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GLOBAL:
Malaysia-based CIMB Group, the parent company of one of the world’s
largest Islamic banks (CIMB Islamic), is currently considering the
acquisition of Philippines’ Al-Amanah Bank.
According
to local sources, Al-Amanah ceased operations some time ago. With an
asset base of PHP1 billion (US$23.06 million), the bank is reportedly
in need of up to PHP100 billion (US$2.3 billion) in fresh investments
in order to resume functionality.
The
bank is majority-owned by the Development Bank of the Philippines (DBP)
and is in dire need of recapitalization in order to provide Islamic
banking services in the country and compete in the ASEAN economic
community for 2015.
One
of the reasons for DBP’s sale of its ownership in the country’s sole
Islamic bank may be due to its lack of technical expertise in Islamic
banking.
Speaking
to reporters at a roundtable with Alliance for Halal Integrity in the
Philippines, Aleem Siddique Guiapal, the director of the Muslim
Economic Affairs of the National Commission on Muslim Filipinos, said
that CIMB’s acquisition would also be a move to boost the bank’s
regional presence. He was however of the opinion that Al-Amanah should
be retained and developed by the Filipino government.
CIMB
previously expressed interest in acquiring another Filipino bank, Bank
of Commerce, but this fell through as the Filipino institution was not
able to meet the 5% minimum Halal compliance rule.
CIMB’s
acquisition of Al-Amanah Bank could be the Malaysian bank’s first
direct foray to tap into Philippines’ burgeoning Islamic banking
market. No comments were available from the bank at the time of going
to press.
CIMB
is also currently evaluating a merger with two of its local peers, RHB
Capital and Malaysia Building Society with a view to set up an Islamic
megabank.
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