RHB Capital Bhd says it has been formally notified by CIMB Group Holdings Bhd and Malayan Banking Bhd (Maybank) that Bank Negara Malaysia has no objection in principle for them to commence talks with the group and its substantial shareholders for a possible merger of the businesses.

'The proposed negotiations will be deliberated by the Board and further announcement on the developments will be made in due course,' RHB Capital said in a filing to Bursa Malaysia today.

Yesterday, both CIMB and Maybank announced that the central bank had given the nod approval for the country's two biggest banking groups to commence negotiations on a possible merger with RHB Capital. The central bank approval is valid for three months.

RHB Capital is the fourth largest banking group in Malaysia. -- Bernama