PETALING JAYA: Alliance Bank Malaysia Bhd is selling its stockbroking business that could be worth more than RM205mil to Phillip Futures Sdn Bhd.

       In a filing with Bursa Malaysia yesterday, Alliance Bank said the disposal was part of the group’s strategic plan to reprioritise its businesses to accelerate growth consumer, small and medium-sized enterprises (SMEs) and Islamic banking businesses.

       It aims to be among the top four banks in Malaysia by market share.

       Alliance Bank and Phillip Futures entered into a conditional business sale and purchase agreement for the proposed disposal.

       While the price of the stockbroking asset has yet to be determined, Alliance Bank said the cash consideration will be based on an amount equal to the net asset value of its stockbroking business, which stood at RM205mil as at Sept 31.

       The amount of cash for the proposed disposal will also equal to 60% of the aggregate brokerage fee in respect of all brokerage transactions concluded by Phillip Futures in respect of the 12-month period from the specified transfer point until the date, that is, the 12-month anniversary of the completion date.

       This came after Bank Negara’s approval on Dec 1 for the proposed disposal of the stockbroking business and capital markets business transfer.

       In addition, the Securities Commission granted its conditional approval in relation to the proposed disposal of Alliance’s Bank stockbroking business through a letter in November to Phillip Futures and Alliance Investment Bank.

       “The proposals will not have any material impact to Alliance Bank’s consolidated financial results for the financial year ending March 31, 2022,” said the banking group.

       Separately, Alliance Bank said it will also enter into a strategic stockbroking partnership arrangement with PhillipCapital Group, the parent company of Phillip Futures, to enable its customers to gain access to trading platforms and investment products.

       “The excess capital from the sale of the stockbroking business will be redeployed to accelerate growth in its consumer, SME and Islamic banking businesses,” Alliance Bank said.

       Meanwhile, Alliance Investment Bank’s capital markets business will be transferred to the bank’s other subsidiary, Alliance Islamic Bank Bhd.

       Alliance Bank expected to conclude the corporate exercise in the first half of 2022.

       “Our SME banking business has consistently outpaced the industry’s growth over the past five years. We aim to be among the top four banks in SME market share in Malaysia,” said group chief executive officer Joel Kornreich.

       “Our relationship managers take the time to truly understand our customers’ financial situation so that they can provide the most relevant solutions in a fast and simple manner.

       “Our goal is to serve the business and personal needs of business owners and the needs of their stakeholders,” he added.