Saturday December 29, 2007

 

Maybank open to Islamic M&As

Group plans to expand Maybank Islamic geographically

By CHAN CHING THUT

KUALA LUMPUR: Malayan Banking Bhd (Maybank) will consider strategic alliances or mergers and acquisitions that will create value for its Islamic banking business. 

President and chief executive officer Datuk Amirsham A. Aziz said the group planned to expand Maybank Islamic Bhd, its Islamic banking subsidiary, geographically in the short to medium term. 

“We are open to any ideas of a strategic alliance (although) at the moment, there is no such discussion. 

 

Datuk Amirsham A. Aziz
“We will look at institutions or parties which have wider distribution networks beyond Malaysia and with credible and proven track record, in terms of growth in Islamic banking,” he told a media briefing yesterday. 

Under Bank Negara regulations, Islamic banks can sell up to 49% of their equity to foreign investors. 

Maybank Islamic will kick off operations on Jan 1. Maybank's current head of Islamic banking, Ibrahim Hassan, will lead the subsidiary as acting CEO. 

Amirsham expects Islamic financing and deposits to grow by about 15% in the current financial year ending June. 

“Portfolio growth is anticipated to be at least RM2.5bil, with Islamic term loans for businesses contributing 40%, and hire-purchase and Islamic mortgage contributing about 27%,'' he said. 

The establishment of Maybank Islamic reaffirmed the group's focus on three key strategic businesses: international currency business unit (ICBU), Islamic investment banking and Islamic wealth management. 

Amirsham said in addition to the bank's stronghold in the domestic Islamic business, it wanted to capitalise on offshore Islamic business. 

“The ICBU will enable us to offer a wider range of Islamic banking products at more competitive prices. Our top priority is to support Malaysian companies which intend to tap the international market for their fund raising, particularly via Islamic instruments,” he added. 

Maybank Islamic would also concentrate on Islamic wealth management locally and targeted overseas markets, Amirsham said. 

“Globally, syariah-compliant financial products have attracted more than US$250bil, with an annual growth of 23.5% per annum over the last five years,'' he said. “Maybank is looking beyond Malaysia's shores in view of the tremendous excess liquidity generated, given the surge in oil prices.” 

Maybank is the country's Islamic banking leader with assets of over RM23bil at end-September. 

It currently has 12 full-fledged Islamic banking branches, in addition to 376 branches and 20 private banking centres locally offering Islamic banking products and services.