This article first appeared in The Edge Financial Daily on January 19, 2018

KUALA LUMPUR: CIMB Securities International Pte Ltd (CSI) will be renamed CGS-CIMB Securities following completion of the disposal of CIMB’s 50% stake in CSI to China Galaxy Securities Co Ltd (CGS).

CIMB continues to hold the remaining 50% shares in CSI, which is the holding company of CIMB’s ex-Malaysia stockbroking business comprising institutional and retail brokerage and equities research in Indonesia, Singapore, Thailand, Hong Kong, South Korea, India, the UK and the US.

In a statement yesterday, CIMB said the inclusion of CIMB’s Malaysia stockbroking business in the joint venture (JV) is targeted to be completed by the first half of 2018 (1H18).

It added that the name change to CSI will be effected once regulatory approvals are obtained.

On June 6 last year, CIMB signed a deal with the Chinese firm to sell a 50% stake in CSI for S$167 million (RM494.3 million).

“The transaction would improve CIMB’s cost-to-income ratio by over 100 basis points (bps) and [the] Core Equity Tier 1 ratio by around 10bps,” said CIMB.

It noted that the JV marks the first foray by a Chinese stockbroker into Southeast Asia.

“The stockbroking JV will benefit from CIMB’s established network and footprint in Southeast Asia, and CGS’s technological know-how, wide client base, as well as deep presence in and access to the Chinese market. CIMB and CGS also see this JV as the first step to facilitate greater investment and capital flows between their respective markets,” CIMB said.

“This move also reflects CIMB’s proactive pivot in response to the changing landscape of the stockbroking industry. With superior solutions and greater market access, I am confident that the JV will be successful in delivering better value to our existing and future clients,” CIMB group chief executive officer Tengku Datuk Seri Zafrul Tengku Abdul Aziz said.