Abang Johari pointed out that the reported 20 per cent stake targeted by the Sarawak government was inaccurate. – Photo by Chimon Upon
KUCHING (Jan 17): Premier Datuk Patinggi Tan Sri Abang Johari Tun Openg remained tight-lipped when asked to confirm reports surrounding the Sarawak government’s purported further acquisition of stake in Affin Bank Berhad from the Lembaga Tabung Angkatan Tentera (LTAT).
However, he said that the reported 20 per cent stake targeted by the Sarawak government was inaccurate.
“I do not dare to comment as the bank (Affin) is a listed company. What I can tell is that the figure (reported in the media) is incorrect.
“But as the saying goes, if there is no wind, the flag will not flap,” he told reporters during a site visit to Brooke Dockyard Industrial Heritage Museum here.
The Edge Malaysia had reported that the state government was keen to acquire an additional 15 per cent stake in the commercial bank, from its current 4.95 stake.
It reported that the Sarawak State Financial Secretary was close to concluding a memorandum of understanding (MoU) which would lead to a deal to acquire the additional stake.
Should the deal go through, the Sarawak government would be the third largest stakeholder in the bank with approximately 20 per cent, after Bank of East Asia which has a 23.79 per cent stake.
LTAT will remain the single largest shareholder with a direct and indirect stake of 35.3 per cent.
Sources told The Edge that talks have progressed well, and the MoU is expected to be signed soon.
The move aligns with Sarawak’s interest to buy into a financial institution that has been on for some time now.
However, regulatory considerations may influence the final outcome, as Section 46 of the Banking and Financial Institutions Act 1989 limits the shareholding of a banking institution to not more than 20 per cent for corporations and 10 per cent for individuals.
The report said that while there are exceptions, it remains to be seen whether Bank Negara will allow Sarawak a larger stake in Affin Bank.
Meanwhile, Abang Johari clarified that state-owned Development Bank of Sarawak (DBOS) would not be involved in any potential acquisition of shares in Affin Bank.
He emphasised that DBOS, functioning as a non-commercial entity, primarily focuses on providing loans to finance state government projects.
He also revealed that the state government’s application to establish a digital bank had not gained approval from Bank Negara Malaysia.
However, he alluded to an unexpected development, stating that ‘something’ had suddenly come to the state government.
“Let’s wait and see what will happen,” he said.
On Jan 12, Abang Johari said that Sarawak was going to acquire another ‘strategic entity’ to assist businesses and entrepreneurs in the state. However, it is unclear if he was alluding to the state increasing its stake in Affin Bank.
He said at the time that he could only reveal the details within a month or two, adding that it would be one of the three major entities that Sarawak would take over this year after Bintulu Port and MASwings.