Malaysia's RHB, AMMB Expected to Call Off Merger Talks

By Yantoultra Ngui Features Dow Jones Newswires

KUALA LUMPUR, Malaysia--RHB Bank Bhd. (1066.KU) and AMMB Holdings Bhd. (1015.KU), Malaysia's fourth- and sixth-largest lenders by assets, respectively, are expected to call off talks for a proposed merger, people familiar with the matter said Tuesday.

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Both banks weren't able to agree on the terms during merger talks, the people said. The deal, if successful, would challenge the position of Public Bank Bhd. (1295.KU) as the country's third-largest lender.

Spokespeople for the banks declined to comment and said announcements would be made later in the day.

Some analysts had said that the proposed merger, first announced early June, wouldn't create much synergy as both banks have similar target markets.

If confirmed, this would mark RHB's second failed merger attempt in recent years. In January 2015, RHB attempted a three-way merger with the country's second-largest lender, CIMB Group Holdings Bhd. (1023.KU), and nonbank lender Malaysia Building Society Bhd. (1171.KU). That combination would have created Malaysia's biggest bank by assets, overtaking Malayan Banking Bhd. (1155.KU). Talks fell through, however, partly due to disagreements over how to value the shares of the three lenders, the banks said.

Shares of both banks were suspended Tuesday pending material announcement.

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Write to Yantoultra Ngui at yantoultra.ngui@wsj.com

(END) Dow Jones Newswires

August 22, 2017 07:55 ET (11:55 GMT)