The Star Online: Business
The Star Online: Business |
- EPF's investment income best ever at RM24.06bil
- Astro to increase prices
- Maybank and CIMB no longer pursuing RHB Cap
| EPF's investment income best ever at RM24.06bil Posted: 23 Jun 2011 03:57 PM PDT PETALING JAYA: The Employees Provident Fund (EPF) returned its best performance to date to post a gross investment income of RM24.06bil in its financial year ended Dec 31, 2010 reflecting a 39.8% year-on-year growth amid the impressive recovery of the Malaysian economy from the 2009 global economic recession, The growth had also led EPF to declare a dividend rate of 5.8% for 2010, up 15 basis points compared with the previous year. The EPF also recorded its highest ever dividend payout amount of RM21.61bil, an increase of 11.55% over the 2009 dividend payout of RM19.37bil. "Financially, we leveraged on the recovery in the markets to garner our highest gross income to date, while operationally, we further built upon the strong foundations laid to enhance operational efficiencies, deliver on key performance targets and elevate the customer service experience," said EPF chairman Tan Sri Samsudin Osman in a statement yesterday. The EPF's Annual Report 2010 was tabled in Parliament yesterday. The retirement fund maintained its prudent strategy and devoted the majority of its investments in 2010 to fixed income assets with 32.38% invested in loans and bonds, 26.9% in Malaysia Government Securities and 5.45% in money market instruments. Equities emerged as the single-largest asset class comprising about one third or 34.85% of total assets, while 0.42% was invested in properties. The year also saw the EPF total investment assets crossing the RM400bil mark to stand at RM440.52bil as at Dec 31, 2010. |
| Posted: 23 Jun 2011 05:06 PM PDT COME July, you will be paying new rates for your entertainment, brought to you by Astro. If you ask Astro, it won't mince its words. The new pricing is effective July and the hikes range from RM1 to RM15 a month. That works out to an additional RM180 a year or 49 sen more a day for the package that has gone up by RM15 a month. Astro will make about RM17.7mil a month from the total price hike and for a year, this would total RM212mil. If you ask Astro, it will be quick to point out that some users will benefit from the price adjustment its first since 2007 anything from RM4 to RM14.95 per month. The good thing about this new pricing is that the basic package of RM37.95 is left untouched, and Astro says the new structure is such that the more channels you order, the lower the rate will be. Astro has come up with three super-value packages two priced at RM125 (tailored for Malay and Indian viewers) each and RM155 for the Chinese. If you want all 146 channels, it will cost RM199, down from RM274.75, but this group makes up only about 3% of Astro's total subscriber base of 2.95 million. Astro b.yond, the high-definition (HD) offering, is now part of the super-value bundle and that means you need not to fork out RM20 extra every month. On hindsight, the idea of charging RM20 a month for Astro b.yond was ridiculous as Astro shouldn't have passed its cost of going HD to the consumers. That should not have been imposed at all. The unfortunate part of the new pricing is that Astro was only thinking of its three main groups of viewers Malays, which make up 1.7 million of its subscriber base, Chinese (600,000) and Indians (300,000) when it drafted the super-value deals. It did not factor in those who just like to watch English language programmes, and that is grossly unfair. The announcement on the hike came on June 7 and the charging will begin on July 11. The rationale for the hike is that content cost has gone up, with a compounded annual growth rate of 14% from 2008 to 2012. Astro's content bill stood at RM762mil in 2008, RM1.17bil in the financial year ended January 31, 2011, and will rise to RM1.2bil in the current financial year. Content makes up 35% of its overall cost. Although many think sports is the main culprit, sucking up all the content cost, it actually use up only a third, just like local and international contents. After the announcement, Astro has been talking to its customers and so far, about 50,000 have opted for the super-value deals. Some of Astro's subscribers are aware of the hikes. Some think it is unfair to raise prices at a time when electricity cost has gone up and so has petrol price. In fact, the increase in petrol price has resulted in costlier foodstuff. Some users have aired their grouses via social networks while consumer groups have spoken against the hike as they questioned the rationale for Astro being a monopoly service provider. Others are asking for a review of the new price structure or else a boycott will be staged. The matter has reached Parliament, where questions have been raised and answers given. The irony of it all is the Government is saying that "it is still discussing with Astro over its plan to adjust the pricing of its packages ... will need to know whether it is appropriate or reasonable for the company to increase its fees ... the new package price effective July 11 is not final". But if you ask Astro, it would say the new pricing will be reflected in your July bill. Going by the Communications and Multimedia Act 1998, under which Astro operates, Astro says it can set its own pricing, and that it had revealed the new rate to the regulator on May 13. A monopoly in satellite TV it is. However, there are others, nine to be exact, that have similar licences, some of which have not fully exploited their licences. Those that have gone into the game have yet to come up with a compelling alternative. That is why Astro is able to dominate. It is also sitting on content, some exclusivities which others cannot touch, and the company can say that it is the seller's world. Let us be reminded that Ofcom, the independent regulator and competition authority in the United Kingdom, has the will to dictate its market in many areas, from pricing to keeping players on their toes so that consumers are well protected. In the spirit of competitive pricing, should the regulator have more say in the pricing charged on consumers and should we be burdened so soon after the recent electricity hike? |
| Maybank and CIMB no longer pursuing RHB Cap Posted: 23 Jun 2011 05:01 PM PDT PETALING JAYA: The grand deal that would have created a regional banking champion has fallen flat even before it could take off. Barely a month after they expressed their interest to take over RHB Capital Bhd, both Malayan Banking Bhd (Maybank) and CIMB Group Holdings Bhd announced yesterday that they were no longer pursuing merger talks with the country's fifth largest bank. Maybank announced to Bursa Malaysia that its board had decided not to pursue the possible merger "in light of recent developments and following further deliberations" at this juncture. Similarly, CIMB Group also said it had ceased negotiations with RHB on a potential merger exercise. "Based on our various discussions and our assessment of the present expectations of key stakeholders, we do not believe that we will be able to arrive at a value-creating merger," CIMB Group chief executive Datuk Seri Nazir Razak said in a statement. "Merger negotiations are both resource consuming and distracting for staff and stakeholders. Therefore, we prefer not to prolong our discussions unnecessarily, allowing all parties to return to business as usual' as soon as possible," he added. Even so, sources have not ruled out a possible merger between these parties "not too far into the future." RHB Capital's share price, which has been on an uptrend since the announcement of the takeover bid, suffered a major beating yesterday, shedding 6% of its value, or 57 sen, to close the day at RM9.03 on news that the merger talks had fallen through. RHB Cap's largest shareholder is the Employees Provident Fund (EPF), which owns a 45% interest in the banking group. It's "business as usual for us," EPF chairman Tan Sri Azlan Zainol told StarBiz. Azlan, who is also RHB Bank Bhd chairman, said: "We will continue to serve our customers and pursue our strategic direction and initiatives. The group has performed well over the years and will continue to achieve higher level of profitability as a stand-alone entity." According to sources, the talks for the potential merger started heading south very early this week. The main stumbling blocks were pricing and divergent interests. "It was clear that the talks were not going to have a good ending. If there was not going to be a positive outcome, it would be better to stop it as soon as possible. The situation was getting too complicated. That could be why the two banks decided to walk away," said a source. The breakdown in talks closely followed the sale of Abu Dhabi Commercial Bhd's (ADCB) 25% stake exactly a week ago to its sister company, Aabar Investments PJSC, at RM10.80 per share. It is believed that Bank Negara had last week set a condition that ADCB's sale price of the block should be adjusted accordingly if the offer price for the merger was lower than RM10.80, which was not received well by parties espousing free market forces. The price tag of RM10.80, which works out to 2.25 times the book value of RHB Cap, had inadvertently set a floor or indicative price for the takeover bids by Maybank and CIMB, which the suitors were evidently not willing to pay. Even so, industry observers had pointed out that the transaction between ADCB and Aabar was not an arm's length deal as they were related parties and should not have set the benchmark pricing for the takeover exercise. Evidently, not everyone had agreed with that assessment. An advisor to Aabar said the sovereign-owned investment agency would proceed as signed to acquire the 25% stake in RHB Cap as it "believes in the long-term value proposition with EPF as a long-term partner and would support any proposal that enhances shareholder value whether it is organic growth, mergers and acquisitions or a combination." "Aabar has transacted the purchase on a willing buyer-willing seller basis after thorough analysis and believes RHB Cap is a good investment in the long term," he added. Analysts were not surprised by the outcome as most had expected a "walkout" largely due to the wide gap in price expectations. One analyst said the sharp fall in RHB Cap's share price yesterday was an "expected knee-jerk reaction as it has risen significantly on the takeover talks." "Investors were definitely looking forward to CIMB buying RHB Cap because it (CIMB) was well integrated with other financial institutions previously. An integration would have reaped real operational benefits for RHB Cap. Now that this is not happening, it's a great disappointment," said the analyst. |
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