Al Rajhi Bank is terminating the merger negotiations between its wholly-owned subsidiary, Al Rajhi Banking and Investment Corp (M) Bhd (Al Rajhi Malaysia) and Malaysian Industrial Development Finance Bhd (MIDF).
Al Rajhi bank said in a filing on Saudi Stock Exchange, Tadawul, it is no longer pursuing the merger as no agreement was reached between the two parties.
In January last year, Al Rajhi Bank said it was in talks with MIDF for a possibility of merging one of its wholly-owned companies, Al Rajhi Malaysia.
The negotiation also received Bank Negara Malaysia’s (BNM) nod but failed to meet the several deadlines to conclude the deal.
Consolidation in Malaysia’s banking sector, which are typically executed via merger and acquisition deals, have been hit-and-miss.
The wholly owned subsidiary of Permodalan Nasional Bhd largely focuses on wholesale and investment banking and Islamic capital-raising, besides small and medium enterprisefinancing.
Meanwhile, Al Rajhi Malaysia is a retail bank. Based on the information on its website, the bank started with its first branch on Jalan Ampang, Kuala Lumpur, in 2006 and now has 17 branches nationwide. Al Rajhi Malaysia’s parent company is the Saudi Arabia-based Al Rajhi Banking & Investment Corp.
By : SHAHEERA AZNAM SHAH / THE MALAYSIAN RESERVE / pic by BLOOMBERG