AMMB mum on RHBCap merger talk

KUALA LUMPUR: AMMB Holdings Bhd, the country's fifth largest banking group, remains tight-lipped over merger rumours with RHB Capital Bhd.

"We are open to any exercise that brings value to the bank's
stakeholder. When there is an opportunity that presents itself, we are
open to it," group managing director Cheah Tek Kuang said during a media
briefing to announce its financial results yesterday.

The
recent RM5.1 billion EON Capital Bhd takeover bid by Hong Leong Bank Bhd
has put pressure on "small" local banks, mainly to consolidate as they
seek the size to compete domestically and to tap regional markets.

AMMB is seen as heavy favourite to merge with RHBCap as the former's
substantial shareholder Australia and New Zealand Banking Group (ANZ)
was speculated to be a front runner to buy Abu Dhabi Commercial Bank's
25 per cent stake in RHBCap.

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ANZ owns 23.8 per cent of AMMB.

Meanwhile, AMMB deputy group
managing director and chief financial officer Ashok Ramamurthy said it
will leverage on ANZ's international connectivity to develop its
businesses in the region.

"Through this partnership, we can
expand our product and service offerings for cross border opportunities
to a wider distribution network. Among the products the bank can offer
are wealth management, priority banking and Islamic banking," he said.

On speculation that ANZ may want to increase its stake in AMMB, Ashok
said ANZ has already had Bank Negara Malaysia's approval to raise its
stake to 26.2 per cent. It was granted when the Melbourne-based lender
first bought its stake in AMMB.

Foreign ownership in local banks is capped at 30 per cent.

Meanwhile, AMMB's net profit for the year ended March 31 2011 increased
by 33.1 per cent to RM1.34 billion against RM1.01 billion previously,
on the back of RM7.11 billion in revenue.

In the fourth quarter alone, the net profit rose 30.8 per cent to RM316.4 million from RM241.8 million a year ago.

The bank attributed its growth mainly to an increase in income reported
from other operating incomes and net interest incomes of RM47.1 million
and RM38.2 million respectively.

The group's revenue for the
quarter was at RM1.8 billion against RM1.66 billion before, while
earnings per share was 10.54 sen against 8.03 sen last year.

AMMB has proposed a final dividend of 12 sen a share.