The Bank of Nova Scotia stands in Toronto, Ontario, Canada, on Tuesday, Feb. 5, 2013.Reynard Li/Bloomberg
Bank of Nova Scotia is in talks to sell its business in Malaysia, where the bank has operated since 1973, to Cathay Pacific Holdings Ltd.
Scotiabank has entered exclusive negotiations to sell 100 per cent of its subsidiary, Bank of Nova Scotia Berhad, with two of Taiwan-based Cathay's own subsidiaries, Cathay United Bank and Cathay Life Insurance.
The proposed sale, which was disclosed in a filing with the Taiwan Stock Exchange, is still subject to due diligence and approvals from Malaysian and Taiwanese regulators, and the window of exclusivity expires on April 30.
At the end of 2016, Scotiabank valued its Malaysian subsidiary, which is based in Kuala Lumpur, at $311-million.
"We are evolving our business in the Asia-Pacific region with a focus on serving cross-regional clients in priority sectors and core markets," said Debra Chan, a Scotiabank spokesperson, in an e-mailed statement. "As a result, a decision was made to enter into discussions with the goal of finding the right buyer for our franchise in Malaysia."
Scotiabank has been in Malaysia for 44 years, but has been scaling back its Asian businesses as it seeks to grow operations in four key Latin American markets: Mexico, Peru, Chile and Colombia. In its 2016 annual report, the company said that included closing representative offices in Vietnam and Thailand, and shuttering branches in Taiwan and Dubai.
Scotiabank CEO Brian Porter also said at an industry conference in January that the bank considers its 49-per-cent stake in Thailand's Thanachart Bank as "an investment," and not a "core" asset.
James Bradshaw