Japan brokerage gets BNM nod to buy stake in Affin Hwang

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KUALA LUMPUR: Bank Negara (BNM) has approved the proposal of Japan’s Daiwa Securities Group to acquire a minority stake in the investment banking arm of Affin Holdings.

The approval from Bank Negara Malaysia marks another step forward for the Japanese brokerage’s proposed stake purchase in Affin Hwang Investment Bank, the Nikkei Asian Review (NAR) reported.

The deal is still pending shareholders’ agreement and approval from other authorities including that of Malaysia’s capital market regulator, the Securities Commission.

“Affin and Daiwa Securities will review and deliberate on the terms and conditions of BNM’s approval towards the finalisation of the proposal,” the company said in a filing to the Malaysian stock exchange.

Affin didn’t disclose financial details, said the NAR report.

On May 7, NAR had reported that Daiwa Securities planned to buy about 20 per cent stake in Affin Hwang in a deal worth USD82.8 million.

Daiwa was also considering alliances with brokerages in Thailand and in Indonesia to strengthen its services across Asia, the report said.

Affin Holdings, the financial services arm of Malaysia’s Armed Forces Fund, owns one of the smallest banks in Malaysia with assets of about RM59.8 billion (USD14.4 billion) at the end of December.

Hong Kong-based Bank of East Asia is also a major shareholder, with 24 per cent stake in Affin.

According to NAR, talks between Affin and Daiwa for the proposed acquisition began officially in April 2015 following a business alliance between the two companies that lasted more than two years.