Zico applies for Islamic digital bank licence in Malaysia

ZICO Holdings has put in an application for an Islamic digital bank licence from Bank Negara Malaysia, under a tie-up with Bursa-listed technology unicorn Green Packet and M24 Tawreeq.

The Catalist-listed professional service firm has entered into a head of agreement with Green Packet and M24 Tawreeq in relation to a proposed joint venture to apply for the digital bank licence in Malaysia.

Parties put in the application on June 30, and a response from Bank Negara is expected in the second quarter of 2022. But Zico cautioned that there is no certainty that the consortium will receive approval.

Zico has stated it will assess the potential impact of the new business on the group's existing business, including seeking a diversification mandate, if it obtains the licence and there is a need for the mandate.

But the company noted that the proposed functions it would play in the venture are within its ordinary course of business, in its response on Monday to the queries from the Singapore Exchange regarding the agreement with the two Malaysian counterparts.

Zico also stated that Green Packet is a Malaysian-based international technology-solutions company founded in Silicon Valley in the United States. It emerged as the first technology unicorn in Malaysia with a market capitalisation of US$1 billion.

M24 Tawreeq, previously AJWA Capital, is the first fully digital Islamic factoring finance company in Malaysia, registered with Malaysia's Ministry of Finance.

Zico shares closed unchanged at S$0.09 on Monday before it released its response.