Malaysia's Affin cleared to start talks on Bank Muamalat stake

KUALA LUMPUR Thu Aug 16, 2012 8:18am EDT

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KUALA LUMPUR Aug 16 (Reuters) - Malaysia's second-smallest bank Affin Holdings Bhd has obtained central bank approval to start negotiations on buying a stake in DRB-Hicom Bhd's 70 percent-owned Bank Muamalat Malaysia Bhd , according to stock exchange filings on Thursday.

The potential deal follows the completion of DRB-Hicom's purchase of a 70 percent stake in Bank Muamalat on Oct. 22, 2008, after which it was required by the central bank to trim its stake to 40 percent.

Affin said the negotiations are to be completed on or before the end of this year.

The announcement also comes a day after DRB-Hicom said it received expression of interest from certain parties to buy a stake in its insurance businesses. (Reporting by Yantoultra Ngui; Editing by David Holmes)

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