KUALA LUMPUR (April 2): CIMB Group Holdings Bhd plans to sell non-core assets to ensure the financial services entity is well capitalised as it focuses on income growth, group chief executive Tengku Datuk Seri Zafrul Aziz said.

The Edge Malaysia business and investment weekly (Edge Weekly) in its latest April 4 to 10 issue, quoted Zafrul as saying CIMB's non-core asset divestment formed a part of the group's Target 2018 (T18) business plan.
 
“I think now is a test for all of us to see how we address these concerns. We were lucky because we started the T18 initiative at the right time. We are looking at selling off non-core — this will free up some capital.

"Last year also was a tough year because the whole restructuring cost was about close to RM718 million, so that eats into capital. And provisions also eat into capital. So, we need to make sure that it’s a one-off. This year, the restructuring cost won’t be that high,” he said, adding that when markets were tough, one had to make tough decisions.

Zafrul said this is an interview with Edge Weekly. His comments followed CIMB's announcement on the group's planned divestment of its 51% stake in PT CIMB Sun Life for IDR550 billion (about MYR169 million).

CIMB Sun Life is an Indonesian life insurance company. In a statement last month, CIMB said it was selling the stake to Sun Life Assurance Company of Canada to optimise CIMB's resources.

At Bursa Malaysia yesterday (April 1), CIMB shares fell eight sen or 1.6% to close at RM4.77 for a market capitalisation of RM40.68 billion. The stock saw some 15 million shares traded.

CIMB shares had risen 5.1% this year, outperforming the FBM KLCI's 1.1% gain.

For a better understanding on CIMB under Zafrul's stewarship, kindly pick up and read the latest Edge Weekly issue.

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