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September 13, 2005
Improvidence
Finding it increasingly tough to make ends meet? Here's something to cheer you up:
On paper, [EPF's] roughly RM2.3 billion investment in listed Rashid Hussain Bhd is currently valued at about RM115 million , according to people familiar with the matter, making the investment one of the worst in the EPF's history. [Wall Street Journal: Another chill hits Malaysian business climate; subscription required]
See, there's this tussle between the Government and Utama Banking Group, the largest shareholder of Rashid Hussain Bhd, which in turn is the ultimate holding company of RHB Bank Bhd.
There are various twist and turns [read the Wall Street Journal story], but basically what you wanna know - in addition to the fact that your money looks set to go down the drain - is that more of your money could follow suit:
At the crux of the affair is the dire financial health of RHB Bank's ultimate holding company, Rashid Hussain Bhd, in which Utama and the EPF own 32.8% and 31.7% stakes, respectively. Malaysian bankers say the Rashid Hussain group of companies urgently needs at least RM3 billion of fresh capital from its main shareholders to meet government capital-adequacy requirements.The problem: The EPF would have to pour more of public funds into an already disastrous investment in order to bail out the group.
It looks like the Government wants the Sarawakians out of RHB Bank and wants someone else to take control:
RHB Bank is an attractive prize, with RM84 billion in assets and a 200-branch network.
Whoever the prizewinner is, one thing's for sure: You and I are the losers.
Posted by aisehman at September 13, 2005 12:54 AM
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» More bad news about your EPF savings? from Brand New Malaysian
Some of you might have read this piece in StarBiz about the Employees Provident Fund (EPF) strengthening their position in RHB and an EXCO formed... [Read More]
Tracked on September 14, 2005 06:47 AM
Comments
Yes we are the losers and we always have been. Remember TimeDotCom? Remember how the shares were forced down our throats? All this is the ruling party's fault. And there are numerous other examples of how our money is plundered again and again. Even Petronas money is not spared. I hope this tragedy is not happening again under the Abdullah Adminstration.
Posted by: John at September 13, 2005 01:22 PM
I know of people who kept their precious shares from D & C Bank days. Through the many takeovers and corporate exercises, their fortunes have come to naught. Poor fellas...
Posted by: bayi at September 13, 2005 09:38 PM
Any economist who is more well verse in investment would like to give their comments on this?
I believe that I might not be the right person to comment and so are the many other who commented for don’t talk abt multi-billion dollar investment, I don’t think I can even manage my own money well as I am still looking forward and still counting the days to my next paycheck. In another words, in a financial blunder.
So who am I to talk about money. Then it would be like talking to a Math teacher about Biology. In fact, when we talk abt investment, I think there is no such things as a "SURE UNTUNG" kinda thing coz nobody can forsee the future.
Posted by: JL at September 23, 2005 12:29 AM