DMG & Partners Securities Pte Ltd (branded as OSK-DMG) is now a member of the RHB banking group, a leading financial services provider in Malaysia. This follows the successful business merger between RHB Investment Bank Bhd (RHBIB) and OSK Investment Bank Bhd (OSKIB) on April 13, 2013. OSK-DMG is a joint-venture between Deutsche Asia Pacific Holdings Pte Ltd (a subsidiary of the Deutsche Bank Group) and OSKIB.
With the merger, the 51% stake previously held by OSKIB is now owned by RHBIB.In a statement, Kellee Kam,group managing director of the RHB banking group said RHBIB is now the largest investment bank in Malaysia by assets and one of the largest investment banks in the Asean region. It has a staff strength of over 3,600, shareholders’ funds of over RM2bil and a comprehensive network of close to 100 offices in seven countries across Asean and Hong Kong. RHBIB is one of the top three brokerage houses in Malaysia, with over 1,400 brokers and 60 branches.
The point of view: In order to sustain the successful business merger,one should have leadership and stewardship by ensuring strategic direction and planning. Empowered and accountability are one of the way to sustain it by delegating authority. Service and fairness plays the important role of it as it is a setting an example in corporate social responsibility. In additional,accomplishment and measurement is also important by monitoring and overseeing the management.
Besides that,board meetings for the end of year is needed in order to get to know event or task that they are planning,organizing,leading and the cooperative of the employees. OSK-RHB merged entity will be top 3 investment banking group in Malaysia OSK Investment Bank Bhd will bring its expertise in the regional investment banking business and small and mid-cap companies in a merger with RHB Banking Group. Contrary to some views the proposed merger was an overlapping one, the merged entity would be synergistic.OSK Investment Bank has about 3,500 employees in its investment banking business across Malaysia, Indonesia, Thailand, Singapore, Cambodia and Hong Kong with representative offices in China.
RHB has more than 700 employees in its investment banking business. Analysts said the merged entity would be one of the top three investment banking groups in Malaysia. U said investment banking is a talent-driven business and with a strong pool of talent, it will definitely be good for the merged entity.At present, investment banking contributes about 50% to OSK Holdings group’s earnings compared with slightly less than 30% from stockbroking.
Some analysts believe the proposed merger with RHB would help OSK tap into the former’s commercial banking business in the country and in the region and would generate bigger commercial banking deals for the enlarged group. U reiterated that at this stage, both organisations were still awaiting Bank Negara’s approval to commence negotiations on the proposed merger.On 27th Sept, RHB Capital Bhd and OSK Holdings Bhd submitted their applications to the central bank to begin talks on a possible merger. OSK was speculated to be one of the possible candidates for a merger with RHB Cap earlier this year but this was overshadowed by Malayan Banking Bhd and CIMB Group Holdings Bhd.
Maybank and CIMB backed off due to pricing issues, and speculation that a merger might be in the works had not subsided, especially after it was reported that Aabar was considering a writedown of the US$1. 9bil (RM5. 7bil) it paid for RHB Cap, in the hopes of spurring another round of merger talks.The point of view: OSK Investment Bank is the fourth largest retail broker in the country (with a 6.
7% market share) and RHB Cap is the third largest, making the merged entity the top stockbroker in Malaysia. In Singapore, via OSK DMG, the group has the largest security broking business. After combining OSK’s market share with RHB Cap’s 7%, the merged entity would overtake CIMB Securities which is currently leading with a market share of 10. 5%.
In terms of research, OSK Investment Bank has more than 50 staff covering about 400 stocks in the region and this would definitely be synergistic to RHB.
