Bank of Nova Scotia is in talks with Cathay Financial Holdings Co. to sell its Malaysian operations as the Canadian lender looks to exit a country it’s been in for 44 years.
The Taipei-based company’s Cathay United Bank and Cathay Life Insurance units have exclusive rights until April 30 to bid for Bank of Nova Scotia Berhad, according to a March 8 regulatory filing with the Taiwan Stock Exchange. The proposed takeover is subject to further negotiations and regulatory approvals from Taiwan and Malaysia.
“We are evolving our business in the Asia-Pacific region with a focus on serving cross-regional clients in priority sectors and core markets,” Debra Chan, a spokeswoman for Toronto-based Scotiabank, said last week in an emailed statement. “As a result, a decision was made, to enter into discussions with the goal of finding the right buyer for our franchise in Malaysia.”
The Canadian lender has been in Malaysia since 1973, and incorporated its operations there as Bank of Nova Scotia Berhad in 1994, according to the company’s website. The business, based in Kuala Lumpur, had assets of about USD4.37 billion Malaysian ringgit ($980 million) as of April 2016, according to financial statements. Scotiabank valued the company at CAD311 million ($230 million) in its 2016 annual report.
Scotiabank has been reviewing its Asia businesses while focusing on domestic banking. The lender closed its global banking and markets office in Taiwan and is reevaluating its 49 percent stake in Thai lender Thanachart Bank Pcl. Blooomberg
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