KUALA LUMPUR, July 10 — Malaysia’s CIMB Group Holdings Bhd. plans to acquire RHB Capital Bhd. and Malaysia Building Society Bhd. to create the country’s biggest banking group by assets, according to people familiar with the matter.
The lenders, which have a combined market value of about US$28 billion (RM88 billion), submitted an application to the central bank to begin talks, according to the people, who asked not to be identified as the information is private. The idea is still preliminary and a deal structure hasn’t been decided, they said.
A combination of the three banks would create a group with total assets of RM597.3 billion at the end of last year, surpassing Malayan Banking Bhd.’s RM560.4 billion, according to data compiled by Bloomberg. The move comes three years after CIMB scrapped a plan to acquire RHB Capital.
Employees Provident Fund, the country’s biggest pension manager, owns a 14.5 per cent stake in CIMB and a 41.3 per cent interest in RHB Capital, according to data compiled by Bloomberg. The fund owns 65 per cent of Malaysia Building Society, the data show.
The Edge Financial Daily reported the merger plans earlier, citing unidentified people. Effendy Shahul Hamid, chief marketing and communications officer at CIMB, declined to comment. Malaysia Building and RHB Capital didn’t immediately respond to e-mails seeking comment.
Malaysian lenders are required to obtain the central bank’s approval before any merger negotiations can proceed. CIMB, RHB Capital and Malaysia Building requested their shares be suspended from trading today, pending announcements.
CIMB and Maybank, Malaysia’s two biggest lenders, scrapped separate talks to acquire RHB Capital in June 2011 over concerns about price, people familiar with the matter said at the time. — Bloomberg
