Maybank eager for more IPOs after Kim Eng share buy

The purchase provides Maybank platform to expand services that includes IPOs within Southeast Asia.

Malayan Banking Bhd (Maybank) is aiming to capture more initial stock sales and corporate fund-raising deals in South-East Asia this year after spending S$1.79bil to buy Singapore's Kim Eng Holdings Ltd.

The purchase gives Maybank investment-banking licences and a platform to expand services outside Malaysia, according to chief executive officer Datuk Seri Abdul Wahid Omar. Maybank's overseas ventures were previously limited to retail and commercial banking in markets such as Singapore and Indonesia.

“There are a number of Malaysia IPOs that we have missed in the past simply because of the lack of distribution capability within the region,” Wahid said in an interview on Wednesday. “There are also customers in Singapore and Indonesia that we have been nurturing and when it came to the time when they want to be listed or to access the capital markets, we were not able to fulfill their requirements.”

The acquisition will also help Maybank close the gap in investment banking services with local rival CIMB Group Holdings Bhd after buying stakes in Indonesia, Vietnam and Pakistan lenders in the past three years. In 2005, CIMB acquired the stock-broking business of Singapore's GK Goh Holdings Ltd, giving it access to regional markets and extending its network beyond Malaysia's 28 million population.

CIMB, which helped arrange Petronas Chemicals Group Bhd's share sale last year, has a 32.8% market share in underwriting Malaysian equity and rights offerings in 2010, according to data compiled byBloomberg. Maybank had 10.3% of the market.

Maybank relied on Malaysia for 82% of its pre-tax income in the year ended June, according to data compiled by Bloomberg. The Kuala Lumpur-based bank had said it was aiming to cut the ratio to 60% by 2015.

View the full story in The Malaysian Star.