Malayan Banking Bhd., Malaysia’s biggest lender, raised 3.66 billion ringgit ($1.2 billion) in the biggest share sale by a Southeast Asian bank in three years.
The lender sold 412 million new shares at 8.88 ringgit each to local and foreign institutions after increasing the size of the offering to satisfy “strong” demand, Kuala Lumpur-based Maybank said in an e-mailed statement today. The final price was higher than the 8.80 ringgit earlier indicated.
Maybank, which plans to use the proceeds to bolster capital and expand in the region, would consider buying a retail bank in Thailand, Chief Executive Officer Abdul Wahid Omar said last year. General Electric Co. said last month that it’s reviewing options for its remaining stake in Bangkok-based Bank of Ayudhya Pcl after selling an initial 7.6 percent.
“Bank of Ayudhya will be a good vehicle to enlarge exposure to Thailand given its high net interest margin and niche in consumer loans,” Low Yee Huap, an analyst at Hong Leong Financial Group Bhd., wrote in a report today. “We suspect it could be to bid for General Electric’s 25 percent stake in Bank of Ayudhya,” he said, referring to Maybank’s fund raising.
The Malaysian lender has been expanding in Southeast Asia to reduce its reliance on domestic earnings, acquiring Singapore brokerage Kim Eng Holdings Ltd. last year. It already owns bank stakes in Indonesia, Pakistan and Vietnam.
The placement was the largest equity sale by a Southeast Asian lender since Maybank raised $1.63 billion through a rights issue in 2009, according to data compiled by Bloomberg. The price is a 1.2 percent discount to the 8.99 ringgit that the stock closed at in Kuala Lumpur on Oct. 5.
Shares of Maybank have risen 4.3 percent this year, underperforming an 8.3 percent gain in the benchmark FTSE Bursa Malaysia KLCI Index. The stock fell 0.4 percent to 8.95 ringgit as of 12:23 p.m. in Kuala Lumpur trading.
“We believe GE’s intended exit from Bank of Ayudhya provides Maybank a good opportunity to explore,” Lim Sue Lin, an analyst at HwangDBS Vickers Research Sdn., wrote in a report today. “This would be positive as Maybank positions itself as a regional bank.”
Maybank, which earned 28 percent of pretax income from overseas operations in the six months ended June 30, plans to generate 40 percent of operating profit from outside Malaysia by 2015, Wahid said in August last year. It wants to be in all major markets in Southeast Asia by that date, he said.
-- Editors: Barry Porter, Chitra Somayaji