PETALING JAYA: PM Securities Sdn Bhd’s failed bid to convert its universal broker (UB) status to a standalone investment bank (IB) was due to the firm’s failure to comply with the pre-requisite conditions outlined under the stockbroking consolidation plan introduced almost four years ago.
“They had been asking for extensions in the past, but the time had lapsed and the window is closed,’’ an industry source said.
PM Securities said on Monday that it had paid the initial deposit of RM10mil on Jan 5, 2006 to apply for the IB licence.
The deposit was refunded, together with accrued interest, after Bank Negara informed the company in a letter dated Dec 23 that its application was rejected by the Minister of Finance.
Previously, to qualify as an IB, a UB like PM Securities must first acquire a merchant bank and meet the minimum capital requirement, which earlier reports put at RM500mil.
Bank Negara had cancelled all discount house licences by the end of 2006 and there are currently no merchant banks up for sale.
The source said the only route now for stockbrokers to become an IB is to acquire an existing IB status player.
In a short statement posted on Bursa Malaysia by parent company Pan Malaysia Capital Bhd on Monday, the company said that the directors of PM Securities would discuss the matter “at its next board meeting’’.
In total, there are 15 IBs in the country.
Hong Leong Investment Bank won the licence last year after it acquired Southern Investment Bank from CIMB Bank.
Other bank-backed IBs are Affin Investment Bank Bhd, Alliance Investment Bank Bhd, AmInvestment Bank Bhd, CIMB Investment Bank Bhd, MIMB Investment Bank Bhd, Public Invetsment Bank Bhd and RHB Investment Bank Bhd.
PM Securities’ stockbroking peers that are now classified as standalone IBs are ECM Libra Investment Bank Bhd, Hwang-DBS Investment Bank Bhd, KAF Investment Bank Bhd, Kenanga Investment Bank Bhd, MIDF Investment Bank Bhd and OSK Investment Bank Bhd.
Then there are six other stockbrokers that fall under the 1+1 stockbroking firm category.
These are TA Securities Holdings Bhd, A.A. Anthony Securities Sdn Bhd, Inter-Pacific Securities Sdn Bhd, JF Apex Securities Bhd, M&A Securities Sdn Bhd and Mercury Securities Sdn Bhd.
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