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Expanding CIMB acquires Finansa Asset

CIMB GROUP HOLDINGS, the parent of the second-largest bank in Malaysia, has taken over Finansa Asset Management as part of its ambition to expand in the region and in the Thai market through both organic growth and acquisitions - not always in the same business.

CIMB CEO Nazir Razak said yesterday that the latest move by its fund unit in Thailand, CIMB-Principal Asset Management Co (CPAM), would broaden the group's footprint in this country.

"Finansa Asset Management is strong in provident funds, which is the focus of CIMB in growing in this category. After the acquisition, assets under management of the provident fund of CPAM rose to Bt25.54 billion, ranking it in eighth place in the fund management industry in Thailand," he said at the signing of the Bt225 million deal.

This acquisition will increase total AUM of CPAM to Bt70.35 billion from Bt34.05 billion currently.

The group is satisfied with the first-half performance of CIMB Thai Bank even though CIMBT's profit increased slower than targeted, as it understands that CIMBT did not have an easy job given the uncertainty in this country.

CIMBT showed impressive performance in terms of investment and wholesale banking.

CIMBT reported first-half net profit growth of 15 per cent on year to Bt625.05 million.

CIMBT CEO Subhak Siwaraksa said the bank's contribution to the group's income has climbed to 6-7 per cent from 2 per cent over the past few years. However, it is lagging behind the target of 10 per cent for 2015.

CIMBT's profit contribution might fall short again because the group is discussing a merger with RHB Capital and Malaysia Building Society, which would increase the assets of the group.

CIMBT has maintained its loan growth target for this year at 15 per cent after achieving 4 per cent in the first half, as the economic situation is improving, he said.

Razak said that even if the merger goes through, the group has no plan to combine CIMBT and RHB in Thailand because RHB here is too small.

The three companies entered into a 90-day exclusive agreement to negotiate and finalise the price and structure of the merger.

The merger will ensure the meaningful role of a mega Islamic bank in Asean, he added.

CIMB Group alone is seeking banking licences in the Philippines, Vietnam and Myanmar to achieve its goal of opening branches in all Southeast Asian countries by next year.


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