Malaysia's Southern Bank said it would end three months of merger talks with investment giant CIMB after it failed to make a formal price offer.

Southern Bank (SBB) "has unanimously decided to discontinue negotiations with CIMB Group Sdn Bhd (CIMBG) regarding a potential merger of the businesses of SBB with that of CIMBG," it said in a statement to the Malaysian bourse yesterday.

"The Board is of the view that further prolonged discussions would not be in the best interests of SBB and its shareholders and other stakeholders, including its customers."

No more discussions

It added that it would inform the central bank that it "intends to no longer proceed with merger discussions with CIMBG."

However it added that "a merger with another banking institution could be value creating for shareholders at this stage in the Malaysian banking industry evolution."

CIMB in October announced it had obtained approval from the central bank to begin discussions for the possible merger.