Merger is off. CIMB, RHB, MBSB.

I have written about this earlier. Read here: CIMB, RHB, MBSB potential merger. Just 1 cent view.  Let me conclude it for now since the merger has since been called off. Majority of all the reports are relieved that the merger did not go through. To them, the market situation has changed. The merger would no longer provide such a huge cost savings anymore. The staffs who would have been offered severance packages may choose not to accept it as it may be harder to find a new job under current situation. One report even mentioned that the staffs of RHB Capital Bhd happy that this deal is finally called off. It said that for Maybank, their senior managers are unhappy because if the merger had happened, Maybank would be able to gain from CIMB, RHB and MBSB’s distraction from the integration process.
Sorry, I beg to differ. I feel that irregardless of the market situation, the merger should proceed. For this particular case, I think just too many people were opposing it and all the three parties felt that perhaps all these people who were objecting may be right. If they have proceeded, perhaps it may bring too much negative energy into the three organisations and this may caused the whole process to take not just a lengthy period but the business may be affected. I have no idea but since everyone has said many things about this merger, I would like to also say my share.
When we look at how the world is evolving, it meant that banks must continue to restructure to be LEANER. Just look at the recent Standard Chartered’s case. It cut 4,000 jobs all over the world. Read here: 4,000 cut, locked out even. This is definitely not the last case that will happen to banks all over the world, especially the more traditional ones where internet has never been a huge strategy. For Malaysia, CIMB, Maybank has been at the forefront of internet banking. Both their online banking sites are ranked very high in Malaysia. This meant that sooner or later, the cuts would still happen.  Now, imagine if three banks are merging and it becomes leaner so that it’s more competitive for the future. For now, the merger of 3 is no longer happening but I think the next proposal is not that far away. CIMB or Maybank would definitely be interested in other smaller banks. We will see.
written on 17 Jan 2015
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