Khazanah still studying TPP’s impact on its investments

Azman says Khazanah will decide later whether to sell its stake in Bank Muamalat Malaysia Bhd.

KUALA LUMPUR: Sovereign investment arm Khazanah Nasional Bhd is still studying the impact of the Trans-Pacific Partnership (TPP) on its investments, saying that it is still premature to make any statement.

“Our research institute is issuing a book called Why Trade Matters, where it is a reference book on how to analyse trade.

“It’s not for or against TPP but to give a better understanding about complex trade matters,” Khazanah managing director Tan Sri Azman Mokhtar told reporters on Thursday.

Updating on the merger talks between Khazanah’s 30% owned Bank Muamalat Malaysia Bhd and Malaysia Building Society Bhd (MBSB), he said Khazanah would decide later if it would sell its stake in the bank.

“We are not the major shareholders in Muamalat. Bank Negara Malaysia has given approval and talks are ongoing so the major shareholders are the ones that determine the outcome.

“Then only we will decide if the outcome is good for us or not,” he added.

Bank Negara gave its nod to MBSB and Bank Muamalat to begin merger talks, a move that could pave the way for the creation of the country’s biggest standalone Islamic bank.

Azman said the negotiations for the potential merger would be held between MBSB and conglomerate DRB-Hicom Bhd, which owns 70% of Bank Muamalat.

“We have seen some progress in Bank Muamalat, but really, our partners DRB-Hicom and MBSB, which is owned by the Employees Provident Fund, are taking the lead,” Azman said. 

“Khazanah will make a decision based on whatever they decide,” he said earlier.

Assuming the merger goes through, the combined asset size of the two lenders is estimated to be RM60bil.

The assets combined is higher than BIMB Holdings Bhd’s asset size of RM54bil as at end-March. BIMB is the holding company of Bank Islam Malaysia Bhd.

Both MBSB and DRB-Hicom said last week that the central bank required the merger negotiations to be finalised within three months from the date of the approval.

MBSB shares fell 1 sen to close at RM1.69 on Thursday while DRB-Hicom shares also shed 1 sen, ending at RM1.32.