Malaysia appears ready to welcome back the Bank of China (BOC) after an absence of 32 years. The bank was ordered to shut its four Malaysian branches in 1965 amid fears it could be used to fund the communist insurgency in the country at that time. The BOC is hot favourite to get the banking licence made available by the recent merger of United Overseas Bank's (UOB) two Malaysian units. UOB's chairman Wee Cho Yaw this week said authorities were considering granting the vacated licence to BOC, which has expressed a desire to return to Malaysia. A BOC spokesman in Beijing yesterday said he had not yet been told of any decision. Another spokesman in Hong Kong said aggressive recent expansion of the bank's overseas network was part of its strategy to grow into a truly global institution. He repeated an earlier statement by chairman Wang Xuebing that the bank would accelerate the pace of its expansion in the next two years, paying particular attention to Malaysia, Indonesia and the Philippines. The BOC completed establishment of a strategic presence in major financial centres in North America and Europe in the first half of this decade. It has been pushing for a Malaysian licence since the early 1990s after the country's government allowed its citizens to visit China. In 1994, Malaysia's Deputy Prime Minister and Finance Minister, Anwar Ibrahim, was reported to have agreed in principle during a state visit to China. Last year, he said Malaysia would pursue the matter actively if China would reciprocate by allowing Malaysian banks to open in China. Two leading banks, Malayan Banking and Public Bank, have been seeking permits to open branches in Beijing and Shanghai. BOC had hoped to win a Malaysian licence after the recent proposed merger of Singapore's OCBC Malaysian unit and Malaysian-listed Pacific Bank. When the merger was aborted, BOC's hopes were dashed. China is said to want a Malaysian licence badly with officials raising the issue repeatedly with Malaysian counterparts. Bilateral trade and direct investment between the two nations exceeded M$10 billion (about HK$30.7 billion) last year, compared to just M$1 billion in 1965.