BANKING consolidation in corporate Malaysia has not been smooth sailing. While there have been successful merger and acquisition (M&A) activities, there have also been unsuccessful attempts to consolidate.

The notable fallout involved a three-way merger between CIMB Group Holdings Bhd, RHB Capital Bhd (now RHB Bank Bhd) and Malaysia Building Society Bhd (MBSB) in 2015 to create the biggest banking group in the country and one of the largest banking entities in South-East Asia. With combined assets estimated at RM613bil, the merged entity would have overtaken Malayan Banking Bhd (Maybank) as the largest banking group in the country.

The deal fell through because of market conditions amid falling crude oil prices, as it was no longer seen as cost-effective.

MBSB was dealt with another blow when its proposed merger with Bank Muamalat Malaysia Bhd was aborted due to disagreements over valuations and control. The non-bank lender received the green light from Bank Negara at the end of last year to start negotiations on a proposed merger with Asian Finance Bank Bhd (AFB).

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