Image Credits: The Edge Malaysia
Sarawak is poised to formalize a significant deal on Friday that will elevate its stake in Affin Bank Bhd to approximately 30%. This development follows a protracted negotiation process and will involve a sale and purchase agreement with two of the bank’s existing shareholders: Lembaga Tabung Angkatan Tentera (LTAT) and Boustead Holdings Bhd. The signing is scheduled to take place in Kuching.
Currently, LTAT holds a 28.88% stake in Affin Bank, while Boustead, wholly owned by LTAT, possesses about 20%. Sarawak’s acquisition will include Boustead’s entire stake and a portion of LTAT’s shares, positioning Sarawak as the largest shareholder in Affin Bank. Presently, Sarawak holds a modest 4.8% stake.
The announcement of the impending acquisition has already positively impacted Affin Bank’s stock, which rose 4.5% to close at RM3 on Monday, translating to a market capitalization of approximately RM7.2 billion. Sarawak Premier Tan Sri Abang Johari Tun Openg indicated that the state expected to announce the acquisition details soon, noting that discussions had already addressed regulatory matters with Bank Negara Malaysia (BNM).
In a previous interview, Abang Johari revealed that Sarawak received conditional approval from BNM for the transaction on June 12. While some minor regulatory requirements remain, he expressed confidence in completing the process shortly. The financial terms of the deal were settled on a “willing buyer, willing seller” basis.
Sarawak’s interest in owning a stake in a bank stems from a historical context, as several banks originally established in the state were absorbed during a federal government consolidation policy post-Asian Financial Crisis. The state views this acquisition as a means to enhance support for small and medium enterprises and boost local business activities.