KUCHING: Sarawak Bank Employees Union (SBEU) has called on Employees Provident Fund (EPF) to vote against the merger of CIMB Group, RHB Capital and Malaysia Building Society (MBSB).
Its general secretary Law Kiat Min, in a statement yesterday, said the call was contained in a resolution to be adopted at the union’s 18th Triennial Delegates Conference being held in Sri Aman since Thursday and to end today (Sept 20).
As EPF is a major shareholder of all three banks and would become a major shareholder of the merged bank, Law pointed out there is a high risk that EPF contributors’ money would be used to bail out the bank should it run into problems after the merger.
“The merger will reduce competition and make banking more expensive with less choice.
“It will pose huge risk to the financial system as such a big bank will be ‘too big to fall’ as seen in the global financial crises. Because failure of such a mega bank will be disastrous for the country and economy, the government and its shareholders will be forced to step in to rescue such banks.
“Experience has indicated that there is a clear danger that the bank management and top executives of mega banks, knowing that they have this ‘implied’ guarantee of bailout, will take higher risks for greater short term profits earning hefty bonus for themselves,” said Law.
Law also said SBEU is also concerned that a merger like this will mean thousands of jobs lost.
Meanwhile, more than 70 delegates and officials from all over Sarawak are attending the three-day TDC.
While in Sri Aman, the delegates spent some time at an orphanage, and a nearby longhouse as part of the union’s community service.
SBEU president Hadiah Leen and Law are among key officials who are returned unopposed to their post.
Andrew Lo continues on as chief executive officer.