Malaysia

Viewsroom: Fintech’s growing pains

19 April 2018

Upstarts like LendingClub and SoFi need to find ways to keep customers returning – just as traditional banks are fighting back and Goldman Sachs’ digital push into consumer lending takes off. Also: how Malaysia’s prime minister may be re-elected despite the 1MDB scandal.

Malaysia’s strongman can use his second chance

10 April 2018

Najib Razak's reputation took a slap with the 1MDB scandal. Still, the prime minister is likely to win a fresh mandate in upcoming polls. That can help him secure a legacy as a reformer, if he handles China's influence adroitly and meets old pledges to cut the role of the state.

Uber races towards IPO with Southeast Asian deal

26 March 2018

The U.S. ride-hailing giant is exiting another cut-throat market. It will hand its regional business to Grab, a $6 bln local rival, and take 27.5 pct of the enlarged group. This is a sensible step to prepare Uber for public life – provided Grab can hold onto its leading position.

Malaysia throws cash into middle-income trap

9 November 2017

Najib Razak’s new budget lavishes cash on farmers, fishermen and rubber traders. But it is a transparent attempt to divert attention from the prime minister’s corruption woes without boosting competitiveness, narrowing inequality or helping Malaysia escape stagnation.

Anil Ambani’s telecoms empire is slipping away

3 October 2017

Now that a merger of its mobile unit has failed, the Indian tycoon is running out of options to keep control of his flagship Reliance Communications while reducing its $7 bln of debt. One creditor has already petitioned for insolvency. Others may soon run out of patience too.

Bunge makes itself slipperier target for Glencore

12 September 2017

The ag trader inked a $946 mln takeover of a majority stake in Malaysia’s IOI Loders Croklaan, expanding its business in higher-margin edible oils. The deal looks justifiable. But investors were hoping Ivan Glasenberg's conglomerate would hand them a juicy takeover bid.

Malaysia power IPO will test 1MDB stain

19 July 2017

China Nuclear wants to float assets acquired for $2.3 bln from disgraced 1MDB. A Kuala Lumpur listing may smooth local misgivings over Chinese ownership. But it is unclear if investors are ready to look beyond the fund scandal. Recent listings also suggest it will be a hard sell.

Lotte’s Malaysia IPO has bad chemical reaction

4 July 2017

The South Korean conglomerate is raising $877 mln through a cut-down IPO of its petrochemical unit. It still ranks as Malaysia's biggest listing since the 1MDB crisis. But a chunky valuation discount to peers suggests toxic air around the issuer and destination is yet to clear.

Dumb and Dumber 1MDB money trail is one to cherish

16 June 2017

Cash from the Malaysian fund ended up in a yacht, art, and rights to the film “Dumb and Dumber To”, the DOJ claims. The charges are incredible. But authorities are unlikely to recoup much. And alas, the days of U.S. crusades against global financial crime look numbered.

Felda joins list of Malaysia’s money headaches

7 June 2017

The palm oil giant has suspended its chief after auditors raised a red flag. There are echoes of the 1MDB scandal: Felda is state-backed and investors have been burnt in a listing pushed by Prime Minister Najib Razak. It adds to the noise as Malaysia heads towards a key election.

Politics align for Malaysia bank merger

1 June 2017

Efforts to squish together the country's banks have repeatedly failed. Now RHB could buy AmBank, creating a $9 bln group. After the 1MDB fund scandal, big shareholders may be keener to do a deal. A rising oil price helps too. The trick will be to keep the structure simple.

Geely grabs a new growth engine on the cheap

24 May 2017

The Chinese carmaker is set to buy 49.9 pct of Proton. Reversing the Malaysian marque’s long decline won’t be easy, especially as a back-seat driver. But it is unlikely to cost much upfront. The Volvo owner’s latest bit of bargain-hunting could help it rev up in Southeast Asia.

Malaysia makes room for better 1MDB property deal

4 May 2017

A $1.7 bln deal to sell a prime Kuala Lumpur development project to a Malaysian-Chinese consortium has lapsed. The two sides disagree about what went wrong. In any case, Malaysia could now do a deal that is better, politically and financially, as it seeks to fix the 1MDB mess.

Malaysia throws cheque book at 1MDB problem

27 April 2017

A deal with Abu Dhabi puts Malaysia on the hook for $3.5 bln of the disgraced fund's debt and leaves a dispute over a further $3.5 bln unresolved. That is a costly attempt to patch up relations between the states and avoid potential embarrassment before an election.

Fund-scandal fallout keeps Malaysia on its toes

23 January 2017

Prime Minister Najib Razak has more reason to worry about rising domestic costs from the 1MDB scandal than any half-baked investigations overseas. Falling approval ratings have taken the shine off his expected re-election bid, and investors have severely punished the ringgit.

Malaysia’s pivot to China is payback plus

3 November 2016

The country is not as desperate as the Philippines for investment. But cozying up to Beijing is one way to express gratitude for China's continued support during the 1MDB scandal. Outside funding can also help Najib meet ambitious development goals - and win re-election.

Asian investment banking is a money pit

20 September 2016

Fees from underwriting and deals are up 8 pct this year after a poor start. But only a few big foreign houses are profitable. Fierce competition, global and regional, keeps fees down. Meanwhile, big-ticket Chinese business goes to Chinese firms. It creates the conditions for more banks to retreat.

Malaysia fiasco undercuts Goldman’s standards push

21 July 2016

After the financial crisis, the Wall Street firm overhauled its business practices in an effort to avoid big reputational as well as financial risks. But its dealings with scandal-hit sovereign fund 1MDB, spelled out in new lawsuits, cast doubt on the depth of Goldman's changes.

Fat-tail US legal risk keeps Malaysian scandal hot

20 July 2016

The Justice Department has alleged over $3.5 bln was siphoned off from 1MDB. The legal details join the dots of the controversy, with plenty of colour. Everyone involved with the sovereign fund, from the Malaysian premier to Goldman Sachs, should feel uncomfortable.

Abu Dhabi fund merger papers over Malaysia problem

29 June 2016

State investor IPIC has sparked multiple controversies and is now locked in a dispute with Malaysia's 1MDB. Combining it with local peer Mubadala should lead to better governance. Creating a new $135 bln vehicle also helps the emirate scrub out the stain of past missteps.