Malaysian government willing to sell Bank Bumiputra

Malaysian government willing to sell Bank Bumiputra

KUALA LUMPUR (AFP): The Malaysian government is willing to divest all of its stake in Bank Bumiputra Malaysia Bhd., the country's second largest bank, to an appropriate party through proper procedures, officials said.

"The government is agreeable to the idea of selling the bank to a party which we think can manage the bank well," said Deputy Premier Anwar Ibrahim.

But he declined to comment on market speculation that local hotel developer Landmarks Bhd. had been earmarked for the possible takeover of the once-beleaguered state-owned bank.

Treasury officials said the application would have to be done through the proper channels made through Bank Negara, the central bank.

Banking analysts said the government, which has twice bailed the bank out of financial difficulties, wanted to sell the bank.

The market has been rife with speculation that the chairman of Landmarks, Samsudin Abu Hassan, was using the listed firm to take over 60 percent of the bank in a bid placed at 1.7 billion ringgit (US$680 million).

But Landmarks subsequently denied the rumor.

Bank Bumiputra, wholly-owned by the Minister of Finance Inc., -- the government's investment arm -- has assets of over 23 billion ringgit ($9.2 billion), but is believed to have accumulated losses of more than one billion ringgit at the end of last year.

The bank, which was set up 29 years ago largely to provide financial assistance to indigenous Malaysians, had earlier suffered sharp declines in profit and subsequently underwent a management shakeup.

It was expected to post a pre-tax profit of 350 million ringgit for the year to March 31 from 80.61 million ringgit previously.