PETALING JAYA: RHB Bank Bhd’s 99% indirect subsidiary in Indonesia PT RHB Sekuritas Indonesia has proposed to exit from the asset management business and focus on the stock broking and investment banking business in Indonesia instead.
The bank said that this exercise was part of its strategic plan to reprioritise its overseas businesses to focus on niche markets, leveraging on the key strengths of its investment banking team to meet customers’ needs.
“RHB Bank has decided to exit from the asset management business and to focus on our stock broking and investment banking business in Indonesia,” the bank said in its Bursa Malaysia announcement.
“The asset management industry in Indonesia is dominated by the Top-10 companies which collectively control approximately 63% market share, and PT RHB Asset Management Indonesia (RHBAMI) is currently ranked 21st,” it noted.
It will entail the disposal by RHB Sekuritas of its entire 98.62% equity interest and 1.00% equity interest in RHBAMI to AllianzGI and Allianz Life Indonesia respectively, the bank said.
“Our team in Indonesia will ensure the smooth transition of our clients as well as existing staff of RHBAMI to the enlarged group,” said group managing director and Group CEO Datuk Khairussaleh Ramli in a statement.
“Indonesia remains a key market driver and an important part of RHB Banking Group’s regional footprint, where RHB has been in operations for over 12 years. Therefore, we will focus on enhancing and growing our stockbroking and investment banking business in Indonesia through PT RHB Sekuritas Indonesia by investing in core capabilities to drive our business growth,” he added.
RHBAMI is a 99.62% subsidiary of RHB Sekuritas and the remaining 0.38% equity interest is held by Daniel Budiman, it said.
“As at Dec 31, 2020, the net assets of RHBAMI was approximately 31.60 billion rupiah or RM9.20mil (based on latest exchange rates),” it said.
RHBAMI’s assets under management stood at US$480mil (RM2.03bil) as of December 2020, RHB said in its statement.
The proposed transaction is expected to be completed in the fourth quarter of this year and is subject to conditions precedent of the conditional share purchase agreement, including the approval by the Indonesian Financial Services Authority.
“Upon completion of this proposed disposal, RHBAMI will cease to be a subsidiary of RHB Sekuritas,” RHB said.
Further information will be communicated to RHBAMI customers in due course and in the meantime, customers may contact their respective account managers for more information, RHB said.
RHB said that this disposal will not have any effect on its issued and paid-up share capital and substantial shareholders’ shareholdings of RHB Bank.
It is also not expected to have any material effect on the net assets and earnings of RHB Bank for the financial year ending Dec 31, 2021.