Banks at crossroads ahead of market liberalisation
Two years after a sweeping consolidation, Malaysian banks are again at a crossroads as they seek a new round of mergers to stay competitive ahead of market liberalisation, analysts said.
The industry has emerged on a stronger footing after a major upheaval following the 1997/98 Asian financial crisis, which led 54 banks and finance houses to be merged into 10 "anchor" groups under the aegis of the government.
But a big gulf still separates the small and big banks among the 10 groups and analysts say a further overhaul to create fewer but stronger players is inevitable to cope with competition when the sector is liberalised in 2007.
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