International Finance

Aabar prepares to sell 9.9% stake in Malaysia’s RHB Bank

Aabar Investments, RHB Bank
Aabar disposed 3 percent stake or $191 million shares in RHB Bank in March this year

Aabar Investments announced that it is willing to sell its entire 9.9 percent stake in RHB Bank, according to The Star. Aabar Investments is an indirect subsidiary of Abu Dhabi sovereign wealth fund Mubadala Investment.

Aabar was previously owned by the International Petroleum Investment established by the Government of Abu Dhabi and later acquired by Mubadala under a restructuring plans in 2016.

In March this year, Aabar  disposed 3 percent stake or $191 million shares in RHB Bank between RM5.43 and RM5.54 per share through a book-building exercise. Aabar owns a 14.75 percent stake in RHB Bank before the sale.

RHB Bank shares fell to RM5.63.

In the first quarter ended March 31, RHB Bank’s net profit came in 6.7 percent higher year-on-year to RM630.2 million from RM590.82 million. The higher profits came as a result of lower credit losses on loans and other financial assets, in addition to reduced operating expenses.  

RHB said, “We continue to be prudent in loan loss provision with loan loss coverage standing at 106.3% as at end March 2019.”

The bank’s domestic loan market share reached 9.1 percent at the end of March 2019.

RHB said that the credit losses was at RM72.9mil, which is 36.4 percent lower than the previous year. This is because of ‘lower allowances for loan impairment and higher write-back in losses for financial securities’, The Star reported. That said, the bank’s customer deposits increased by 9.5 percent, resulting in a healthy liquidity coverage ratio of 155.3 percent.

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