Maybank’s New Bumiputera Ruling

Malayan Banking Bhd (Maybank), the country’s largest banking group, introduced new regulations which would require law firms to have a minimum of three partners, of whom one must be Bumiputera with a minimum 50 per cent stake in the firm. The new regulations were supposed to take effect 1 July 2007, but may be changed pending a review of the said regulations following criticisms from various quarters, not least the Bar Council. Another bank, which has not been identified, has been reported as planning to introduce to same regulations.

A Maybank spokesperson said, “Efficiency and performance of solicitors as well as their ability to provide the best service to the bank and its customers have always been a core requirement for the emplacement of the bank’s panel of solicitors,” adding that equity ownership had never been the sole and overriding determinant for emplacement.

However, DAP National Chairman Lim Kit Siang has commented that the Maybank statement was ‘ambivalent’ and ‘unsatisfactory’, and interpreted the statement to mean two things:

• firstly, that existing legal firms which are already on the Maybank panel, and which had been given one year to comply with the new ruling, may now be exempted from the 50% bumiputra partnership ruling;

• secondly, that for all practical purposes, new legal firms will have to comply with the 50% bumiputra partnership ruling if they are to be emplaced on the bank’s panel.

Bar Council chairman Ambiga Sreenevasan described the requirement as “totally discriminatory”.

“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.

“That is the correct basis for selection,” she told the New Straits Times.

The Bar Council is perhaps one of the few entities in Malaysia which has been a devout adherent of meritocratic policies and direction, and is truly independent of meddling by undesired influences. As such, many observers would opine that its unabashed unwillingness to be beholden to a higher power would ultimately lead to its downfall; perhaps an irrational paranoia.

This latest move by Maybank and the other unnamed bank, however, offers no assistance to relief. As lovely and benevolent Maybank’s response sounds, it does not express any intention of backing down from the new rulings. And, if “equity ownership had never been the sole and overriding determinant for emplacement“, and that “efficiency and performance of solicitors… have always been a core requirement for the emplacement of the bank’s panel of solicitors“, it is possible to imply that Maybank feels that Bumiputera solicitors are more efficient and that they perform better in the course of their duties as a solicitor than non-Bumiputera solicitors. This racial implication could perhaps have been avoided if the bank did hold equity ownership as the sole and overriding determinant for emplacement. At least then it could be said that the bank had the vision of the NEP in mind: to distribute the wealth of the country equitably, by encouraging Bumiputera involvement in the management and running of law firms.

For now, however, the implications behind Maybank’s response has been lost on most.

Maybank Bhd, in the meantime, will review its decision. Failing that, the bank can look forward to the closure of the accounts of DAP Socialist Youth members, at least.