure market for the products to be developed,” he said.

“For products like jatropha, which is promoted and developed and marketed through government agencies, there should be no problem. The same with vanilla which is under the Rural Development Corporative,” he said.

Apart from planting activities, Agro Bank will also continue to provide loans for breeding activities including for aquaculture.

At the same time it would also support downstream activities such as processing of agriculture products, packaging, value-adding and so on.

On the state Agro Bank performance, he said Sabah has recorded the lowest rate of Non-Performance Loans (NPL) for two years in row.

As at March 31, Sabah???s NPL was at 0.89 per cent compared to the national average of 4.48 per cent, according to Noor Azman.

He said there are 261,305 active Agro Bank account holders in Sabah, representing more than 10 per cent of the total of two million account holders in the country.

The total deficit for Sabah as at end last month was RM251.2 million. Nationwide, Agro Bank has approved a total of RM15.3 billion loans with deposits and savings amounting to RM4.58 billion.