IT now seems that not only minority shareholders are shaken – and negatively impacted – by news of the global settlement in relation to AmBank’s involvement in the 1Malaysian Development Bhd (1MDB) scandal on February 26.
Equally concerned with the disposal of large quantities of AMMB Holdings Bhd shares by seven of its key management personnel late last year which can be construed as an act of insider trading is the Institutional Investors Council Malaysia (IIC).
“With this in mind, I have initiated for engagement under the IIC umbrella to seek clarifications and explanation on the issues of concern from the board and management of AMMB,” IIC adviser Lya Rahman told FocusM.
“This engagement is also part of the main activities undertaken by IIC in line with its strategic priorities to have a dialogue on the oversight of strategy, performance, governance, sustainability, risk management and relations with stakeholders.”
According to Lya, the IIC’s membership is made up of 24 institutional investors and 35 signatories comprising asset owners and asset management companies in Malaysia.
“My comments on the issues surrounding AMMB which have raised many eyebrows have always meant to be constructive in nature,” she caveated. “No accusation, negative or malice intended. However, those responsible must be taken to task with no stone to be left unturned.”
According to Bursa Malaysia filing, the seven key AMMB personnel – including its group chief internal auditor and group chief risk officer – have altogether disposed a total of 447,950 shares at a price ranging from RM3.63 to RM3.66 between Dec 29 and 30 last year:
The prominent institutional investors in AMMB include the Employees Provident Fund (10.7% equity stake as of March 17), Permodalan Nasional Bhd (8.53%) and Kumpulan Wang Persaraan (2.12%).
In an earlier interview, Lya told FocusM that to ascertain for sure if an act of insider trading has indeed been committed as alleged, the Securities Commission (SC) needs to get to the root of the matter.
“If it is not insider trading, what is the motivation factor that moved the seven key personnel in AMMB to dispose their shares?” she asked.
The allegation of insider trading aside, Lya is also taken aback by news that AMMB has to pay RM2.83 bil – dubbed “mother of all fines” – as global settlement in relation to its involvement in the 1Malaysia Development Bhd (1MDB) scandal.
Moving forward, Lya said there is lesson to be learnt from this fiasco with the AMMB board having to ensure that proper risk management and control as well as governance systems are in in place to prevent a repeat of the event in the future.
“Having well-crafted policies are not good enough … the board has to ensure that they are correctly and effectively implemented,” she added. – March 17, 2021
Photo credit:Nur Ismail Photography
