Response to The Star article entitled "What led to the collapse of Ambank-RHB deal"No Ruj : 27 Aug 2017 Embargo : Untuk Siaran Segera
This is with reference to the article entitled " What led to the collapse of Ambank - RHB deal" published in The Star on 26 August 2017. The article was inaccurate and could cause confusion among the players of the banking industry. In the reporting of such developments, adopting a fair and balance view should be the norm of journalists. Any insinuation or allegation made on certain parties should be accompanied by the parties' comments and feedback. It is expected that journalists should be fair, responsible and professional in their research and comments.
Bank Negara Malaysia would like to reiterate that mergers and acquisitions in the banking industry are driven by the market which in turn, is based largely on commercial and business considerations. The Central Bank does not and will not interfere with the negotiations between any of the parties involved. BNM plays the role of an enabler in facilitating the merger process.
The Central Bank gives the approval for the parties concerned to discuss and negotiate within a stipulated time frame. During this period, the parties will conduct a comprehensive assessment on the merger after weighing in various considerations. These include assessment of potential synergies as well as risks arising from their respective business models, operations and systems and after taking into account extensive analysis of both financial and non-financial information. It is also the fiduciary duty of the Board of Directors of the respective entities to ensure that the merger would ultimately take into account the best interest of stakeholders, in particular that of the depositors and shareholders.
In conclusion, mergers in the banking sector are mainly driven by the business considerations of banking institutions themselves. It is therefore grossly inaccurate and indeed mischievous of the article to conclude that "the deal is likely to have failed because the central bank was the only driver pushing the deal to go through ".
Bank Negara Malaysia
27 August 2017
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