KUALA LUMPUR: The Sarawak government will proceed with its acquisition of Affin Bank Bhd even though its plans to wrap up the deal may have been scuppered, slightly.

On Friday, media organisations were initially invited by the Sarawak Public Communications Unit (Ukas) to a signing ceremony here with regards to the "acquisition of shares". However this was subsequently changed to the signing of a memorandum of understanding (MoU).

A financial weekly reported earlier that a planned sale and purchase agreement (SPA) between Sarawak and Affin Bank's biggest shareholder the Armed Forces Fund Board (LTAT) had been delayed.

The Edge, quoting sources, said an MoU would instead be signed on Friday to "explore strategic investments between the two parties".

Both parties delayed the signing of an SPA as the Sarawak government looked to "clarify some conditions" that Bank Negara Malaysia had attached to the deal, it added.

Sarawak Premier Tan Sri Abang Johari Abang Openg said both parties will proceed with the SPA upon securing the necessary regulatory approvals.

"We believe that Affin Bank can have access to the network under the wider Sarawak where it can work together and leverage on its investment banking and treasury capabilities," he said at the signing ceremony of the MoU between the Sarawak government and LTAT here today.

The MoU is for potential collaboration which are of common interest and benefits to both parties, the state government said. This is particularly in six priority sectors namely manufacturing, commercial agriculture, tourism, forestry, mining and services.

According to Abang Johari, the planned acquisition, if materialised, will help to expand the Affin Bank's environmental, social and governance (ESG) credentials as well as increasing its sustainable financing initiatives under its five-year ESG Roadmap.

He said the wider Sarawak has several green initiatives in the pipeline, and he believes there are opportunities for Affin Bank to participate and expand its ESG portfolio.

Abang Johari also said that Affin Bank can expand its retail customer base as there are untapped potentials in the retail market in Sarawak.

Overall, he said opportunities to work with Affin Bank are wide, among others in areas of promoting cashless payments and adoption of digital banking in Sarawak.

"Additionally, Affin Bank can explore collaborations to support SMEs in providing access to affordable financing, whilst increasing literacy and leveraging on Affin Bank's networking platform.

"We believe this will have an added impact to Sarawak's development as this would provide a financial platform to boost the economy further through the development of small and medium enterprises and entrepreneurship programs and to serve Sarawak in general," he added.

https://www.nst.com.my/business/corporate/2024/07/1078994/delay-stake-sale