The Malaysian bank CIMB signed on Thursday night a memorandum of agreement with the Royal Bank of Scotland (RBS) for the purchase of the RBS's Australian equity market operations. The operations cover 13 countries in the Asia-Pacific region including Australia, Japan and Korea.

With the buy-in, 200 of RBS's 600 employees would be shifted to CIMB which would benefit the bank workers who were at the risk of being unemployed after RBS Group Chief Executive Stephen Hester threatened to close the company.

Mr Hester said the closure was part of RBS's strategy to reduce its balance sheet after the bank was bailed out by the British government during the 2008 global financial crisis. British taxpayers now own 82 per cent of RBS.

However, except for 70 people, the remaining 400 workers in RBS Australia who are in non-equity operations, will be redeployed or declared redundant as part of the unit closures and relocation strategies.

The MOU defines the scope and terms of the sale and purchase agreement. CIMB did not disclose the value of the buy-in, but a Malaysia financial daily reported in February that the transaction is worth $50 million.

CIMB is the second largest bank in Malaysia with operations in 14 countries including top equities capital markets business in south east Asia. Its purchase of RBS Australian operations is seen as part of CIMB Chief Executive Nazir Razak's plans for the company to be a leading financial services firm in Asia.

Besides CIMB, the auction of RBS has attracted other financial companies such as the Bank of China and Mizuho Financial of Japan.

RBS is 12th in the Asia Pacific M&A league tables in 2011, excluding Japan, 18th in equity underwriting and 10th in Asian G3 Currency Bonds, excluding Japan and Australia.

The RBS parent company in Edinburgh reported last week net losses of almost €2 billion for 2011 due to its exposure to the Greek debt crisis, restructuring costs and compensation for insurance mis-selling.

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