MBSB gets Govt’s nod for merger with Asian Finance Bank - Business News | The Star Online


MBSB gets Govt’s nod for merger with Asian Finance Bank

KUALA LUMPUR: Malaysia Building Society Bhd (MBSB) is poised to turn into a full-fledged Islamic bank, having received the Finance Minister’s green light to acquire the entire interest in Qatar Islamic Bank’s subsidiary Asian Finance Bank Bhd.

It appears to be third time lucky, following the aborted proposed three-way merger with CIMB Group Holdings Bhd and RHB Capital Bhd , and last year’s scrapped proposed merger with  Bank Muamalat Malaysia Bhd.

The non-bank lender, which is 65.56% owned by the Employees Provident Fund, said it was notified by Bank Negara Malaysia on Friday that the Finance Minister had granted approval for the proposed acquisition pursuant to the Islamic Financial Services Act 2013.

“Further details will be announced upon the finalisation and execution of the definitive agreement,” it said in a flling with Bursa Malaysia.

MBSB disclosed in December last year that it planned to negotiate with the existing shareholders of Asian Finance Bank Bhd, namely Qatar Islamic Bank (66.67% stake), RUSB Investment Bank Inc (16.67%), Tadhamon International Islamic Bank (10%) and Financial Assets Bahrain WLL (6.67%), for a proposed merger of MBSB and Asian Finance Bank.

Since then, its share price has climbed 44.5% to close at RM1.27 on Friday (down 1 sen from the previous day, with 1.59 million shares traded).

The central bank gave the parties six months, up to June 21, to conclude talks. MBSB submitted an application to Bank Negara within the stipulated timeframe (on June 19) to seek the approval for the proposed merger.

MBSB posted a group net profit of RM201.41mil for the year ended Dec 31, 2016, down 22% from the preceding year. Asian Finance Bank, meanwhile, made a group net profit of RM3.65mil for the same period versus RM0.53mil in 2015.