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Maybank unlikely to buy Bank of Ayudhya stake

Publication Date : 28-09-2012

 

Malayan Banking Bhd (Maybank), the biggest bank in Malaysia by asset size, is unlikely to purchase the 25.3 per cent stake in Thailand's fifth largest bank, the Bank of Ayudhya pcl, if it were up for sale.

Analysts said that Maybank would be “better off” with an outright purchase of an entire bank.

“We gather that the 25.3 per cent stake currently owned by General Electric Co (GE) may not allow Maybank to assume absolute control of the Thai bank,” said Cheah King Yoong, banking analyst at Alliance Research.

It was reported on Wednesday that GE had sold a 7.6 per cent stake in Bank of Ayudhya and may consider selling the rest of its stake, which amounts to 25.3 per cent, to a strategic investor.

The 7.6 per cent stake was sold to institutional investors.

Earlier, Maybank together with the New Zealand Banking Group were reported to be among banks that were approached by GE after it wanted to review its 32.9 per cent stake in Bank of Ayudhya, prompting speculation Maybank may be interested in the Thai bank.

A Maybank spokesman declined to comment when asked whether it would be interested in acquiring the 25.3 per cent stake if it were up for sale.

“Maybank like its banking peers is also conserving capital in order to meet the new capital requirements under Basel III which will be implemented early next year.

“Hence, we do not foresee it utilising a significant portion of its capital to acquire a non-majority stake in Bank of Ayudhya,” said Cheah.

GE's 25.3 per cent stake in the bank is worth some US$1.65 billion.

Still, other analysts pointed out that Maybank does hold minority stakes of 20 per cent each in banks in Vietnam and Pakistan.

In 2008, it purchased a 15 per cent stake in Pakistan's MCB Bank Ltd from Nishat Group for 2.17 billion ringgit ($707.88 million) with an option to increase that stake to 20 per cent after a year. It also bought in the same year a 15 per cent stake in Vietnam's An Binh Commercial Joint Stock Bank for 430 million ringgit ($140.27 million) and later increased the stake to 20 per cent.

Meanwhile, Maybank has also reiterated its interest for a stronger foothold in the Thai banking market. Currently, it has a presence in Thailand via Maybank Kim Eng Securities (Thailand).

Its president and chief executive officer Abdul Wahid Omar said recently that the bank was waiting for “right timing and price”.

“We remain interested in Thailand. We are always looking for an opportunity, although we are not actively looking for it,” he was quoted as saying.

Maybank has said it intends to have a complete banking presence in Asean by 2015, in line with its target to become a regional financial player.

 

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