Sarawak’s plan to purchase LTAT shares in Affin Bank put on hold

 

Sarawak Premier Abang Johari Openg at the MoU signing ceremony with LTAT at Menara Affin in Kuala Lumpur today.

KUALA LUMPUR: 

The Sarawak government has signed a memorandum of understanding with the Armed Forces Fund Board (LTAT), after its agreement to purchase LTAT’s shares in Affin Bank Bhd had to be put on hold.

While the media were invited yesterday to a signing ceremony between the Sarawak government and LTAT for an 

acquisition of shares

, the event turned out to be an MoU signing ceremony to 

explore potential cooperation, collaboration and sharing of information

.

The Edge Malaysia reported that the planned agreement between Sarawak and LTAT – which is Affin Bank’s largest shareholder – would have formalised the state’s plan to increase its stake in the lender to around 30% from the 4.8% it currently holds.

With regard to the acquisition of additional shares in Affin Bank by the Sarawak government from LTAT, both parties will proceed with a sale and purchase agreement (SPA) upon securing the necessary regulatory approvals,

 Sarawak Premier Abang Johari Openg said during the MoU signing ceremony.

However, he did not provide details about the approvals needed.

In May, Abang Johari said the Sarawak government was awaiting approval from Bank Negara Malaysia for its bid for an increased stake in Affin Bank.

The Edge said the SPA signing ceremony had been postponed as Sarawak wanted to 

clarify some conditions

 that BNM had attached to the deal.

It also reported that Sarawak is to acquire part of LTAT’s stake in Affin Bank and Boustead Holdings Bhd’s entire 20% stake.

Boustead, which is wholly owned by LTAT, is currently Affin Bank’s third-largest shareholder. The Bank of East Asia Ltd is Affin Bank’s second largest shareholder with over 23%.

Touching on the MoU, Abang Johari said Affin Bank would gain the opportunity to expand its customer base into the 

untapped potentials

 of Sarawak’s retail market and explore opportunities to provide local small and medium businesses (SMEs) with affordable loans.

Opportunities to work with Affin Bank are wide, including promoting cashless payments and SMEs to adopt digital banking in Sarawak,

 he said.

We believe this will have an added impact on Sarawak’s development as it boosts the economy further through the development of SMEs and entrepreneurship programmes in the state. - FMT