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Bank Negara okays MBSB's merger talks with AFB

KUALA LUMPUR (Dec 21): Bank Negara Malaysia (BNM) has no objection in principle to Malaysia Building Society Bhd's (MBSB) commencing talks with Asian Finance Bank (AFB) on a potential merger and acquisition (M&A) deal.

MBSB said it plans to negotiate with the existing shareholders of AFB, namely Qatar Islamic Bank, RUSB Investment Bank Inc, Tadhamon International Islamic Bank and Financial Assets Bahrain WLL.

"BNM requires that the negotiations be completed within six months from the date of the letter," the non-bank lender said in a bourse filing today.

The Edge weekly recently reported that MBSB and AFB were awaiting BNM's approval to start official negotiations after Malaysian Industrial Development Finance Bhd's (MIDF) plan to buy over AFB fell through earlier this year.

Quoting sources, the weekly reported that both parties were in exploratory M&A talks and that they had written in to seek the central bank's approval in early November.

MBSB president and chief executive officer Datuk Ahmad Zaini Othman, who was asked on the matter during a company event on Dec 5, said he can't comment "until shareholders give [them] the green light".

"At the end of the day, in any corporate exercise, it's all about the pricing. If the pricing is right, then I suppose it'll be okay," he went on to say. — theedgemarkets.com

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