DBS Group, Singapore’s largest bank, is considering acquisitions in Malaysia as part of its regional expansion strategy, according to sources.
Reuters has learned that potential targets include a 29.1% stake in Alliance Bank Malaysia held by Singapore state investor Temasek, valued at around US$460 million.
Furthermore, DBS is reportedly considering purchasing retail banking assets from Malaysia’s Kuwait Finance House, reportedly worth more than $500 million.
Both acquisitions would require approval from Malaysia’s central bank, Bank Negara Malaysia.
These discussions are still at a preliminary stage and no agreement has been reached, the sources warned.
Kuwait Finance House confirmed that the sale of its Malaysian business assets was at an preliminary stage, but declined to provide further details.
Meanwhile, both DBS and Temasek declined to comment.
Malaysia’s improving economic outlook, supported by new infrastructure projects and growing investments, has made it an attractive market for financial institutions.
Rival Singaporean banks OCBC and UOB already operate retail banking operations in the country, leaving DBS as the only major player without a presence.
The move would mark DBS’s renewed interest in Malaysia after an unsuccessful attempt to acquire a stake in Alliance Bank in 2012 due to regulatory hurdles.
However, the current government led by Prime Minister Anwar Ibrahim is said to be more receptive to foreign investment.
Under the leadership of outgoing CEO Piyush Gupta, DBS entered major markets such as China, India, Indonesia and Taiwan through targeted acquisitions.
The bank’s purchase of Citigroup’s consumer banking business in Taiwan last August highlights this expansion strategy.
Gupta also emphasized pursuing “targeted” acquisitions to support the bank’s growth in Asia, with its potential entry into Malaysia aligning with this vision.
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