May 10 2007
Malaysia’s biggest bank Maybank Bhd. said it has scrapped its recent rule that had required all law firms it does business with to be at least 50 percent owned by Malays, the country’s majority race, after it was strongly criticized by the public as discriminatory against ethic minorities. In a statement issued late Wednesday, the bank said it is revising its guideline “upon review of the issues and concerns raised by various parties.”
“Maybank would like to emphasize that the selection of solicitor firms would continue to be based primarily on performance, efficiency and merit … All solicitor firms, whether with Bumiputera or non-Bumiputera equity ownership, are eligible for consideration,” the statement said.
The controversy erupted after Maybank sent out letters to law firms last month pointing out that with effect from July 1, all legal firms doing business with the bank had to have at least three partners, one of which had to be Malay, and the Bumiputera partner or partners had to hold a minimum 50 percent stake in the firm.
The Malaysian Bar Council condemned the move as “totally discriminatory.” Council Chairman Ambiga Sreenevasan said, “There is no legal basis for such a condition and it’s certainly in breach of the spirit of the Federal Constitution. All our lawyers should be judged on merit.”
The Star newspaper reported Thursday that the Cabinet discussed the controversy in a weekly meeting on Wednesday and ordered Maybank to withdraw the policy. The meeting was chaired by Prime Minister Abdullah Ahmad Badawi, who is also finance minister.
The nearly four-decade-old policy aims to boost the number of Malay professionals and enhance Malay corporate ownership to at least 30 percent. To that end, there are higher quotas for Malays entering university and 60 percent of government contracts are awarded to Malays. The Malays also get special discounts in housing among other privileges.
Lately, there have been calls for the affirmative action policy to be scrapped. But the government insists that with the Malays comprising 60 percent of the country’s population but owning just 19 percent of its wealth, compared with 40 percent held by the ethnic Chinese who comprise less than 25 percent of the population, the policy is still needed.
Hey, what’s Central Bank (Bank Negara) stand on this issue? Doesn’t all the banks rules and regulations came from the Central Bank? Doesn’t Central Bank has the final say on such an important rules as it involves “national interest”? Isn’t this 50% thingy breaches and violate the 30% quota set by the government?
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May 10th, 2007 by financetwitter
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Comments
It is both illegal and unfair. You can’t get business from Maybank just because you aren’t Malay. There should be a boycott of Maybank because of this, personally I’m going to close my Maybank account within the next 4 months. Hope everyone else does the same, we as customers should not let such blatant racism pass.
It is both illegal and unfair. You can’t get business from Maybank just because you aren’t Malay. There should be a boycott of Maybank because of this, personally I’m going to close my Maybank account within the next 4 months. Hope everyone else does the same, we as customers should not let such blatant racism pass.