KUALA LUMPUR (Mar 9): CIMB Group Holdings Bhd, the country’s second largest lender by assets, expects growth proceeds raised through initial public offerings (IPOs) on the local bourse to remain flat this year.

“The IPO outlook depends on the market and the capital markets this year is going to be quite flat from what we have seen so far," its newly-appointed group chief executive Tengku Datuk Zafrul Abdul Aziz told reporters after a news conference to announce its sponsorship of Malaysia’s top woman golfer, 21-year-old Kelly Tan, today.

"(On CIMB's part,) we are going to continue monitoring the progress of the capital markets and we are quite cautious about it,” he said.

“The market is weak (so far this year), same like last year. Nothing has changed so far, but the market turns (around) very fast (and) so we wouldn’t know,” he added.

Last Thursday, the Securities Commission Malaysia (SC) forecast funds raised via IPOs on Bursa to more than double to RM13 billion this year, up from RM5.9 billion raised in 2014.

In 2014, Bursa welcomed 15 new listings across all sectors on the Main Market and ACE Market.

CIMB (fundamental: 1.05; valuation: 2.1) is in the midst of scaling back its investment bank operations, with plans to cut about 50 equities-related jobs in Asia as part of its Target 2018 (T18) plans to reduce operating costs.

On this, Tengku Zafrul dismissed suggestion that this will impact CIMB operationally, citing other banking groups as examples.

It was reported that Goldman Sachs Inc has cut back 30% of its investment banking team in Singapore, while the Royal Bank of Scotland Group Plc is planning to wind down it Asian corporate banking business within months.
 
“I do not know what the big deal (with the scaling back) is,” said Tengku Zafrul.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)