Middle Eastern consortium buys controlling share in Malaysian bank

20 February 2007

An Arabic consortium with plans to establish the world's largest Islamic bank is to buy a Malaysian bank.

The consortium, which is lead by Kuwait Finance House (KFH), has agreed to pay $617 million to Utama Banking Group (UBG) for its 33 per cent controlling share in Rashid Hussein Berhad (RBH).

UBG chose to sell to the consortium, which also comprises the Gulf Cooperation Council, after earlier negotiations with Primus Pacific Partners of Hong Kong and an offer from Malaysian bank EON Capital.

Commenting on the proposed sale a consortium spokesman said that the KFH is aiming to "create the world's largest, most innovative and respectable Islamic bank with extensive networks across the world".

Malaysia, which entered Islamic banking in 1983, has long-held ambitions to become a global centre in the sector amid recent competition from London and local rivals Singapore.

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