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SYDNEY (March 1): Australia and New Zealand Banking Group (ANZ) said on Monday it will write off the value of its investment in AMMB Holdings Bhd (AmBank) after the Malaysian bank settled a claim linked to the massive financial scandal at the fund state. 1Malaysia Development Bhd (1MDB).
Australia’s fourth-largest lender will take an A $ 212 million (US $ 163.41 million) cut in the book value of its 24% stake in AmBank that will reduce its semi-annual earnings result for fiscal 2021, it said in a statement to the stock market.
The write-off is the result of AmBank’s agreement with the Malaysian government over its role in the alleged theft of $ 4.5 billion of Malaysian state funds.
It will reduce ANZ’s first-half earnings, which will be released in May, but will not affect its overall capital position because it already owns 100% of the capital compared to its stake in AmBank, the bank said in a statement.
AmBank will pay the Malaysian government $ 700 million to settle claims in connection with its role in the scandal in which $ 4.5 billion was allegedly stolen from 1MDB, a state fund created by former Prime Minister Datuk Seri Najib Razak, said the last Friday.
Najib was convicted of corruption and money laundering last year for transferring millions of dollars linked to a 1MDB unit to his AmBank accounts between 2014 and 2015. He denies wrongdoing and has filed an appeal.
ANZ, which has tried unsuccessfully to sell its stake in AmBank in the past, said the book value of its stake will drop to A $ 850 million from A $ 1.05 billion.
ANZ shares rose 1.22% Monday morning, underperforming slightly than the broader market, which was up 1.53%. (US $ 1 = 1.2974 Australian dollars)
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AmBank RM2.83b Deal Linked To 1MDB Likely To Drive Stock Price Down, Analysts Say
AMMB securities trading halted until the end of tomorrow pending announcement
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