CIMB Group and RHB Capital are intending to scrap the proposed $20bn merger, which would have formed the largest banking group in Malayaisa.
This decision was taken after the firms failed to agree on new terms, reports Reuters, citing people familiar with the matter.
This merger would have created a banking group carrying assets worth approximately $190bn, larger than Malayan Banking Bhd (Maybank).
The merged entity would have been the fourth-largest bank in South East Asia.
The companies are believed to have looked at the renegotiating terms of the MYR72.5bn ($20.3bn) deal, reports The Malay Mail Online.
Reuters reported that the announcement pertaining to the latest development will be made by the end of the week.
The deal was claimed to be part of a plan of Malaysia to promote its firms as champions in the region.
CIMB has a wide retail branch network with 1,080 branches across the region and operates under several corporate entities, which include CIMB Investment Bank, CIMB Bank, CIMB Islamic, CIMB Niaga, CIMB Securities International and CIMB Thai.
The group’s business activities are in the areas of consumer banking, wholesale banking, comprising investment banking and corporate banking, treasury & markets, and group strategy and strategic investments.
Image: The proposed merger was aimed at creating one singe banking group in Southeast Asia. Photo: courtesy of adamr/ FreeDigitalPhotos.net