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ISLAMIC BANKING | Cesar Tordesillas, Malaysia

Affin to buy 30% Bank Muamalat stake

Malaysia's central bank has given Affin Holdings permission to negotiate with DRB-Hicom on Bank Muamalat sale.

DRB-Hicom has been told to reduce its stake to a maximum of 40 percent.

DRB-Hicom, a Malaysian auto-to-insurance conglomerate, bought its 70 percent stake in Bank Muamalat from Bukhary Capital in 2008. The government's investment holding arm Khazanah Nasional owns the other 30 per cent.

"The matter is in Bank Negara's hands now," the source said, adding that a deal should be completed by the end of the year.

DRB-Hicom, controlled by billionaire Syed Mokhtar Al-Bukhary, had tried to reduce its stake in Bank Muamalat with a sale to Bank Islam Malaysia last year and previously to Bahrain-based Islamic lender Al Baraka Banking Group.

The deal would make Affin Malaysia's fourth-largest Islamic lender by assets.

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