KUALA LUMPUR - Hwang-DBS (M) Bhd, which has completed the sale of its investment banking business to Affin Holdings Bhd for RM1.36 billion (S$528 million), plans to return RM2.50 a share to its shareholders as special dividend.
The ex-date for the special payout is April 21, while the entitlement date was set for April 23, the company said in its filings with Bursa Malaysia yesterday.
Hwang-DBS shares rose 5 sen to close at RM4.05.
Meanwhile, Affin sees immediate boost from the acquisition that catapulted its stockbroking business into second position and asset management, fifth.
Deputy chairman Tan Sri Lodin Wok Kamaruddin said at a media briefing yesterday that Affin planned to expand and unlock the value from the merger, adding that the new wealth management business was likely to be launched next year as management would be focusing on the merger for the rest of the year.
"We will be fully integrated by September or October this year," he said.
The new business, which will be named "Affin-Hwang", is to be anchored around Affin's investment advisory business as part of the bank's plan to be a top five investment bank in each if its business segments - institutional stock broking, retail equities, asset management, investment banking and treasury.
"The investment bank's end-to-end value proposition will be strengthened as it will be able to capitalise on the synergy that can be created by the enlarged platform of the merged businesses," he said.
Affin will spend up to RM54 million in one-off integration costs in the next 12-18 months to complete the integration. Those funds will go into IT infrastructure and systems setup, rebounding exercise and integration advisory support.
He added that cross-selling and top line synergies from the merger would bring about additional profit before tax totalling RM84 million in the first three years (2015-2017) and RM43 million per annum thereafter.
"RM43 million is a sustainable amount, assuming there are no further synergy enhancement costs," Affin Investment Bank managing director Maimoonah Hussain said.
Maimoonah dismissed rumours of an "exodus" by HwangIB due to cultural and operational changes, pointing out that remisiers were bound by a three-year contract to the company as of last year.
"It is not a concern for now as there won't be an exodus," she said.
On a separate note, Affin's interest in acquiring a 24 per cent stake in Indonesian Bank Panin Syariah will only come to a conclusion after the Indonesian elections.
"Once the Indonesian government is confirmed, we'll have a better grasp of the country's direction. At the moment, we're solely focusing on this bank, which has been approved by the central bank, as it is very similar to Affin," Affin chief executive officer Datuk Zulkiflee Abbas Abdul Hamid said.
As at Dec 31, 2013, the group's unaudited paid-up capital stood at RM1.5 billion, while the group shareholders' funds was at RM6.4 billion.