KUALA LUMPUR (April 22): Affin Bank Bhd (KL:AFFIN) said it has completed its acquisition of Pheim Asset Management Sdn Bhd (Pheim AM) for RM50 million in cash, in a move aimed at strengthening its wealth management capabilities and boosting fee-based income.
The bank said the completion, following all required regulatory approvals, marks a strategic step in its ambition to position itself as a universal banking group while expanding its investment offerings and diversifying income streams.
Affin Group president and group CEO Datuk Wan Razly Abdullah said the acquisition strengthens the group’s wealth management platform and enhances its ability to deliver more integrated and scalable offerings.
“As the bank continues to expand its presence in fee-based income and investment solutions, this enhances our ability to deliver more integrated and scalable offerings to our customers,” he said.
Established in 1993, Pheim AM is principally involved in asset management, with its subsidiaries offering Islamic asset management and unit trust services. As at March 31, the group managed RM832.8 million in assets under management and advisory, serving institutional, corporate and retail clients.
Wan Razly said the integration of Pheim AM, which has a track record of more than 32 years, will support the group’s ability to offer bespoke portfolio management solutions and broaden its client reach. “Our focus is on ensuring a seamless integration that preserves client continuity, aligns capabilities and delivers sustained value to our customers, employees and stakeholders,” he said.
Following the acquisition, Pheim AM will operate as a wholly-owned subsidiary of Affin, enhancing the group’s ability to deliver a broader suite of banking, investment and wealth management solutions while strengthening its distribution capabilities.
The RM50 million purchase price implies a price-to-AUM ratio of 6%, higher than the 3.08% valuation in Affin’s 2022 sale of Affin Hwang Asset Management to CVC Capital Partners.
Affin exited the asset management industry in July 2022 when it sold its 63% stake in Affin Hwang Asset Management for RM1.42 billion.
Analysts estimate that every RM1 billion in AUM could generate RM2 million to RM2.5 million in fee income.
Meanwhile, Affin also announced on Wednesday the retirement of independent non-executive chairman Datuk Agil Natt. A seasoned banker and former deputy president/executive director of Malayan Banking Bhd, Agil was appointed chairman in November 2019.
Within the industry, he is widely regarded as having been brought in to help clean up Affin’s books and steer the lender back into shape at a time when it was grappling with legacy asset quality issues.
Shares in Affin Bank closed down 2 sen, or 0.8%, at RM2.43 on Wednesday, giving the bank a market capitalisation of RM6.16 billion. The stock has fallen 4.9% over the past year.