Prospect of Investment Banking in Malaysia

[chenchow]

During recent visit of Pak Lah to China, he has arranged a closed-door meeting with CEO of Asia Pacific for 9 major investment bankers in Shanghai. Many of them have been flown specifically to Shanghai for that special meeting with Pak Lah.

Pak Lah is offering investment opportunities to those investment companies and perhaps luring them to invest in Malaysia and towards having major operations in Malaysia.

Those 9 are Merrill Lynch, Morgan Stanley, JP Morgan, Goldman Sachs, Credit Suisse First Boston, Citigroup, HSBC, Bank For International Corporation and Barclays Capital.

What do you guys of the prospects of these companies investing in Malaysia? Any other comments on anything related to this issue?

Guess this is a good step ahead. Pak Lah is offering 30% portfolio holding in various Government-linked corporations, like Telekom, Tenaga etc to interested parties, including foreigners.

[__earth]

if the banks invest in malaysia, i am not worried about the nine large investment banks. but i thought some of them are already in Malaysia? as i remember, there is a citibank malaysia hq near ampang park.

i am more worried for the local banks. =)

but on the bright side, i think KLSE could accumulate more capital faster with these biggies. more IPOs! w00t!

[chenchow]

I guess it is more for knowing each other, build contacts and also offer to these investment banks to source for potential stakeholders in government-linked corporations.

I guess as of now, Citigroup and HSBC are having their presence in Malaysia. So, I guess his mission would be to get their 7, to move from Singapore up north to KL!

[ElansarGelmir]

if the banks invest in malaysia, i am not worried about the nine large investment banks. but i thought some of them are already in Malaysia? as i remember, there is a citibank malaysia hq near ampang park.

i am more worried for the local banks. =)

but on the bright side, i think KLSE could accumulate more capital faster with these biggies. more IPOs! w00t!


Slowly, i think Malaysia's local banks would have to merge to 1 bank to compete against globalization. Somehow, i feel that local bank staffs are more lembap than foreign banks. The former carry their jobs very slowly, compared to foreign banks.

[chenchow]

I guess the merging processes initiated by Dr. Zeti, has been instrumental in gradually building up our local banking institution. I think having just 1 local bank would not really work. Right now, we have 10 local banks I believe, after lengthy process of mergers and acquisition. I believe that Bank Negara has plans to further merge those banks into about 5-6 solid local banks.

In fact, I think 1 bank would cause the issue of monopoly, guess 5-6 would be a case of oligopoly.

[chankingguan]

Well...i think it is one step in the right direction...for Malaysia annd the banks. As we all noe the 9 listed are multinationals which mean that their organization exists at an international level. This investors banks deal in financial instruments...they are not normal banks may I point out. Thus, the ability of them to develop the financial instruments arena..including bonds and securities in Malaysia will be benificial in the long run...as i might say Malaysia has a weakness in that area. Therefore, with their big capital and ability to invest, these companies can actually speed up the financial sector of this country to about 5 years ahead of current level. Besides that the presence of these companies...Merill Lynch is the biggest financial securities company in the world...the locals will be able to try out or even involve themselves in this area of investing and purchasing of financial instruments at an international level. However all these comes with a disadvantage...it will get us tied up more to the global economy...if for example...Jp Morgan Chase invests in Telekom. Assuming, JP Morgan Chase loses their lead as the most widely held stock in the US and decide to cut back on capital spending and decide to drop their 30% holdings in Telekom...the national telecommunications company will run aground. Therefore, it's a step in the right direction....to be taken with caution....hehehehe ( I always end my post with hehhehehe)

[weich]

think there's something like an opening of the market to foreign banks in a few years time..that's why...and you can already see HSBC setting up more branches and removing the 'minimum' deposit quota....but SEA's banking industries are mainly based in S'pore & Australia...and our market is too small and already 'monopolised' by CIMB if I'm not wrong =)

[windy_city]

Well...i think it is one step in the right direction...for Malaysia annd the banks. As we all noe the 9 listed are multinationals which mean that their organization exists at an international level. This investors banks deal in financial instruments...they are not normal banks may I point out. Thus, the ability of them to develop the financial instruments arena..including bonds and securities in Malaysia will be benificial in the long run...as i might say Malaysia has a weakness in that area. Therefore, with their big capital and ability to invest, these companies can actually speed up the financial sector of this country to about 5 years ahead of current level. Besides that the presence of these companies...Merill Lynch is the biggest financial securities company in the world...the locals will be able to try out or even involve themselves in this area of investing and purchasing of financial instruments at an international level. However all these comes with a disadvantage...it will get us tied up more to the global economy...if for example...Jp Morgan Chase invests in Telekom. Assuming, JP Morgan Chase loses their lead as the most widely held stock in the US and decide to cut back on capital spending and decide to drop their 30% holdings in Telekom...the national telecommunications company will run aground. Therefore, it's a step in the right direction....to be taken with caution....hehehehe ( I always end my post with hehhehehe)

Hehe, assume if (big if) that they wan to buy up 30% holding in telekom first before we start to worry that MAYBE they suddenly want to bail out.

[chankingguan]

Well, it's a good deal since telekom is running a monopoly in fixed line comm. in malaysia....heheheheheh...anyway 30% is nothing to them...hehehhehehe

[bestcreation]

guys, you are confusing investment banks with commercial banks.
Citigroup and HSBC are commercial banks with an investment banking arm.

The biggest investment bank in Malaysia is CIMB. The only other foreign I-bank in Malaysia is JP Morgan i think.

[Thirdshifter]

All comercial banks have their investment banking arm, and all investment bank have their commercial arm.. same difference.

[bestcreation]

nah. When was the last time you saw a Morgan Stanley, Goldman Sachs commercial bank branch?

They don't have a commercial banking business.

Conversely, not all commerical banks have a investment banking arm.
To the best of my knowledge, Bank Bumiputera is an example and so are the smaller banks.

Even big banks such as HSBC may think they have an investment banking arm when in reality they don't. At least not one that engage in the big deals.

[nick_khaw]

bestcreation is right.

It doesn't work on a universal basis.