Maybank Proposes Dividend Reinvestment Plan

Maybank is proposing to undertake a recurrent and optional dividend reinvestment plan that allows shareholders of Maybank to reinvest their dividend into new ordinary shares of RM1.00 each in Maybank.

In a filing to Bursa Malaysia, the company said the proposed dividend reinvestment plan is part of its efforts to enhance and maximise shareholders' value via the subscription of new Maybank shares where the issue price of a new Maybank share shall be at a discount of not more than 10 per cent to five-day volume weighted average market price.

It said the proposed plan will provide the shareholders with greater flexibility in meeting their investment objectives, as they would have the choice of receiving cash or reinvesting in the company through subscription of additional Maybank shares without having to incur material transaction or other related costs.

The company will also benefit from the participation by shareholders in the proposed dividend reinvestment plan to the extent that if the shareholders elect to reinvest the electable portion into new Maybank shares, the cash which would otherwise be payable by way of dividend will be retained to fund the continuing growth and expansion of Maybank and its subsidiaries.

The retention of cash and the issue of Maybank shares under the proposed plan will not only enlarge the company's share capital base and strengthen its capital position, but will also add liquidity of Maybank shares on the Main Market of Bursa Malaysia.

The proposed dividend reinvestment plan is expected to be put in place by the second quarter of 2010.

RBS: Buy ringgit against won, yen

The bank recommends entering a three-month forward contract to sell the won at 339.36 per ringgit and the yen at 26.74 per ringgit

SINGAPORE: Investors should buy the ringgit against South Korea's won and Japan's yen as Malaysia's central bank may increase its policy rate as many as two more times in 2010, the Royal Bank of Scotland Group plc said.

Bank Negara Malaysia will continue reining in monetary stimulus after last week's rate increase, while government pressure will mean that the Korean and the Japanese central banks won't increase borrowing costs anytime soon, RBS, the fourth-largest currency trader, wrote in a research note published on Tuesday.

Malaysia's central bank will next review its policy on May 13.

"Bank Negara could do a few more rate hikes," RBS strategist Chia Woon Khien said in an interview in Singapore yesterday. "The question is whether they want to go straight to neutral level or stay a little dovish along the way."

Malaysia's central bank raised its benchmark overnight rate by 25 basis points to 2.25 per cent on March 4. The RBS report said there is "scope for at least one, if not two more, 25-basis point hikes" in the coming year. Prime Minister Datuk Seri Najib Razak said last week that Southeast Asia's third-largest economy may expand 6 per cent this year, twice the pace of the official forecast, on a rebound in exports.

The ringgit has risen 2.6 per cent this year against the dollar, the best performer among Asia's most active currencies excluding the yen. It climbed 0.6 per cent to 3.3230 at 12.10pm in Kuala Lumpur, the strongest level since August 2008.

The bank recommended entering a three-month forward contract to sell the won at 339.36 per ringgit, targeting the spot rate to reach 355 when the bet expires on June 9. RBS also suggested a similar forward bet at 26.74 yen per ringgit, predicting the spot rate at 28 upon the contract's maturity.

Will Malaysia rate rise set off SE Asia hikes?

Analysts say Malaysia’s regional neighbours will focus on domestic factors to determine when to raise interest rates

Central banks in Southeast Asia are set to stick to their current monetary policy course rather than change tack after Malaysia last week surprised markets by raising interest rates.

The Malaysian central bank increased its rate to 2.25 per cent from a record low of 2 per cent, arguing the move would help avoid the risk of economic imbalances later on.

Analysts say Malaysia’s regional neighbours will focus on domestic factors to determine when to raise interest rates for the first time following the global economic crisis.

Thailand’s central bank left its policy rate unchanged on Wednesday, saying Malaysia was one factor among many for policymakers to consider. The Philippines central bank meets on Thursday and is expected to leave rates steady as well.

Malaysia last week became the first central bank in Asia outside Australia to increase rates as part of efforts to unwind crisis measures.

ANALYST VIEWS

(The comments were made before Thailand’s rate decision)

DAVID COHEN, ECONOMIST, ACTION ECONOMICS IN SINGAPORE:

“I don’t think that they will be prompted to tighten in meetings this week in Thailand, or Philippines. It’s certainly got their attention, the fact that people in the market are talking about it. Maybe it helped to test the waters for these folks and I think it’s consistent with the mainstream expectation that sometime in mid-year, they will tighten rates.

They can start using the same rationale as Malaysia’s central bank governor - the normalisation after an extended period of accommodative rates.”

PRAKRITI SOFAT, REGIONAL ECONOMIST, BARCLAYS IN SINGAPORE “No, I think each country has its own set of factors that are driving what they will do. Indonesia may begin its tightening cycle in late Q2, we see 100 basis points for the year but risks are biased to later and lesser. But based on BNM (Malaysia) they won’t be changing their rate outlook.”

FREDERIC NEUMANN, REGIONAL ECONOMIST, HSBC IN HONG KONG: “For the Philippines, I doubt it (Malaysia’s action) has had any major impact, in part because economic data has been far softer in Philippines compared to Thailand and Malaysia.

For that reason, no imminent move by the BSP (Philippines) and the BSP might even hold through the second quarter. There is some tinkering at the edges to remove the emergency measures put in place, but that has to be distinguished from outright rate hike as seen in Malaysia.”

NUCHJARIN PANARODE, ECONOMIST, CAPITAL NOMURA IN THAILAND: “Our house has already expected other central banks in the region to start raising rates in the second quarter as rates are too low, not because of Malaysia’s rate rise. But that may increase the likelihood of rate hikes elsewhere.”

VISHNU VARATHAN, ECONOMIST, FORECAST PTE IN SINGAPORE:
“On the radar now is India. If you’re talking of countries that probably need to normalise, we have a whole list of them.

But given the mix of inflation data as well as growth pick up , conditions are appropriate and most pressing in India. China is also not too far off.”

USARA WILAIPICH, ECONOMIST, STANDARD CHARTERED IN THAILAND: “The impact is limited given implementation by central banks in any country will more depend on specific local factors, mainly on speed of economic recovery, inflation pressures, and any evidence of asset price bubbles.”

Khazanah said placing out 7.7pc of MAHB

MALAYSIA'S state fund Khazanah Nasional Bhd is placing out 7.7 per cent of Malaysia Airports Holdings Bhd (MAHB), sources familiar with the matter said yesterday.

This follows a similar exercise in September last year when it sold a 5 per cent stake in the airport operator as part of its programme to reduce its holdings in government-linked firms.

The new placement of 85 million shares, via a bookbuilding process, is aimed at raising as much as RM400 million, according to a term sheet obtained by Reuters yesterday.

Prior to the current placement, Khazanah had a 67.7 per cent stake in MAHB.

CIMB and JPMorgan are joint bookrunners in the placement exercise, the term sheet showed.

The state fund in December sold 2 per cent of key power utility Tenaga Nasional in a bid to woo foreign funds back into Malaysia's stock market.

MAHB shares closed at RM4.90 yesterday.

KL bourse set to test 1,308-point level

It is critical that the benchmark index (FBM KLCI) surpasses the 1,308 level, as it will reflect confidence in the market and economy, says a research head

The Malaysian stock market is expected to continue on the uptrend this week, helped by growing confidence in the domestic economy and in the case of banking stocks, by last week's decision by Bank Negara Malaysia to raise interest rates slightly.

Analysts said the benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index may breach the year's high of 1,308 level.

"I think the market is set for a strong rebound and it will test the 1,308-mark," said Jupiter Securities head of research Pong Teng Siew.

He added that

"The GDP (gross domestic product) figures announced recently signal that Malaysia's growth is strong," he said.

The benchmark index reached the high of this year at 1,308.36 on January 21.

Analysts also believe that banking stocks are likely to continue to rise, backed by the recent interest rate increase which will translate into higher interest margins for banks.

The market ended sharply higher last Friday with the FBM KLCI rising 15.69 points, or over 1 per cent, to 1,299.78, its highest level in seven weeks. Banking stocks were the best performers.

Public Bank Bhd aims to match dividend payout

Public Bank Bhd (1295) aims to keep paying half of its net profit as dividend this year despite concerns that stricter global rules may require banks to keep more shareholders money in future.

"Our cash payout ratio last year was about 57 per cent. We are looking to try and maintain that level, at around 50 per cent," chief operating officer Leong Kwok Nyem told reporters after its annual shareholders' meeting in Kuala Lumpur yesterday.

He added that the dividend plan is subject to Bank Negara Malaysia's approval and any new developments in the Basel 3 framework, which is still under discussions globally.

The new global rules may require banks to hold more shareholders fund.

Still, the total dividend payout may be lower this year in terms of percentage, as it also gave out treasury shares in the past two years.
The country's third largest lender last year paid a gross cash dividend of 55 sen per share, and a share dividend that equals to 22.2 sen based on its share price at the end of the year. This brought the total dividend payout to 79.3 per cent of its net profit in 2009.

The bank, which distributed 146 million treasury shares in the past two years, is left with 29 million treasury shares. It could return this to shareholders this year to boost dividend, but the number is quite small, Leong said.

"We will look at the appropriate level of dividends for the current year," he said.

Leong said the bank has no plans to raise new capital this year, saying that it is premature to prepare for stricter capital rules under Basel 3, which is still in the early stages of discussion.

Banks are only required to provide feedback to the Basel committee by April this year and there will be further rounds of consultation by the committee before the next draft of the proposal is expected by the year-end. The new rules will not come into effect until end-2012.

Hong Leong Bank: Buy, target price RM9.50

The target price was derived with the assumptions of a 16 per cent sustainable return on equity, 4 per cent long-term growth, and 9.4 per cent cost of equity.

"Our view on Hong Leong Bank is independent of whether it successfully acquires EON Capital Bhd," HwangDBS wrote in a report yesterday after Hong Leong announced its results for the second quarter ended on December 31 2009.

The stockbroker believes that the growth potential could speed up at Bank of Chengdu in China, which is a 20 per cent associate of Hong Leong.

Hong Leong recently entered into a joint venture (49 per cent stake) with the Chinese bank to operate a licensed finance company in China.
"The venture could add to contribution from its Chinese operations. Its maiden venture in Vietnam has also commenced operations and is expected to contribute positively in two to three years," HwangDBS noted.

Genting Posts Pre-Tax Profit Of RM2.528 Billion

Genting Bhd Thursday announced that pre-tax profit for its financial year ended Dec 31, 2009, increased to RM2.528 billion from RM1.735 billion in the previous year.

Revenue, however, fell to RM8.894 billion from RM9.082 billion, mainly due to a decrease in revenue from the plantation division, the company said in a statement.

Total revenue from Genting Malaysia Bhd's Resorts World Genting was affected by the weaker luck factor in the premium players business although the overall business volume was higher, it said.

Although revenue from the UK casinos declined as a result of lower business volume and lower win percentage arising from poor luck factor and further exacerbated by the weakening of the pound against the ringgit, there was an improvement in profit, due largely to stringent cost control and significantly lower operating overheads, the company said.

Meanwhile, Genting Malaysia announced its pre-tax profit for the year ended Dec 31, 2009, increased to RM1.764 billion from RM1.127 billion in the previous year and revenue rose to RM4.992 billion from RM4.887 billion.

Palm oil rises on talk of India, China demand

CPO FUTURES

PALM oil gained yesterday on speculation that demand for the edible oil may remain strong in India and China, the world’s biggest users.

May-delivery palm oil futures advanced 0.2 per cent to RM2,635 a metric ton on the Malaysia Derivatives Exchange.

“Demand growth should remain strong given the projected gross domestic product growth of around 8-10 per cent for China and India,” CIMB Group Sdn Bhd said in a report yesterday.

Palm oil also gained as soybeans, crushed to make soybean oil, advanced for a second day.

May-delivery soybeans traded in Chicago advanced 0.2 per cent to US$9.71 a bushel at 6.49 pm in Singapore. May-delivery soybean oil was unchanged at 39.3 cents a pound at 6.46 pm.

In China, September-delivery palm oil rose 1.2 per cent to settle at 7,016 yuan (US$1,028) a ton on the Dalian Commodity Exchange, extending Monday’s 2.3 per cent jump. Soybeans rose 1.4 per cent to 3,874 yuan, after climbing 1.1 per cent on Monday.

Indonesia, the second-largest palm oil producer, may keep the export tax for March unchanged at 3 per cent, Sahat Sinaga, second deputy chairman of the nation’s palm oil board, said.

Palm oil, the cheapest cooking oil, is also used as an alternative fuel additive and tends to track crude oil prices. It surged 52 per cent last year as crude oil jumped 78 per cent.

Crude oil in New York for March delivery climbed to more than US$80 a barrel for a third day in Asian trading and was last at US$79.62 a barrel at 6.52 pm Singapore time.


RUBBER

MALAYSIAN rubber prices ended higher yesterday amid a quiet market despite weaker prices on the Tokyo Commodity Exchange.

The higher prices were due to concern over a tight supply condition, dealers said.

Many tappers have stopped tapping due to wintering, which is characterised by reduced yield owing to dry weather.

A dealer said the market was quiet due to lack of participants as more traders were still on the Lunar New year holiday mood.

At noon, the Malaysian Rubber Board's physical price for SMR 20 rose 4.5 sen to 1,046.5 sen per kg while latex in bulk edged up 5 sen to 734 sen per kg.

The unofficial sellers' closing price for tyre-grade SMR 20 decreased 1 sen to 1,045.5 sen per kg and latex in bulk added 0.5 sen to 734 sen per kg.


TIN

THE tin price on the Kuala Lumpur Tin Market (KLTM) rose by US$33 to close at US$16,933 per tonne yesterday amid expectations of strong demand from China, following the week-long Lunar New Year break and an improving economic outlook, dealers said.

The dealer said the KLTM also gained support in tandem with the overnight uptrend in the tin price on the London Metal Exchange (LME), which ended US$175 higher at US$17,175 per tonne.

"The tin markets received strong interest in anticipation of a better economic performance this year," added the dealer.

On the KLTM, overall turnover was flat at 50 tonnes.

Bids accounted for 50 tonnes compared with offers of 40 tonnes with European, Japanese and local traders continuing to dominate trade.

The price differential between the KLTM and the LME declined to a premium of US$95 per tonne from US$235 per tonne on Monday. - Agencies

Zeti: Malaysia clearly on track to economic recovery

MALAYSIA is on the path to economic recovery, Bank Negara Malaysia's (BNM) governor says, ahead of unveiling economic data for the fourth quarter of 2009 tomorrow.

"We are already clearly on the path to recovery. The indicators are that the economic performance is better than expected," Tan Sri Zeti Akhtar Aziz said.

Fourth-quarter data tomorrow will show if Malaysia managed to emerge from its first recession in a decade.

Zeti also reiterated that any adjustment in interest rates would be to achieve a "normalisation" and not a tightening of policy. "Monetary policy will continue to be supportive of the economic recovery process," she said.

Policymakers' next meeting is on March 4. BNM has kept the Overnight Policy Rate low at 2 per cent for seven straight meetings.

Economists expect Malaysia to return to positive growth in the final quarter, after three straight quarters of negative growth.

AmResearch's senior economist Manokaran Mottain recently upgraded his fourth-quarter economic growth to 3.5 per cent from 1.5 per cent.

"We are no longer in extraordinary circumstances. We have come out of that kind of environment," Zeti said after launching Thomson Reuters' new Islamic finance product in Kuala Lumpur yesterday.

The product, known as the Islamic Finance Gateway, is a global platform and directory comprising details and links to Islamic finance professionals, rating agencies, industry standards bodies, index providers and scholars, among other things.

It is available on its flagship Thomson Reuters 3000 Xtra desktop.

"The timely access to a broad range of key information on Islamic finance - including on the product terms, structures and Syariah rulings - will contribute to enhanced transparency in the Islamic financial markets," Zeti said of the product.

PPB may not be able to announce Q4 results on time

PLANTATION and property group PPB Group Bhd's (4065) fourth quarter results announcement will be delayed, as it waits for 18.4 per cent owned Singapore-based Wilmar International Ltd to announce its results.

On February 12, Wilmar told the Singapore Exchange it will announce its full-year results on March 1. No reason was given for the delay.

According to Bursa Malaysia Bhd's listing requirements, PPB is required to furnish its quarterly report for the fourth quarter ended December 31 2009 to the regulator by February 25.

The group however, told Bursa Malaysia yesterday, it will not be able to meet the timeline, due to Wilmar's material contribution to PPB's financial results.
PPB targets to release its fourth quarterly report to Bursa Malaysia on March 2, the day after Wilmar's announcement to the Singapore Exchange.

Should the group fail to announce its results by March 8, trading of its shares will be suspended.

IOI Corp Outlook Remains Encouraging

KUALA LUMPUR, Feb 11 (Bernama) -- IOI Corporation Bhd's outlook is expected to remain encouraging on the back of better crude palm oil prices, which averaged RM2,526 in the beginning of 2010, said Kenanga Research.

It said it expected a slight drop of 0.9 per cent in revenue and a drop of 0.5 per cent in net profit for the company in the current financial year.

In a research note released Thursday, Kenanga Research also forecast a trimming of 2.1 per cent in revenue for the 2011 financial year and a decline of 3.5 per cent in net profit as a result of coverage changes.

IOI Corp's pre-tax profit for the second quarter ended Dec 31, 2009 rose to RM598.241 million from RM333.495 million in the same quarter of 2008.

IOI in an announcement to Bursa Malaysia had said the increase was due to higher profit contribution from the property and manufacturing segments and unrealised translation gain on US dollar-denominated borrowings.

Its revenue, however, declined to RM3.06 billion from RM3.727 billion previously.

Meanwhile, MIDF Equity Beat said CPO prices will remain firm this year and next year, with average prices to be at RM2,450 per metric tonne and RM2,650 per metric tonne respectively.

"We expect CPO prices to remain firm in the first quarter of 2010 but may be coming under pressure as the South American soybean harvest begin in the second quarter," it added.

Meanwhile, ECM Libra Investment Research said it expected softer yields and hence profits in the third quarter of this year due to the seasonal production down cycle.

It said this will be despite the stronger CPO prices so far.

"Malaysian Palm Oil Board statistics just for January have indicated that production declined some 11 per cent and this should be reflected in the group's (IOI) numbers," it said.

"We will continue to see stagnant growth into 2010 as the group has minimal major maturities coming on-stream," it said.

Export Of Palm Oil Products Reached RM49.6 Billion Last Year

BANGI, Feb 11 (Bernama) -- The income from the export of palm oil products last year reached RM49.6 billion following an increase in the production of the commodity.

The Deputy Minister of Plantation Industries and Commodities Datuk Hamzah Zainudin said the increase in production also contributed to the total export of palm oil products of 15.87 million tonnes.

"The strategic approach being implemented by the government in the area of research and development, has succeeded in yielding a new innovation which has had an impact on enhancing the prestige of the palm oil industry," he added.

He said this in his closing speech at a ceremony to present certificates to 47 participants of a Plantation Machine Operators Course (KOML) for the September 2009 session here Thursday.

His speech was read by the Director General of the Malaysian Palm Oil Board (MPOB), Datuk Dr Mohd Basri Wahid.

It was reported earlier that the export of palm oil products is expected to exceed RM100 billion in 2020 following initiatives to effectively enhance production.

In 2008, the export of palm oil products was worth RM65.2 billion.

Hamzah said the encouraging achievement of the country's oil palm industry is also attributed to the progress in research and quality control undertaken by the MPOB.

He said to date, MPOB's research has resulted in more than 440 technology encompassing the upstream sector and production of downstream products which have been accepted and endorsed by the industry.

He also stated that the area under palm oil cultivation has also increased by 4.5 per cent.

This he added, enabled the total area under oil palm cultivation, to reach 4.69 million hectares last year.

Commenting on the KOML, Hamzah said the involvement of local youths in the plantation sector would reduce the dependance on foreign labour which is estimated to reach 300,000.

"The dependence on foreign workers in the plantation sector does not benefit the country as there is an outflow of money overseas and also causes social problems," he explained.

Hamzah said the KOML is being implemented to produce local workers skilled in the operation of agricultural machinery to fullfil the needs of the oil palm industry and this is very important.

He also highlighted that the plantation sector and the cultivation of oil palm had moved to modern, efficient methods, including the use of agricultural machinery.

Maybank Expects OPR To Rise 50 To 70 Basis Points

Maybank expects the overnight policy rate (OPR) to increase between 50 and 70 basis points this year in line with signs of an improving economy, its president and chief executive officer, Datuk Seri Abdul Wahid Omar said.

He said the bank also expected gross domestic product (GDP) to grow 4.5 per cent this year and inflation to be at 2.3 per cent.

Abdul Wahid said this at a press conference here Tuesday after announcing Maybank's interim results for the half-year financial period ended Dec 31, 2009.

Last month, it was reported that Bank Negara Malaysia had decided to leave the OPR unchanged at a record low of two per cent for the seventh consecutive time amid uncertainty over the prospects of advanced economies.

In a statement issued after the first Monetary Policy Committee (MPC) meeting for this year on Jan 21, the central bank had said the growth in advanced economies would continue to depend on policy stimulus measures and the sustainability of private sector demand amid ongoing financial system resolution and reforms.

It had also said that the growth momentum in regional economies was expected to strengthen further this year, while domestic economic indicators had suggested a favourable economic expansion in the fourth quarter of 2009.

"Positive developments in manufacturing production, financing activity, external trade and labour market conditions reaffirms the assessment that the economic recovery is gaining strength," Bank Negara had said.

Maybank's H1 Pre-Tax Profit Up 38.8 Per Cent To RM2.55 Billion

Malayan Banking Bhd's (Maybank) pre-tax profit for the first half year ended Dec 31, 2009 rose 38.8 per cent to RM2.556 billion from RM1.842 billion in the previous corresponding period.

Its revenue increased by 35.5 per cent to RM6.408 billion from RM4.729 billion in the same period last year, while net profit rose by 43.5 per cent to RM1.875 billion from RM1.306 previously.

Maybank president and chief executive officer, Datuk Seri Abdul Wahid Omar, said the robust performance was achieved on the back of a significantly improved results across all business sectors.

He said this when announcing Maybank group's interim results for the half year ended Dec 31, 2009 here Tuesday.

Investors seen locking in profits ahead of festival

Malaysian investors are likely to remain cautious in the week running up to the Lunar New Year, after Asian equity markets fell late last week following overnight losses on Wall Street.

Analysts expect investors to continue locking in their profits this week, while volumes will ease due to the cautious sentiment.

Kenanga Investment Bank Bhd research head Yeonzon Yeow said that small/mid-cap stocks were likely to outperform the rest of the stock market, after the substantial sell-down in big-caps.

Analysts also expect global market volatility to continue as investors appear uncertain whether world growth can support the equities market, given the release of bearish economic data last week.

On the home front, stocks that will continue to draw interest this week include Scomi Marine Bhd and KNM Group Bhd. The two companies made major announcements last week.

Scomi Marine said late last Friday that it was selling its entire 29.07 per cent stake in the Singapore-listed CH Offshore Ltd for close to RM350 million.Giving away 8,888 Free Cards! Get your Tune-In Card now!


The disposal will result in net gain of RM63.6 million after accounting for estimated expenses of RM3.4 million.

The stock, which will resume trading today, last traded at 47.5 sen on Thursday.

Meanwhile, KNM gained 6.5 sen to 81.5 sen on Friday, after its founder and other investors said they planned to take the company private.

The Malaysian stock market benchmark was on an uptrend at the start of last week, but began a downward slide on Thursday as weakness on Wall Street weighed on sentiment.

The FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) fell 17.13 points to end at 1,247.9 points on Friday, in line with weak Asian equity markets that took their cue from Wall Street, which fell after news of a rise in US unemployment benefits.

Markets were also affected by concern over the European sovereign debt problems.

However, a late rally on Wall Street last Friday saw US stocks ending slightly higher after a volatile week.

The Dow Jones Industrial Average erased its intra-day losses by ending 10.05 points higher at 10,012.23. The Standard & Poor's 500 Index was 0.29 per cent up at 1,066.19, while the Nasdaq Composite Index was 0.74 per cent higher at 2,141.12.

While the FBM KLCI may slide to 1,220 points, analysts expect the index to find its support level at 1,200 points.

FDI set for moderate recovery this year

INVESTMENTS in Malaysia's manufacturing sector halved last year, bitten by the global recession, but foreign direct investment (FDI) is expected to recover moderately this year.

This is because the economies of its foreign investors are set to improve. The International Monetary Fund, for instance, has raised its global economic growth forecast to 3.9 per cent for this year from 3.1 per cent.

The government approved manufacturing investments worth RM32.6 billion last year, down from RM62.8 billion in 2008.

Out of the 766 projects approved by the Malaysian Industrial Development Authority (Mida), foreign investments made up 67.8 per cent, or RM22.1 billion.

"Foreign investments in projects with investments of RM1 billion and above accounted for 37.3 per cent of the total (investments approved), indicating FDI inflows into the country were mainly for quality investments," International Trade and Industry Minister Datuk Seri Mustapa Mohamed said at the investment agency's annual media conference in Putrajaya yesterday.

FDI was mainly in industries manufacturing chemicals and chemical products, non-metallic mineral products, and electronics and electrical products.

In 2008, before the global economic crisis, the country attracted RM46.1 billion of investments

"(The year) 2009 has been tough for all of us. But we also see a better balance between foreign and domestic investments," Mustapa said.

Domestic investments amounted to RM10.5 billion, or a third of the total approved. They were mainly in industries making basic metal products, chemicals and chemical products, are among countries with RHD markets.

BYD's gas-powered cars, F0 and F3, are China's top sellers.

The Chinese manufacturer of batteries and cars aims to become the market leader in new energy vehicles (EV).

Its EV model, F3DM, operates as a plug-in hybrid vehicle, while the soon-to-be-launched e6 will be the first pure-electric vehicle.

The e6 will be launched in China in the first quarter, and in the US by year-end.

Berjaya Group holds 51 per cent of Changan Berjaya Auto Sdn Bhd, a joint venture with China's ChangAn Auto Co Ltd, to distribute Changan Era cars here.

The group also owns distribution rights for brands such as Mazda, Skoda and Mercedes-Benz.

Berjaya Group also plans to assemble Mazda 3 cars in Malaysia soon.

Lee, others in RM3.6b bid for KNM business

KNM Group Bhd (7164) says its founder and other investors have offered to buy all of its business, valuing the process equipment maker at RM3.6 billion.

The group has received a proposal from BlueFire Capital Group Ltd, which is controlled by Lee Swee Eng, to buy all of its business and undertakings for 90 sen per share.

Lee is the group managing director and major shareholder, with 23.4 per cent of KNM as at May 18 last year.

The offer is 20 per cent more than KNM's share price of 75 sen at yesterday's close.

KNM told Bursa Malaysia that BlueFire was working with GS Capital Partners VI Fund LP and Mettiz Capital Ltd and the international adviser was Goldman Sachs (Singapore) Pte Ltd.
GS Capital is a US$20.3 billion (RM69 billion) global investment fund set up by Goldman in 2007.

KNM's board has granted BlueFire a limited exclusivity period up to March 22 to complete due diligence.

KNM said it will engage its legal and financial advisers to assist the company and its board to evaluate and negotiate the definitive terms of any transaction. KNM's current order book stands at RM2.2 billion. It is bidding for contracts valued at RM14 billion.

KNM Group stock jumps on buyout bid

KNM Group Bhd, a Malaysian oil and gas services provider, rose the most in almost seven months after a Goldman Sachs Group Inc. private equity fund joined the founder of KNM in a takeover bid that values the Malaysian oil and gas services provider at about $1 billion.

The stock surged 10 per cent to 82.5 sen at 9:05 a.m. local time in Kuala Lumpur, set for the steepest gain since July 15.

Founder and Managing Director Lee Swee Eng offers to buy out company at 0.90 ringgit per share, valuing the process equipment maker at RM3.6 billion.

Lee now owns 23.64 per cent of KNM.

“We believe the valuation is fair and a premium relative to the sectors FY10F PE of 8.8 times, as it reflects control premium of the M&A in Malaysia,” said HwangDBS Research in a note on Friday. - Bloomberg, Reuters

Interest Rates Stable In December 2009, Says Bank Negara

The daily weighted average overnight interbank rate moved within a narrow range of 1.99 to 2.00 per cent during the Dec 1, 2009, to Jan 27, 2010, period.

Interbank rates of other maturities were also relatively stable, said Bank Negara Malaysia in its Monetary and Financial Developments for December 2009 report released Thursday.

The central bank said the average fixed deposit rates of commercial banks were unchanged between December and January.

As at Jan 15, the average quoted fixed deposit rates for tenures between one and 12 months were within the range of 2.00 and 2.50 per cent, Bank Negara said.

In terms of the commercial banks' lending rates, the average base lending rate (BLR) was unchanged at 5.51 per cent as at Jan 15 while the average lending rate (ALR) trended lower to 4.83 per cent as at end-December compared with 4.91 per cent in November and 4.85 per cent in October, it said.

Bank Negara said the ringgit depreciated by 1.0 per cent against the US dollar from Dec 1 to Jan 27 but it appreciated against the euro by 6.0 per cent, the Japanese yen by 1.9 per cent and the pound sterling by 1.8 per cent.

The euro depreciated against most currencies due to concerns over sovereign-credit issues in Greece, the central bank said.

Against regional currencies, the ringgit appreciated against the Singapore dollar by 0.5 per cent but it depreciated against other regional currencies by between 1.0 and 1.8 per cent.