Maybank Board Revamp A Normal Transition, Says CEO

KUALA LUMPUR-
Malayan Banking Bhd (Maybank)'s board revamp is part of a normal transition, its chief executive officer Datuk Seri Abdul Wahid Omar said Monday.

"It is a normal course of transition," he said when asked to comment on a Singapore's Straits Times report which stated that the revamp was directed by Bank Negara Malaysia which was not happy with the high price that Maybank paid for the acquisition of Bank Internasional Indonesia (BII).

Maybank will give further details during the announcement of its financial year results on August 25, he told reporters on the sidelines of the World Capital Markets Symposium here.

The report quoted a senior government official who was involved in top-level discussions on Maybank's Indonesian venture as saying that the little-publicised revamp followed government displeasure at the controversial acquisition by Maybank last year.

The official said that the board revamp will be carried out in stages and directors who are retiring will not be re-elected to the board.

Maybank entered into an agreement to buy a 55 percent interest in BII from Sorak Financial Holdings in March 2008, which was majority-owned by Singapore's Temasek Holdings.

It agreed to pay US$1.5 billion (RM5.3 billion) for the stake and then made a tender offer for the remaining 44 percent for roughly US$1.2 billion.

Minority Shareholder Watchdog Group's chief executive officer Rita Benoy Bushon, when met during the symposium, said it was a normal process if the central bank asked to revamp the board of directors.

"However, the decision on Maybank is quite abnormal and sudden. It is surprising," she said, adding that the watchdog group would study the issue.

Maybank's main shareholders are national equity fund Permodalan Nasional Berhad and pension fund Employees Provident Fund.

Maybank sent a statement providing reasons for its board of directors' revamp on July 15 when announcing the retirement of two directors and the appointment of three new members.

In explaining the changes, Maybank then said the appointments represented a significant development in the ongoing transition and succession planning exercise implemented by the board following an initiative formulated in 2007.

"In the interest of the organisation, the execution of the transition and succession planning exercise also takes cognizance of the need to maintain elements of continuity in the composition, proceedings and stability of the board," it said.

"The board's transition and succession planning exercise is designed in line with international best practices on board governance and effectiveness," it added.

Between end-October last year, when the acquisition of BII was completed, and March this year, three of its directors have resigned.



Source BERNAMA, Aug 11