Merger of three mega banks may not happen

The merger of three mega banks- CIMB Group Holdings Berhad (CIMB), RHB Capital Berhad and Malaysia Building Society Berhad (MBSB) may not happen, sources said.

According to a Bloomberg report, sources close to the businesses said the plan is no longer relevant in the current state of the industry.

The source also said that an official statement on the scrapping of the agreement will be announced before the end of this week.

The three-way merger also involves the taking over of MBSB which would then form a mega Islamic bank.

The merger would have been the biggest in Malaysia, Bloomberg reported.

However, a market analysis who does not wish to be named said the merging plan might still be carried out as the Bank Negara is persistent in wanting to reduce the number of banks in Malaysia.

Malaysia has eight commercial banks in the country. Ideally, it should be three or four.