Type	Announcement
Subject	MALAYAN BANKING BERHAD ("MAYBANK" OR "COMPANY") - Proposed Amendments To The Employees’ Share Option Scheme (“ESOS”) ("Proposed ESOS Revision"); And - Proposed Amendment To The Articles Of Association Pursuant To The Proposed ESOS Revision (“Proposed Amendment”) (Collectively to be referred as “Proposals")

Contents :

We refer to the announcement of the Company dated 1 August 2003 wherein Aseambankers Malaysia Berhad had, on behalf of the Company, announced that, inter-alia, the Company is proposing to establish an ESOS (“Previous Proposal”). The Previous Proposal was approved by the Securities Commission (“SC”) on 17 November 2003. Subsequently, the Company obtained the SC’s approval vide its letter dated 17 May 2004 for an extension of time until 31 December 2004 to implement the Previous Proposal. However, as at the date of this announcement, the Company has not implemented the Previous Proposal.

On behalf of the Company, AmMerchant Bank Berhad (“AmMerchant Bank”) would like to announce that the Company is now proposing to revise, inter-alia, certain terms of the Previous Proposal (“Revised ESOS”) to incorporate the recent changes to the SC’s Policies And Guidelines On Issue / Offer Of Securities (“SC Guidelines”) and the Listing Requirements of the Bursa Malaysia Securities Berhad (formerly known as Malaysia Securities Exchange Berhad) (“Bursa Malaysia”) with respect to ESOS.

2. DETAILS OF THE PROPOSALS

2.1 Proposed ESOS Revision

The Proposed ESOS Revision entails, inter-alia, the participation of non-executive Directors, and the increase in the maximum number of ordinary shares of RM1.00 each (“Shares”) in Maybank available for the Company’s ESOS from ten percent (10%) of the total number of the issued and paid-up capital to fifteen percent (15%).

In summary, the principal features of the Revised ESOS pursuant to the Proposed ESOS Revision are as follows :-

(i) the maximum number of new Shares which may be allotted pursuant to the exercise of the options under the Revised ESOS ("Options") shall be fifteen per cent (15%) of the total number of the issued and paid-up capital of the Company at any point of time during the existence of the Revised ESOS;

(ii) the employees eligible to participate in the Revised ESOS must be employed and on the payroll of Maybank and its subsidiaries (“Maybank Group”) for a continuous period of at least twenty four (24) months including service during the probation period and is confirmed in service;

(iii) the non-executive Directors eligible to participate in the Revised ESOS must have been a non-executive Director of the Maybank Group for a continuous period of at least twenty four (24) months;

(iv) the Revised ESOS shall be in force for a period of five (5) years from its commencement and no further Option will be granted thereafter unless the shareholders of Maybank in a general meeting agree to continue with the Revised ESOS for a further period of five (5) years with or without variations, and subject to the approvals of relevant authorities, provided that the duration of the Revised ESOS including any extension, if any, shall not exceed a total period of ten (10) years from its commencement;

(v) The new Shares to be allotted upon any exercise of the Option will upon allotment rank pari passu in all respects with the then existing Shares except that the new Shares so issued will not rank for any dividends or other distribution declared, made or paid to shareholders prior to the date of allotment of such new Shares and will be subject to all the provisions of the Articles of Association of Maybank relating to transfer, transmission and otherwise; and

(vi) the subscription price shall be at a discount, within the limit allowed by the relevant authorities from time to time and shall be decided by the ESOS Committee at its discretion, to the weighted average market price of the Maybank Shares as shown in the daily official list issued by Bursa Malaysia for the five (5) market days immediately preceding the date of offer but shall in no event be less than the par value of the Share, whichever is higher.

2.2 Proposed Amendment

Pursuant to the Proposed ESOS Revision, the Company is proposing to amend the Articles of Association of Maybank in order to accommodate the new Shares to be issued upon exercise of the Options and to facilitate the granting of Options to non-executive Directors.

3. RATIONALE FOR THE PROPOSALS

The rationale for the Proposed ESOS Revision is to incorporate recent changes in the SC Guidelines and the Listing Requirements of Bursa Malaysia with respect to ESOS.

4. EFFECTS OF THE PROPOSALS

4.1 Share Capital

The change in the issued and paid-up share capital of Maybank as a result of the Proposed ESOS Revision is set out in Table 1 of the Appendix to this announcement.

4.2 Net Tangible Assets ("NTA")

The Proposed ESOS Revision will not have any immediate effect on the NTA of the Maybank Group until such time when the Options granted pursuant to the Revised ESOS are exercised.

However, the NTA of the Maybank Group is expected to be enhanced depending on the number of new Shares to be issued upon exercise of the Options granted and the exercise price of the Options thereof.

4.3 Earnings

The Proposed ESOS Revision will not have any immediate effect on the earnings of the Maybank Group. Any potential effect on future earnings depend on the number and exercise price of the Options exercised at any point in time as well as the utilisation of proceeds arising therefrom.

4.4 Substantial Shareholders' Shareholdings

The Proposed ESOS Revision will not have any immediate effect on the substantial shareholders’ shareholdings in the Company until such time the Options are exercised.

4.5 Dividend

The Proposed ESOS Revision will not have any immediate effect on the dividend to be declared by the Company, if any.

The Proposed Amendment will have no effect on the share capital, NTA, earnings, substantial shareholders’ shareholdings and dividends to be declared of the Company, if any.

5. CONDITIONS OF THE PROPOSALS

5.1 Proposed ESOS Revision

The Proposed ESOS Revision is subject to the following approvals :-

a) Bursa Malaysia including the listing of and quotation for the new Shares to be issued pursuant to the Proposed ESOS Revision;

b) Bank Negara Malaysia; and

c) any other relevant authorities.

5.2 Proposed Amendment

The Proposed Amendment is subject to the following approvals :-

a) Bank Negara Malaysia; and

b) the shareholders of the Company at an Extraordinary General Meeting (“EGM”) to be convened.

The Revised ESOS is subject to the approval of the shareholders of the Company at an EGM to be convened.

The Revised ESOS is conditional upon the Proposed Amendment.

6. DIRECTORS' AND MAJOR SHAREHOLDERS' INTERESTS

6.1 Directors

All the Directors are deemed interested in the Proposed ESOS Revision by virtue of them being entitled to participate in the Revised ESOS.

Tunku Alizakri bin Raja Muhammad Alias (“Tunku Alizakri”), the son of Raja Tan Sri Muhammad Alias bin Raja Muhd. Ali, a Non-Executive Director of Maybank, is also an employee of Maybank. Accordingly, Tunku Alizakri is deemed a person connected with Raja Tan Sri Muhammad Alias bin Raja Muhd. Ali, and as such, Tunku Alizakri is deemed interested in the Proposed ESOS Revision by virtue of him being entitled to participate in the Revised ESOS.

Save as disclosed above, none of the persons connected with the Interested Directors have any interest, direct or indirect, in the Proposed ESOS Revision. 

6.2 Major Shareholders

None of the major shareholders and / or persons connected with them have any interest, direct or indirect, in the Proposed ESOS Revision.

7. ADVISER

AmMerchant Bank has been appointed to act as Adviser to Maybank for the Proposed ESOS Revision.

8. SUBMISSION TO THE AUTHORITIES

Submission of the application to the relevant authorities for the Proposed ESOS Revision will be made within one (1) month from the date of this announcement.

This announcement is dated 27 May 2004.

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Attachments

1. Table_1.doc (Size: 33,792 bytes)