Malaysia's CIMB to Divest Stakes in Two Asset-Management Companies

Cornelia Mascio
Gennaio 13, 2018

(1023.KU), Malaysia's second-largest bank by assets, said Thursday it had signed agreements to divest stakes in two of its asset-management companies to units of Principal Financial Group for MYR470.3 million ($117 million). "This shareholding realignment will ensure that our asset management joint venture with Principal achieves its maximum potential and continues to sustainably create value for CIMB", said Tengku Dato' Sri Zafrul Aziz, Group Chief Executive Officer, CIMB Group.

CIMB is expected to recognise a gain on disposal of RM950 million and a common equity tier 1 ratio improvement of 18 bps after the divestment. Upon completion, US -headquartered Principal will raise its stakes to 60% in the entities while CIMB will retain 40% stakes.

The transaction is expected to be completed in the second quarter of 2018 and is subject to the relevant approvals.

Des Moines-based Principal Financial Group is expanding its presence in Southeast Asia.

CIMB and Principal partnered in 2004 and has operations across Malaysia, Singapore, Indonesia and Thailand.

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