AMBANK

4.200

+0.03 (+0.7%)

OTHERS AMMB HOLDINGS BERHAD (AMMB OR THE COMPANY) - GLOBAL SETTLEMENT PROPOSAL

AMMB HOLDINGS BERHAD

Type Announcement
Subject OTHERS
Description
AMMB HOLDINGS BERHAD (AMMB OR THE COMPANY)
-	GLOBAL SETTLEMENT PROPOSAL

INTRODUCTION

 

We were informed by the relevant authorities with regards to their on-going review of overall transactions by 1Malaysia Development Berhad (“1MDB”) and its related entities (“1MDB Companies”).

 

The Group has since strengthened and enhanced its processes under the current respective entities’ boards and management teams. However, against this background, it is in the best interest of the AMMB Group to reach a settlement on all of these historical matters so that the AMMB Group may focus fully on its current businesses.

 

Arising therefrom, the Board of directors of AMMB (“Board”) wishes to announce that the Company has to-date reached an agreement with MOF for a sum of RM2.83 billion (”Payment Sum”) to be paid towards the full and final settlement (“Global Settlement”) in relation to all these historical matters.

 

A provision for the Payment Sum will be established in the final quarter of the Company’s financial year ending 31 March 2021. While this will have a material impact on the current year’s profitability, there are adequate capital buffers to absorb this settlement without an immediate need to raise additional equity capital.

 

We have been rebuilding the banking group through our new management team under the leadership of our Board, strengthening our governance structures as well as enhancing the robustness of our processes. As part of the global settlement, we will continue as we have for the past five years, to strengthen our fundamentals, particularly in terms of corporate governance by continuing to improve our systems and processes to strengthen due diligence. We are therefore committed to putting these historical matters behind us and move forward to deliver value to all shareholders, stakeholders and customers.

 

 

EFFECTS OF THE PROPOSAL

The Global Settlement is not expected to have any effects on the issued share capital of AMMB Group and substantial shareholders’ shareholdings of the Company.

 

Net assets (“NA”) per share and Capital Ratios

Based on the latest consolidated financial statements of AMMB Group as at 31 March 2020, the proforma effects of the Global Settlement will reduce the NA per share from RM6.18 to RM5.22.

 

As at 31 December 2020, the estimated proforma impact to Core Equity Tier 1 (“CET1”) and Total Capital Ratio (“TCR”) ratio is estimated to be reduced from 13.52% to 11.01%; and 16.39% to 13.88%, respectively after the proposed provision for the Global Settlement.

 

The Group remains highly liquid with Liquidity Coverage Ratio (“LCR”) of 155.8% and Net Stable Funding Ratio (“NSFR”) for all operating entities above 100%. However, the Group plans to raise Tier 2 debt capital to increase total capital available for on-going working capital purposes.

 

Earnings per share (“EPS”) and Dividends

The Global Settlement is expected to have a material impact on the earnings of the Group for the financial year ending 31 March 2021. A provision for RM2.83 billion will be established for the Global Settlement in the final quarter of the Group’s financial year ending 31 March 2021, which will translate to a proforma loss of 93.89 sen per share.

 

As a result of the Global Settlement, the Company will not be proposing any final dividends for the financial year ending 31 March 2021.

 

In conclusion, the Board wishes to assure all its shareholders and other stakeholders that the AMMB Group remains resilient as we continue to build on the efforts by the new management team and direct our renewed focus to the growth strategies of AMMB’s branding and franchise.

 

This announcement is dated 26 February 2021.




Please refer attachment below.

Attachments

Media Statement - FINAL.pdf
86.8 kB



Announcement Info

Company Name AMMB HOLDINGS BERHAD
Stock Name AMBANK
Date Announced 26 Feb 2021
Category General Announcement for PLC
Reference Number GA1-26022021-00177