KUALA LUMPUR: Banking stocks rose yesterday on talk that Bank Negara Malaysia (BNM) may raise the foreign ownership cap in commercial banks.
It is believed that the central bank will include the measure in its Financial Sector Masterplan (FMSP), which is due to be unveiled by year-end.
Among the sectoral movers, Maybank rose by 30 sen to RM8.32. Affin Bank up 4 sen to RM2.96, CIMB edged up 6 sen to RM7.36, AMMB 1 rose sen to RM5.97, BIMB grew 6 sen to RM2.07, Public Bank gained 2 sen to RM12.52 and Alliance Banking Group inched up 2 sen to RM3.42.
Analysts said in preparation for the FSMP, the central bank has been in talks with the banking sector, compiling feedback on what steps are needed to further liberalise the financial sector.
The last time such liberalisation took place was in 2009 when the government raised foreign equity limits from 49 per cent to 70 per cent of investment banks, Islamic banks, insurance companies and takaful operators.
The limit for commercial banks, however, remained at 30 per cent.
The rationale behind the move was to enhance the growth of financial institutions through the involvement of the global network of foreign shareholders.
Analysts, however, said it may not be wise to raise the cap on foreign shareholding, given the current global economic downturn.
"Even if BNM wants to do so, it has to be on a gradual or staggered time frame," said an analyst.
In a statement to Bernama, the National Union of Bank Employees (NUBE) expressed its concern over the matter, saying that the move has to be studied carefully.
Its secretary-general, J. Solomon, said with what is going on in Europe and its banks, any liberalisation in Asia may attract the European banks' interest for all the wrong reasons.
"Malaysia should not allow itself to be used by foreign banks for their own interests."
He said in drawing up the second financial sector masterplan, BNM should recognise the direction of the global economy and have the foresight to chart what is right for the economy and society.
Prime Minister Datuk Seri Najib Razak had in March said Malaysia was ready to relax its bank ownership rules and allow for foreign ownership of local financial institutions to go above 30 per cent.
AmBank and Affin Holdings are among Malaysian lenders with foreign shareholders.
The Australian and New Zealand Banking Group holds 24 per cent of AmBank and the same equity is being held by Hong Kong's Bank of East Asia in Affin Holdings.
It is believed that the central bank will include the measure in its Financial Sector Masterplan (FMSP), which is due to be unveiled by year-end.
Among the sectoral movers, Maybank rose by 30 sen to RM8.32. Affin Bank up 4 sen to RM2.96, CIMB edged up 6 sen to RM7.36, AMMB 1 rose sen to RM5.97, BIMB grew 6 sen to RM2.07, Public Bank gained 2 sen to RM12.52 and Alliance Banking Group inched up 2 sen to RM3.42.
Analysts said in preparation for the FSMP, the central bank has been in talks with the banking sector, compiling feedback on what steps are needed to further liberalise the financial sector.
The last time such liberalisation took place was in 2009 when the government raised foreign equity limits from 49 per cent to 70 per cent of investment banks, Islamic banks, insurance companies and takaful operators.
The limit for commercial banks, however, remained at 30 per cent.
The rationale behind the move was to enhance the growth of financial institutions through the involvement of the global network of foreign shareholders.
Analysts, however, said it may not be wise to raise the cap on foreign shareholding, given the current global economic downturn.
"Even if BNM wants to do so, it has to be on a gradual or staggered time frame," said an analyst.
In a statement to Bernama, the National Union of Bank Employees (NUBE) expressed its concern over the matter, saying that the move has to be studied carefully.
Its secretary-general, J. Solomon, said with what is going on in Europe and its banks, any liberalisation in Asia may attract the European banks' interest for all the wrong reasons.
"Malaysia should not allow itself to be used by foreign banks for their own interests."
He said in drawing up the second financial sector masterplan, BNM should recognise the direction of the global economy and have the foresight to chart what is right for the economy and society.
Prime Minister Datuk Seri Najib Razak had in March said Malaysia was ready to relax its bank ownership rules and allow for foreign ownership of local financial institutions to go above 30 per cent.
AmBank and Affin Holdings are among Malaysian lenders with foreign shareholders.
The Australian and New Zealand Banking Group holds 24 per cent of AmBank and the same equity is being held by Hong Kong's Bank of East Asia in Affin Holdings.
