Malayan Banking Berhad's (KLSE:MAYBANK) top owners are sovereign wealth funds with 44% stake, while 32% is held by institutions

editorial-team@simplywallst.com (Simply Wall St)

Sat, Oct 14, 2023, 7:10 PM 4 min read

If you want to know who really controls Malayan Banking Berhad (KLSE:MAYBANK), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are sovereign wealth funds with 44% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Meanwhile, institutions make up 32% of the company’s shareholders. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies.

In the chart below, we zoom in on the different ownership groups of Malayan Banking Berhad.

See our latest analysis for Malayan Banking Berhad

ownership-breakdown — KLSE:MAYBANK Ownership Breakdown October 15th 2023

What Does The Institutional Ownership Tell Us About Malayan Banking Berhad?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Malayan Banking Berhad already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Malayan Banking Berhad's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth — KLSE:MAYBANK Earnings and Revenue Growth October 15th 2023

Hedge funds don't have many shares in Malayan Banking Berhad. Permodalan Nasional Berhad is currently the largest shareholder, with 44% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 13% and 5.0%, of the shares outstanding, respectively.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 58% stake.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Malayan Banking Berhad

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our most recent data indicates that insiders own less than 1% of Malayan Banking Berhad. As it is a large company, we'd only expect insiders to own a small percentage of it. But it's worth noting that they own RM31m worth of shares. In this sort of situation, it can be more interesting to see if those insiders have been buying or selling.

General Public Ownership

With a 23% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Malayan Banking Berhad. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Malayan Banking Berhad better, we need to consider many other factors. Take risks for example - Malayan Banking Berhad has 1 warning sign we think you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.