KUALA LUMPUR: CIMB Group Holdings Bhd
, Malaysia’s second- biggest bank, says it’s seeking merger and acquisition opportunities in neighbouring Indonesia despite a slump in investor confidence in South-East Asia’s biggest economy.
“For investors who see long-term potential in Indonesia, certainly it is a good time to come in,” CIMB chief executive officer (CEO) Novan Amirudin said in a Bloomberg TV interview in Kuala Lumpur.
The bank remains “fully committed” to the market.
CIMB’s confidence comes as Indonesia struggles to win back investors worried by President Prabowo Subianto’s populist and interventionist agenda, especially as the conflict in the Middle East drives up the cost of fuel subsidies.
Indonesia’s rupiah has slumped more than 8% this year to become Asia’s worst-performing currency.
The benchmark stock index has dropped 35%, though it gained yesterday.
The Malaysian lender, which operates CIMB Niaga in Indonesia, is looking at various assets that would complement its existing business, with wealth among those areas, Novan said.
“We would also look at maybe certain specialised areas that we currently do not have,” Novan said.
CIMB was among the shortlisted bidders for HSBC Holdings Plc’s retail and wealth assets in Indonesia, Bloomberg reported last month.
Singapore’s Oversea-Chinese Banking Corp substantially outbid its rivals to allow it to enter talks to finalise a deal.
Malaysia’s largest lender Malayan Banking Bhd (Maybank) also said it expects its Indonesian operations to be a big contributor to the group’s business in the medium to long-term.
Indonesia’s economy remains in growth mode, Maybank president and group CEO Datuk Seri Khairussaleh Ramli said in a separate interview.
Still, he acknowledged the complications on the ground, saying that the bank is focusing on trying to see how “it can still serve our customers there, but, you know, understanding the challenges that are being faced”.
Indonesia currently accounts for about 5% of Maybank’s profit, and any impact will not be major, he said. — Bloomberg
