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Malaysia's banking sector ripe for consolidation

Executives from Malaysia’s top investment funds said that the country’s crowded banking sector can benefit from mergers and acquisitions. Rick Ramli, Permodalan Nasional Bhd’s (PNB) chief investment officer for private and strategic investments, said there are opportunities to cut costs and compete with new entrants into the industry in consolidation. Rick’s comments come as Malaysia’s banking industry is set to get yet more competitive, following the issuance of five digital banking licences by the central bank at the end of April. Amir Hamzah Azizan, chief executive at the Employees Provident Fund (EPF), said Malaysia’s banking sector had about 26 firms, with the top five lenders commanding a combined market share of about 48%. Sovereign wealth fund Khazanah Nasional managing director Amirul Feisal Wan Zahir also said consolidation was logical, but it depended on timing and pricing.

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