Small banks to become even more niche

THE creation of the country’s largest bank, should the merger between CIMB Group Holdings Bhd, RHB Capital Bhd (RHB Cap) and Malaysia Building Society Bhd (MBSB) take place, will create a two-tier banking system that could see small banks become even more niche than they are.

Such a disparity will become more punitive for the smaller banks and will lead to the creation of two grouping of banks: the top tier consisting of the merged entity, Malayan Banking Bhd (Maybank) and Public Bank Bhd, and their smaller brethren.