EPF mulls buying rest of RHB

The Employees Provident Fund (EPF) is considering buying the 59 per cent of RHB Capital Berhad that it does not already own and has hired Goldman Sachs to advise it on its options, people familiar with the matter said.

EPF wants to privatise RHB to merge it with property financing firm Malaysian Building Society Bhd (MBSB) and later relist the merged group as part of a restructuring, the people said.

The fund also owns nearly 60 per cent of MBSB. According to a Reuters report, the move is another sign of consolidation in Malaysia's financial sector as it prepares for higher capital requirements under Basel III rules, which were drawn up to avoid a repeat of the financial crisis that followed the collapse of Lehman Brothers in 2008.

RHB, Malaysia's fourth-largest bank, has a market capitalisation of $6.8 billion (RM19.84 billion). Abu Dhabi's Aabar Investment is RHB's second-largest shareholder, with a 22 per cent stake, followed by OSK Holdings with 9.8 per cent.

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Bank notes to sport new look from mid 2012

The Ringgit will be sporting a new and exciting look, with the RM20 note making a comeback.

Maybank, CIMB reported to have dropped RHB plans

Malaysia’s two largest banks, Malayan Banking Bhd and CIMB Group, have dropped their plans to take over RHB Capital, Singapore’s Straits Times reported today, citing executives close to the situation.

“Pricing wise, the takeover doesn’t make much sense now,” the Straits Times quoted a senior financial executive, who spoke on condition of anonymity. “There is going to be a cooling down and the two banks may revisit the prospect of a merger with RHB at some other time.”

The decision came after one of RHB’s shareholders, Abu Dhabi Commercial Bank, signed the sale agreement of its 25 per cent stake in RHB with Abu Dhabi-based investment fund Aabar Investments for RM10.80 a share.

Maybank to submit merger plan end-June

Wahid (left) and Megat Zaharuddin speaking to the media yesterday.


Malayan Banking Bhd (Maybank) expects to make a proposal on its proposed merger with RHB Capital Bhd (RHBCap) by the end of June, its president and chief executive officer Datuk Seri Abdul Wahid Omar said.

The country’s biggest lender has been in discussions with all major shareholders of RHBCap on its takeover bid.

Maybank and CIMB Group Holdings Bhd are making separate takeover bids for RHBCap, the country’s fifith largest banking group.

Maybank said to hire Nomura as adviser for RHB bid

Malaysia's biggest lender, Malayan Banking Berhad (Maybank), has hired Japanese investment bank Nomura to advise on its takeover bid for RHB Capital, which could create one of the largest banking groups in Southeast Asia, a source with direct knowledge of the deal said.

The appointment was expected after Nomura advised Maybank for its US$1.4 billion (RM4.26 billion) takeover bid for Singapore stock broker Kim Eng earlier this year.

Nomura and Maybank declined comment.

RM20 banknote making a comeback

After a 16-year hiatus, the RM20 banknote will be re-introduced by Bank Negara.

It is part of a new design of Malaysian banknotes and coins which will be issued for circulation early next year in an exercise that is undertaken periodically every 12 years.

“The re-introduction of the RM20 banknote in the new currency series is primarily to function as an intermediary denomination to bridge the value gap between RM10 and RM50 for greater convenience in making payments,” Bank Negara told The Star in a statement yesterday.

With the new RM20 banknote, the central bank expects a reduction in overall demand for RM10 and RM50 banknotes.

The old RM20 banknote was introduced during the second series in 1982 and was discontinued in 1995.

It featured Malaysian traditional ornamental designs and the Bank Negara headquarters on its reverse side.

GDP expands 4.6% in Q1

The Malaysian economy expanded 4.6% in the first quarter, just shy of the 4.8% expected by most economists, while inflation in April quickened to 3.2%.

Despite the slow start, Bank Negara is keeping its full-year forecast of 5% and 6% growth for 2011.

“We have already priced in this slower growth in our forecast,’’ governor Tan Sri Dr Zeti Akhtar Aziz told a media conference today.

She said the domestic economy is expected to remain on a steady growth path for the rest of the year, driven by the private sector and supported by the public sector.

“Policy is directed to provide a positive enabling environment and positive investment climate to sustain this growth,’’ she said.

But the job does not get any easier for policymakers, as they juggle the need to keep the economy chugging along and trying to put the lid on rising prices.

Earlier this month, Bank Negara raised its overnight policy rate (OPR) by 25 basis points to 3%.

Closure for EON Cap deal? Hong Leong taking over EON saga.

The board of EON Capital Bhd (EON Cap) has accepted the RM5.06bil takeover bid by Hong Leong Bank Bhd (HLB), capping a 16-month battle to create the country's fourth-largest bank by assets. It also proposed a surprise net interim dividend of RM312mil, or 45 sen per share, in addition to the offer price.

“The directors intend to manage this transaction in a manner that is fair and equitable to all parties concerned ... The additional interim dividend payment is in addition to the offer price of RM5.06bil and was secured after much negotiation with Hong Leong Bank ...,” said EON Cap chairman Gooi Hoe Soon in a statement.

The announcement came a day after the court ruled in favour of EON Cap and stopped EON Cap's largest shareholder Primus Pacific Partners Ltd's attempt to block the sale and a day before HLB's offer expires.

In a separate announcement, EON Cap said Primus had served the company's solicitors a notice of appeal, appealing the court decision. No date has been fixed for the appeal, which was largely expected by market observers.

Bank Negara in Beijing

Prime Minister Datuk Seri Najib Razak welcoming his Chinese counterpart, Wen Jiabao, with a firm handshake at the federal administrative capital in Putrajaya yesterday.



: Malaysia-China bilateral relations were raised to a higher level with the inking of several agreements and memorandums of understanding here yesterday.


The signing ceremony that marked another step towards greater cooperation and joint investments in higher education, energy, infrastructure and communications, among others, was witnessed by Prime Minister Datuk Seri Najib Razak and his Chinese counterpart, Wen Jiabao.

Wen arrived on Wednesday for a twoday visit, accompanied by a team of 118 delegates, including four ministers.

A milestone was the agreement on the setting up of a Bank Negara Malaysia representative office in Beijing. This would facilitate trade settlement in local currency.


Najib said Kuala Lumpur and Beijing felt the agreement to settle trade in local currency was a huge step forward in bilateral trade. Malaysia is China’s biggest trading partner in Southeast Asia.

Another agreement was signed between China’s Huadian Engineering and Malaysia’s Janakuasa Sdn Bhd on the construction of a coal-fired power plant. Janakuasa had previously been awarded the US$1.5 billion (RM4.48 billion) project in Vietnam, expected to be completed in 2015.

Ringgit hits new 13-year high of 2.99 vs USD

The ringgit hit a new 13-year high of 2.99 against the US dollar for the first time today, on strong overseas buying interest, a currency trader said.

At 11.40am, the ringgit was traded at 2.9945/9975 against the US dollar, its highest level since October 1997.

"There was a strong demand for the local currency from overseas banks as the ringgit is still undervalued and also on investors optimism over the stock market driven by the Economic Transformation Programme," the trader told Bernama.

He also said the ringgit is still undervalued when all Asean currencies had recovered from the 1997 currency crisis, with some, even above the pre-crisis level.

Zeti reappointed as Bank Negara governor

Bank Negara said in a statement its governor Tan Sri Dr Zeti Akhtar Aziz has been reappointed for a five-year term, effective May 1.

The 64-year-old Zeti has held the position since May 2000.

Malaysia to issue RM3b Sukuk 1Malaysia

The Finance Ministry has announced the issuance of Sukuk 1Malaysia 2010 amounting to RM3 billion on June 21 2010. This is an additional investment instrument for Malaysian citizens aged 21 years and above.

Bank Negara Malaysia has been appointed to issue the sukuk on behalf of the government.

The sukuk will be scripless and based on Shariah principles, the Finance Ministry said in a statement.

The RM3 billion sukuk, which has a three-year tenure, offers a return of 5 per cent per annum. Sukuk 1Malaysia 2010 has a resaleable feature which provides the flexibility for investors to sell and purchase the sukuk before the maturity date.