CIMB buys RBS’ Asian units

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Nazir Razak, CEO of CIMB, expands the bank's foothold in Asia

Malaysia’s second largest bank, CIMB, said on April 2 that has acquired a part of the Asian units of struggling Royal Bank of Scotland (RBS) to expand its presence in Asia.

The deal, worth $279 million, includes RBS’ equity capital markets, mergers and acquisition, and cash equity businesses in Indonesia, Malaysia, Singapore, Australia, China, Hong Kong, India, Taiwan, and Thailand. The transaction will be completed in the fourth quarter of 2012. CIMB also expects up to 400 staff from RBS to join its business.

CIMB said the deal would make the bank the largest investment banking franchise based in the Asia-Pacific region, excluding Japan. The announcement came shortly after Singapore’s DBS group said it will buy Indonesia’s Bank Danamon for $7.3 billion, indicating that the race is on for banks in East Asia to secure market share in the region.

Most of the RBS units will be absorbed into CIMB’s subsidiary, CIMB Securities International, which was last known as GK Goh Securities, based in Singapore, that the bank acquired back in 2005. With the deal, CIMB will have a new presence in Taiwan and Australia, as well as substantially enlarged operations in Hong Kong, India, and China.

For RBS, the sale to CIMB helps to ease global restructuring costs. The bank, 83 per cent-held by the UK government after being bailed out following the 2008 global financial crisis, is still making losses.

CIMB’s shares rose 2.2 per cent on the day after the deal was announced. Shares of RBS dropped 3.1 per cent.

Malaysia-based rating agency RAM Ratings said that CIMB Group’s ratings will be unaffected by the acquisition as the acquisition is not expected to materially affect CIMB Group’s leverage ratios, adding that CIMB Group’s AA1/Stable/P1 ratings are supported by the sound credit fundamentals of its subsidiaries.

 

 

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Reading Time: 1 minute

Nazir Razak, CEO of CIMB, expands the bank's foothold in Asia

Malaysia’s second largest bank, CIMB, said on April 2 that has acquired a part of the Asian units of struggling Royal Bank of Scotland (RBS) to expand its presence in Asia.

Reading Time: 1 minute

Nazir Razak, CEO of CIMB, expands the bank's foothold in Asia

Malaysia’s second largest bank, CIMB, said on April 2 that has acquired a part of the Asian units of struggling Royal Bank of Scotland (RBS) to expand its presence in Asia.

The deal, worth $279 million, includes RBS’ equity capital markets, mergers and acquisition, and cash equity businesses in Indonesia, Malaysia, Singapore, Australia, China, Hong Kong, India, Taiwan, and Thailand. The transaction will be completed in the fourth quarter of 2012. CIMB also expects up to 400 staff from RBS to join its business.

CIMB said the deal would make the bank the largest investment banking franchise based in the Asia-Pacific region, excluding Japan. The announcement came shortly after Singapore’s DBS group said it will buy Indonesia’s Bank Danamon for $7.3 billion, indicating that the race is on for banks in East Asia to secure market share in the region.

Most of the RBS units will be absorbed into CIMB’s subsidiary, CIMB Securities International, which was last known as GK Goh Securities, based in Singapore, that the bank acquired back in 2005. With the deal, CIMB will have a new presence in Taiwan and Australia, as well as substantially enlarged operations in Hong Kong, India, and China.

For RBS, the sale to CIMB helps to ease global restructuring costs. The bank, 83 per cent-held by the UK government after being bailed out following the 2008 global financial crisis, is still making losses.

CIMB’s shares rose 2.2 per cent on the day after the deal was announced. Shares of RBS dropped 3.1 per cent.

Malaysia-based rating agency RAM Ratings said that CIMB Group’s ratings will be unaffected by the acquisition as the acquisition is not expected to materially affect CIMB Group’s leverage ratios, adding that CIMB Group’s AA1/Stable/P1 ratings are supported by the sound credit fundamentals of its subsidiaries.

 

 

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