2022 – Interview with Mohd Rashid Bin Mohamad, Group Managing Director & Group CEO at RHB Banking Group – Retail Banker International Asia Trailblazer Awards



In this Q&A interview, Mohd Rashid Bin Mohamad, Group Managing Director & Group CEO at RHB Banking Group, an MBA holder and member of the Malaysian Institute of Accountants (MIA), discusses his operational integration efforts during his stint at RHB’s Group Wholesale Banking division and transformation plans moving forward to prioritize customer experience (CX). The impact of Covid-19 and changing nature of financial services is also debated.

Question: Please briefly describe your career trajectory, aims, and future ambitions for RHB Bank Berhad?
Answer: I started my career in 1988 in Bank Negara Malaysia, where I had the opportunity to serve in the Examination/Supervision and Investment Operations & Financial Markets Departments and have since gained my experience serving regulatory bodies as well as various financial institutions locally and regionally.

I joined RHB in 2014 as Group Treasurer and led the consolidation of six different systems in IT into one operational entity under RHB’s Group Treasury and Global Markets division. This has resulted in us having a more flexible, efficient digital core that delivers better customer experiences (CX) to our internal and external customers. The effort has minimized our unit cost for products, enhanced risk management and front office capabilities, and provided scalability for quicker product rollouts and an enhanced ability to meet regulatory changes. From 2018 onwards when integration was first achieved, the division has contributed more than 30% in profit before tax (PBT) to the Group.

In July 2021, I was appointed as Managing Director of Group Wholesale Banking, before helming the Group as Group Managing Director / Group Chief Executive Officer on 1 April 2022. In leading the Group Wholesale Banking business, I drove the consolidation and spearheaded the integration and digitalization of Group Wholesale Banking Products and Solutions across the region.

Being entrusted to lead the Group has indeed been an honour. As GMD / GCEO, some of my key targets include:

  • To lead the Group into the next phase of our transformation journey, which is the implementation of our recently launched new corporate strategy, Together We Progress 24 (“TWP24”), as we continue to deliver value for all our key stakeholders and future-proof the bank during a time where uncertainty and volatility is the norm. This is also in line with our new purpose statement – Making Progress Happen for Everyone.
  • Focus on driving service excellence to improve overall CX and be more customer centric. Always putting the customer first – and at the center of everything we do – must be our guiding mantra.
  • I want to identify and seize on synergies as well as continue to streamline and improve our operations with the next stage of transformational projects that will deliver seamless, connected, and timely customer- centric solutions.
  • Deliver significant strategic and financial achievements, which include driving the consolidation further, as well as spearheading the integration and next stage of digitalization for the
  • Drive business growth and further enhance operational excellence both in Malaysia and regionally, in addition to providing maximum shareholder returns and meeting our financial targets.
  • Enhance focus and put more emphasis on the integration of environment, social and governance considerations within our business and decision- making process as well as drive responsible business growth, guided by RHB’s 5 Year (2022-2026) Sustainability Strategy.

Q2. Describe your leadership style and key tips for any newcomers to your role?
A2. I believe that in everything we do, there is a choice and the kind of attitude we choose to adopt is crucial. For me, having the right positive attitude means half the battle is won – the rest is a good vision, effective execution of the strategy and perseverance.

In terms of tips in order to do great things, and make a difference, we have to continuously learn and update ourselves – that goes for employees too. It is important to be proactive and get out of our comfort zones, while assessing any situation objectively. Be aware of the competition and see what is it that needs to be done to stay ahead of the curve. That is my philosophy in a nutshell.

Q3. How has your role & the financial services (FS) sector changed during your career?
A3. Today, leaders within FS are accountable to an increasing number of stakeholders – from employees to board members, regulators, shareholders, financial and environmental auditors, and so on. This isn’t a bad thing, but it is a change.

I have had the opportunity to serve in the financial services industry as well as industry regulators for over 20 years now, long enough to see the rapid growth of technology and its rising importance.

The Covid-19 pandemic has only accelerated this further where branches and many other physical contact businesses had to temporarily close or restrict hours, physical client meetings were curtailed and so forth. To stay competitive in this new tech-centric business and economic environment requires banks to recognize and rethink the importance of technology as a critical component of the business.

It doesn’t negate the need for people skills and other talents as well as the need for everyone within the organization to possess high learning agility. But tech is important in delivering effective CX, supported by well-trained customer facing team that has the capability of delivering seamless service experience -on 24x7 self service capabilities.

Q4. Talking of Covid-19, how has the pandemic impacted you, your business, and its prospects?
A4. The pandemic has had a profound impact on lives and livelihoods globally. However, it is not all despair and despondence. It has forced us as individuals as well as organizations to re-examine ourselves, revisit our priorities and re-evaluate what matters most in our lives, and to our stakeholders.

Resilience and the ability to adapt to change as we grappled with the fluid and unprecedented Covid-19 environment became the order of the day. For RHB, the pandemic has taught us valuable lessons and, most importantly, we have used these lessons to adapt to the circumstances – strengthening our foundation, enhancing our tech capabilities, and accelerating efforts in areas that matter most to our customers.

The well-being of customers, employees, and the communities we serve remained our top priority during 2021, and this will continue to be the case as we move forward. With agility and the willingness to realign and reprioritize our strategies, we have emerged fundamentally stronger. RHB is now well set to take advantage of the rapid changes in customer demand and behavior, as well as the expected economic recovery in the year ahead.

In terms of key financial targets, we have improved our Cost-to-Income Ratio from 49.9% in 2017 to 45.2% in 2021 as digitalization advances and we are already close to our next target of <45%, which we expect to beat. However, largely due to the pandemic, in FY2021 we attained a Return on Equity (RoE) of 9.6% against our 2022 target of 11.5%. Nevertheless, we are confident that this metric will improve over time in-line with the more sustained economic recovery that is expected to take place in 2022.

Q5. What non-Covid challenges does your company face?
A5. Better acceptance of online transactions and virtual engagement has propelled the automation and digitalization agenda to meet enhanced customer and business demands. This changing environment challenges the current norm and work culture, and the Group must be ready and agile to respond to the change management risk in order to remain relevant and resilient.

The pandemic and digital transformation have also challenged the traditional workforce model and talent retention programme, as work from home (WFH) imperatives arise, coupled with the competition from new digital banks and fintech companies, this trend has resulted in elevated human capital risk.

RHB recognises the challenges arising from talent shortages, as well as the risks in managing dispersed workforces, including remote employees. Therefore, we have put in place strategies for employee reskilling to prepare for the ‘Workforce of the Future’, and we are continuously reviewing and tweaking our talent management and retention programs.

The focus on operational resilience has also highlighted the importance of third-party management and supply chain risks within the Group’s operations and processes. This also necessitates the enhancement of our Third-Party Risk Management Framework to ensure effective oversight and control of its third parties in the changing landscape and to meet increasing regulatory expectations.

Q6. How has technology impacted your sector & company and how are you responding?
A6. RHB’s Digital Transformation Program began in 2017 with a vision of being a digital banking leader in the region. Our key pillars and aims are:

  • Customer journey re-imagination: to prioritize CX and seamless integrated services on multiple
  • Advanced analytics: to drive data-driven insights and personalization.
  • Ecosystem partnerships: to ensure we are accessible in multiple online communities, taking advantage of the trend towards ‘Open Banking’ and API (application programming interface) usage to enable simpler data exchange.

To transform into a leader within digital banking CX is crucial. Our operating model is built on the premise of agile values and productivity. We have delivered innovative, first-in-market products in Malaysia at speed and scale, such as:

  • Small to medium-sized enterprise (SME) electronic e-solution to cater for their needs.
  • SME online
  • RHB Rewards Motion Code credit card, which comes with a dynamic card verification value (CVV) or code, which establishes the owner’s identity and minimizes the risk of fraud. This is a first in Malaysia and indeed Southeast Asia (SEA).

As we move forward, we have refined our purpose statement and aim to be a leader in embedded finance through our ecosystem APIs. Our aim is to achieve:

  • 15% revenue from ecosystem partnerships (embedded finance on ecosystems).
  • Digital transactions to exceed 95% of total customer
  • 50% of customer acquisition to be done
  • Top three position in Malaysia’s DuitNow transactions by The mobile funds transfer service provides for e-payments, scans and so on.
  • Analytics-driven upticks in sales should contribute 10% of profits before tax (PBT).

To support our vision of API-driven financial services and be future-ready, we will shortly be migrating to a modern application architecture, allowing RHB to abstract codes at a higher level for better platform interoperability.

The bank is embracing the latest leading-edge technologies based on cloud, microservices and modern development practises, such as the agile and DevOps approach to fast innovation.

Q7. Please provide an overview of your bank’s results, activities, and future growth plans?
A7. RHB Banking Group has 14,000+ employees and extends beyond its Malaysian headquarters into eight other countries in the Association of Southeast Asian Nations (ASEAN) region. It has:

  • Total assets = RM289,541 million (FY2021)
  • Total income = RM7,789 million (FY2021)
  • Net profit = 2,618 million (FY2021)
  • Cost-to-income ratio = 2% (FY2021).

In financial year (FY) 2021, a large portion of revenue came from Group Community Banking, which spans retail and SME banking, and was the top contributor, earning 45% of the Group’s total income. This was followed by Wholesale Banking with 43%. Group International Business and Insurance respectively contributed 9% and 3%.

Regarding growth, there are three key segments we are targeting and investing in:

  1. Mass affluent & wealth management (WM): where revenue pool growth potential is the fastest and where our increasingly data-centric operations can deliver
  2. SME segment: where we intend to not only grow loans, but also provide a complete financial services
  3. Large- and Mid-Cap companies: we aim to increase penetration and share of wallet in this valuable business area.

Under our new corporate strategy, TWP24, these three key segments are driven by one key factor, which is driving service excellence. This sets the tone and establishes the direction towards achieving our aspirations of becoming the best service bank in the country.