PRESS DIGEST - Malaysia - Sept 16

Following are the main stories in Malaysian newspapers. Reuters has not verified these stories and does not vouch for their accuracy.

ALL NEWSPAPERS

- De facto Law Minister Zaid Ibrahim tendered his resignation to Prime Minister Abdullah Ahmad Badawi on Monday but it was rejected.

THE STAR (www.thestar.com.my)

-- Prime Minister Abdullah Ahmad Badawi had a meeting with his deputy Najib Razak for more than four hours to discuss the country's present political situation, including the UMNO transition plan.

-- The government will ink an agreement with Telekom Malaysia Bhd (TM) (TLMM.KL) on Tuesday for the implementation of the 11.3 billion ringgit high speed broadband network, a job that was negotiated directly and not tendered out even though there were cheaper alternatives proposed by several parties, a senior official at TM said.

NEW STRAITS TIMES (www.nst.com.my)

-- There will be no change to the timetable for Najib Razak to take over as prime minister and UMNO president from Abdullah Ahmad Badawi in 2010.

BUSINESS TIMES

-- Indonesia's capital markets regulator has refused to relax rules for Malayan Banking Bhd (Maybank) MBBMKL>, putting its 8.8 billion ringgit deal to buy PT Bank Internasional Indonesia (BII) closer to collapse while a 480 million ringgit deposit risks being forfeited, Maybank said in a statement.

THE MALAYSIAN RESERVE (www.themalaysianreserve.com)

-- Bearish domestic and international sentiment sent the Kuala Lumpur Composite Index (KLCI) down by 12.4 points, or 1.19 percent, to 1,031.63 points on MOnday, analysts said.

THE EDGE FINANCIAL DAILY (www.theedgedaily.com)

-- Malayan Banking Bhd (Maybank) (MBBM.KL) is now highly likely to abandon its proposed 8.6 billion ringgit acquisition of PT Bank Internasional Indonesia (BII) after Bapepam, the Indonesian market regulator rejected its appeal to be exempted from a new regulation, Maybank said.

THE SUN (www.sun2surf.com)

-- UMNO Vice-President Muhyiddin Yassin says he will not resign from his post despite his recent remarks on the UMNO and national leadership transition plan.