HONG KONG, Jan 21 (Reuters) - PT Bank Danamon Tbk (BDMN.JK), Indonesia's fifth-largest lender, has tapped investment banks Citigroup (C.N) and Morgan Stanley (MS.N) to help it raise several hundred million dollars in a rights offering, two people familiar with the matter said on Wednesday.
Danamon officials were not immediately available for comment. Citigroup and Morgan Stanley both declined to comment.
Wednesday, January 21, 2009
Indonesia's Bank Muamalat plans rights issue in H2
JAKARTA- Indonesian Islamic lender PT Bank Muamalat is planning a rights issue in the second half of 2009 to raise its capital adequacy ratio (CAR), the bank said on Monday.
The bank -- whose total assets rose 20 percent to 12.67 trillion rupiah ($1.14 billion) last year -- said it aims to increase its capital adequacy ratio to about 12 percent in 2009 from around 10.8 percent last year.
"The lower CAR is the consequence of our financing growth in 2008...Although the central bank regulates a minimum CAR level of 8 percent, the management considers a CAR level of 12 percent is needed to become a good bank," M. Hidayat, a director at the bank, told reporters.
The official said the rights issue could take place in the second half of the year, but did not give a value.
Muamalat, majority owned by Islamic Development Bank (IDB), recorded a 39 percent rise in its operating profit to 308 billion rupiah in 2008. It also aims to increase financing by 10 percent this year, compared to 22 percent financing growth in 2008.
Indonesia's first sharia bank said it would maintain 60-70 percent of its financing disbursement to small and medium enterprises (SMEs), citing their ability to weather the current global crises.
Under sharia or Islamic law, interest is banned and income must be derived from a fundamental economic transaction such as trade in goods and services, direct investment in a business, or renting out property.
The world's most populous Muslim country, however, has lagged behind neighbours Singapore and Malaysia in developing its Islamic finance industry. Around 85 percent of the population of 226 million people is Muslim.
The central bank said on its website (www.bi.go.id) its target for sharia banking was for total assets of 50 trillion rupiah and 87 trillion rupiah in 2008 and 2009 respectively. As of November, total assets for sharia banking stood at 47.2 trillion rupiah.
The bank -- whose total assets rose 20 percent to 12.67 trillion rupiah ($1.14 billion) last year -- said it aims to increase its capital adequacy ratio to about 12 percent in 2009 from around 10.8 percent last year.
"The lower CAR is the consequence of our financing growth in 2008...Although the central bank regulates a minimum CAR level of 8 percent, the management considers a CAR level of 12 percent is needed to become a good bank," M. Hidayat, a director at the bank, told reporters.
The official said the rights issue could take place in the second half of the year, but did not give a value.
Muamalat, majority owned by Islamic Development Bank (IDB), recorded a 39 percent rise in its operating profit to 308 billion rupiah in 2008. It also aims to increase financing by 10 percent this year, compared to 22 percent financing growth in 2008.
Indonesia's first sharia bank said it would maintain 60-70 percent of its financing disbursement to small and medium enterprises (SMEs), citing their ability to weather the current global crises.
Under sharia or Islamic law, interest is banned and income must be derived from a fundamental economic transaction such as trade in goods and services, direct investment in a business, or renting out property.
The world's most populous Muslim country, however, has lagged behind neighbours Singapore and Malaysia in developing its Islamic finance industry. Around 85 percent of the population of 226 million people is Muslim.
The central bank said on its website (www.bi.go.id) its target for sharia banking was for total assets of 50 trillion rupiah and 87 trillion rupiah in 2008 and 2009 respectively. As of November, total assets for sharia banking stood at 47.2 trillion rupiah.
NZ expands PT Panin Bank stake in A$166 million deal
ANZ has continued its Asian expansion by increasing its stake in PT Panin Bank, a major player in the Indonesian market.
It has acquired a further 8.4% of Panin in a deal worth $US114 million ($A166 million), bringing its total interest in the company to 38.3%.
ANZ chief executive officer Asia Pacific Alex Thursby says the increase in ANZ’s shareholding reflects ANZ’s commitment to the partnership with Panin and to growth in Indonesia.
“Indonesia is a key market in ANZ’s growth strategy in Asia and Panin is one of ANZ’s longest standing and largest strategic partnerships in the region,” Mr Thursby says.
“This increased shareholding recognises the strong position of Panin and the opportunities offered by a well-run bank with strong management and underlying fundamentals that supports its business plan.”
The shares in Panin were acquired by ANZ off-market from institutional investors.
ANZ has been a shareholder in Panin, Indonesia’s seventh biggest bank, since 1999, and the two companies also have a joint venture, PT ANZ Panin Bank, that dates back to 1993.
ANZ chief executive Mike Smith has emphasised the importance of expanding into Asia to increase the bank’s profits.
The bank has made a goal of being a “super regional” bank in Asia by 2012, with the region contributing 20% of the group’s earnings.
Last October ANZ announced it would be expanding its Vietnam operation, establishing a head office in Sun City in Hanoi and at least four branches and transaction offices in Hanoi and Ho Chi Minh City, with more to come this year.
News of the Panin deal has had little effect on ANZ’s share price, which has fallen 32c to $A14.76 amid fears the ongoing US banking crisis will have a flow-on effect on Australian banks’ profitability.
It has acquired a further 8.4% of Panin in a deal worth $US114 million ($A166 million), bringing its total interest in the company to 38.3%.
ANZ chief executive officer Asia Pacific Alex Thursby says the increase in ANZ’s shareholding reflects ANZ’s commitment to the partnership with Panin and to growth in Indonesia.
“Indonesia is a key market in ANZ’s growth strategy in Asia and Panin is one of ANZ’s longest standing and largest strategic partnerships in the region,” Mr Thursby says.
“This increased shareholding recognises the strong position of Panin and the opportunities offered by a well-run bank with strong management and underlying fundamentals that supports its business plan.”
The shares in Panin were acquired by ANZ off-market from institutional investors.
ANZ has been a shareholder in Panin, Indonesia’s seventh biggest bank, since 1999, and the two companies also have a joint venture, PT ANZ Panin Bank, that dates back to 1993.
ANZ chief executive Mike Smith has emphasised the importance of expanding into Asia to increase the bank’s profits.
The bank has made a goal of being a “super regional” bank in Asia by 2012, with the region contributing 20% of the group’s earnings.
Last October ANZ announced it would be expanding its Vietnam operation, establishing a head office in Sun City in Hanoi and at least four branches and transaction offices in Hanoi and Ho Chi Minh City, with more to come this year.
News of the Panin deal has had little effect on ANZ’s share price, which has fallen 32c to $A14.76 amid fears the ongoing US banking crisis will have a flow-on effect on Australian banks’ profitability.
SOERYADJAYA FAMILY TO TAKE OVER INDONESIAN BANK IFI
JAKARTA-
The family of William Soeryadjaya is taking 99 per cent of Indonesian PT Bank IFI, re-entering the banking sector after 16 years.
The family stopped business in the banking sector when its bank, Summa Bank, collapsed in 1992 when non-performing credits forced it to sell its stake in Indonesia's largest automotive company PT Astra International, which the family founded.
The family formed a consortium with the family of Sabar Ganda Sitorus, a business tycoon from North Sumatra to take over Bank IFI, Bank Indonesia deputy governor Siti CH. Fadjrijah said.
Bank IFI director Agus Suyanto said shareholders in the bank agreed to sell their stake and the acquisition was being processed.
Sabar Sitorus told that the agreement was signed two weeks ago but the price was still being negotiated.
The family of William Soeryadjaya is taking 99 per cent of Indonesian PT Bank IFI, re-entering the banking sector after 16 years.
The family stopped business in the banking sector when its bank, Summa Bank, collapsed in 1992 when non-performing credits forced it to sell its stake in Indonesia's largest automotive company PT Astra International, which the family founded.
The family formed a consortium with the family of Sabar Ganda Sitorus, a business tycoon from North Sumatra to take over Bank IFI, Bank Indonesia deputy governor Siti CH. Fadjrijah said.
Bank IFI director Agus Suyanto said shareholders in the bank agreed to sell their stake and the acquisition was being processed.
Sabar Sitorus told that the agreement was signed two weeks ago but the price was still being negotiated.
Saturday, January 10, 2009
Danamon: Indonesian Rupiah May Rise 7% on Slowing Imports
The currency will also strengthen as investors become more willing to take risk as the credit crisis wanes in 2009, Helmi Arman, an economist in
“Exports may contract, but imports could also shrink to a larger magnitude, thereby providing some cushion,” said Helmi, confirming the contents of a research report sent to clients yesterday. “The de-leveraging by global investors is not going to go on forever.”
PT Bank Danamon, which is controlled by
‘Not Groundless’
The rupiah reached a decade low of 13,150 in November as a global recession deterred investment in emerging-market assets.
Bank
“Such concerns are not groundless, but we think the accompanying fall in imports is likely to prevent the current account going deep into negative territory,” Helmi wrote in the report. “What we have in mind is a widening of the current- account surplus from 0.1 percent of GDP in 2008 to 1 percent of GDP in 2009.”
Friday, January 9, 2009
Indonesia Central Bank Cuts Rates, Sees Room to Ease Again
JAKARTA-
Indonesia's central bank slashed interest rates more than expected on Wednesday and said it may cut again to spur economic growth, just days after the government announced a US$ 6.6 billion fiscal stimulus package.
The half-point cut aims to soften the impact of the global crisis on Southeast Asia's biggest nation, where economic growth, prices, jobs and poverty will be among the key issues for voters in elections later this year.
Bank Indonesia cut its benchmark interest rate by 50 basis points to 8.75 percent, compared to a 25 basis point move predicted by economists in a Reuters poll.
"The risk from inflationary pressure is milder compared to the risk concerning economic activity, therefore the move needed to be effective and we decided to go ahead with a 50 basis point cut," Bank Indonesia Deputy Governor Hartadi Sarwono told a news conference.
"With regards to the possibility of lowering the BI rate further, there is still room. But it all depends on inflation and economic conditions," he said.
Inflation has fallen from a September peak of more than 12 percent to just above 11 percent in December and the government expects it to drop into single digits in mid-2009.
The central bank said economic growth this year would slow to between 4 and 5 percent from an estimated 6.2 percent in 2008.
That would still make Indonesia one of Asia's top performers, but economists say it needs to grow by 6 percent a year to absorb the many of its 226 million population who reach working age each year.
Economists said Wednesday's move that followed a quarter-point cut in December should support government efforts to prop up the economy and saw more cuts before the end of the first quarter.
"This will definitely help the government's planned stimulus package," said Gundy Cahyadi, an economist at IDEAglobal in Singapore.
CREAKING INFRASTRUCTURE
The stimulus, which includes plans to spend on roads, ports, airports and railroads, is intended to create jobs and reduce business costs due to the country's creaking infrastructure.
"The rate cut will provide a stimulus to the economy. But the key lies in the fiscal policy, as well," said Eric Sugandi of Standard Chartered Bank in Jakarta.
"As Indonesia's economy is mostly driven by domestic consumption, now it's up to how the government sustains the purchasing power of households."
The finance ministry welcomed the rate cut, saying it should support government bonds.
"We see the prices of government bonds in the last two days have been increasing. We are optimistic it will be better in the future," treasury director Rahmat Waluyanto said.
The ministry on Wednesday said it planned to sell retail sukuk, or Islamic, bonds next month, and a yen-denominated bond issue, possibly around the middle of the year.
Anggito Abimanyu, head of fiscal policy at the finance ministry, said the government aims to get approval for standby loans of about $5.5 billion in the first quarter.
The loans, from the World Bank, Asian Development Bank, and some donor countries, would be used if the government cannot meet its debt issuance target.
With the global economy rapidly losing steam and the world's top economies already in a recession, other central banks in Asia have also been slashing borrowing costs to support faltering growth.
The Reserve Bank of India cut its benchmark rate by 1 percentage point on Jan. 2, while the Bank of Korea is expected to follow suit with a half percentage point cut on Jan. 9.
Investors pulled out of emerging markets like Indonesia late last year, in response to the global financial crisis, leading to a sharp drop in Indonesian stocks, bonds and the currency, which hit a decade low near 13,000 per dollar.
Analysts said lingering concerns about the rupiah may limit the scope for further rate cuts, even though the currency gained after the rate decision to 10,700 to the dollar from 10,850, reflecting market optimism about the growth outlook.
Indonesia's central bank slashed interest rates more than expected on Wednesday and said it may cut again to spur economic growth, just days after the government announced a US$ 6.6 billion fiscal stimulus package.
The half-point cut aims to soften the impact of the global crisis on Southeast Asia's biggest nation, where economic growth, prices, jobs and poverty will be among the key issues for voters in elections later this year.
Bank Indonesia cut its benchmark interest rate by 50 basis points to 8.75 percent, compared to a 25 basis point move predicted by economists in a Reuters poll.
"The risk from inflationary pressure is milder compared to the risk concerning economic activity, therefore the move needed to be effective and we decided to go ahead with a 50 basis point cut," Bank Indonesia Deputy Governor Hartadi Sarwono told a news conference.
"With regards to the possibility of lowering the BI rate further, there is still room. But it all depends on inflation and economic conditions," he said.
Inflation has fallen from a September peak of more than 12 percent to just above 11 percent in December and the government expects it to drop into single digits in mid-2009.
The central bank said economic growth this year would slow to between 4 and 5 percent from an estimated 6.2 percent in 2008.
That would still make Indonesia one of Asia's top performers, but economists say it needs to grow by 6 percent a year to absorb the many of its 226 million population who reach working age each year.
Economists said Wednesday's move that followed a quarter-point cut in December should support government efforts to prop up the economy and saw more cuts before the end of the first quarter.
"This will definitely help the government's planned stimulus package," said Gundy Cahyadi, an economist at IDEAglobal in Singapore.
CREAKING INFRASTRUCTURE
The stimulus, which includes plans to spend on roads, ports, airports and railroads, is intended to create jobs and reduce business costs due to the country's creaking infrastructure.
"The rate cut will provide a stimulus to the economy. But the key lies in the fiscal policy, as well," said Eric Sugandi of Standard Chartered Bank in Jakarta.
"As Indonesia's economy is mostly driven by domestic consumption, now it's up to how the government sustains the purchasing power of households."
The finance ministry welcomed the rate cut, saying it should support government bonds.
"We see the prices of government bonds in the last two days have been increasing. We are optimistic it will be better in the future," treasury director Rahmat Waluyanto said.
The ministry on Wednesday said it planned to sell retail sukuk, or Islamic, bonds next month, and a yen-denominated bond issue, possibly around the middle of the year.
Anggito Abimanyu, head of fiscal policy at the finance ministry, said the government aims to get approval for standby loans of about $5.5 billion in the first quarter.
The loans, from the World Bank, Asian Development Bank, and some donor countries, would be used if the government cannot meet its debt issuance target.
With the global economy rapidly losing steam and the world's top economies already in a recession, other central banks in Asia have also been slashing borrowing costs to support faltering growth.
The Reserve Bank of India cut its benchmark rate by 1 percentage point on Jan. 2, while the Bank of Korea is expected to follow suit with a half percentage point cut on Jan. 9.
Investors pulled out of emerging markets like Indonesia late last year, in response to the global financial crisis, leading to a sharp drop in Indonesian stocks, bonds and the currency, which hit a decade low near 13,000 per dollar.
Analysts said lingering concerns about the rupiah may limit the scope for further rate cuts, even though the currency gained after the rate decision to 10,700 to the dollar from 10,850, reflecting market optimism about the growth outlook.
Indonesia set rules for commodity exports, protects currency
JAKARTA-
Indonesia will require commodities exporters to use letters of credit issued by local banks in future, to make sure that foreign exchange remains onshore, the trade minister said on Friday (9/1).
Indonesia has taken several steps to try to reduce capital outflows and lessen the impact of a world economic crisis.
The latest moves would force exporters to keep the foreign currency proceeds with a bank onshore, where the money would be subject to restrictions such as how much can be converted and transferred offshore.
"The regulation aims at keeping the flow of foreign exchange revenue fast and smooth," said Trade Minister Mari Pangestu.
Exporters of coffee, crude palm oil, cocoa, rubber and mineral products, including refined tin, must use letters of credit starting from March 5, the minister said.
"Letter of credit proceeds must go through and must be received by onshore banks," Pangestu told reporters.
"The requirement will also guarantee that exporters receive payment from buyers," she said, referring to cases where buyers have refused to pay on the arrival of a shipment because the commodity price has fallen.
Indonesia is one of the world's main producers of palm oil, rubber, coffee, cocoa, tin, nickel and coal. Prices for commodities including crude palm oil and tin have tumbled from their peaks due to weaker demand.
Many Indonesian exporters have cancelled shipments of commodities, including palm oil and rubber, after buyers failed to pay up because of the sliding in prices.
Indonesia will require commodities exporters to use letters of credit issued by local banks in future, to make sure that foreign exchange remains onshore, the trade minister said on Friday (9/1).
Indonesia has taken several steps to try to reduce capital outflows and lessen the impact of a world economic crisis.
The latest moves would force exporters to keep the foreign currency proceeds with a bank onshore, where the money would be subject to restrictions such as how much can be converted and transferred offshore.
"The regulation aims at keeping the flow of foreign exchange revenue fast and smooth," said Trade Minister Mari Pangestu.
Exporters of coffee, crude palm oil, cocoa, rubber and mineral products, including refined tin, must use letters of credit starting from March 5, the minister said.
"Letter of credit proceeds must go through and must be received by onshore banks," Pangestu told reporters.
"The requirement will also guarantee that exporters receive payment from buyers," she said, referring to cases where buyers have refused to pay on the arrival of a shipment because the commodity price has fallen.
Indonesia is one of the world's main producers of palm oil, rubber, coffee, cocoa, tin, nickel and coal. Prices for commodities including crude palm oil and tin have tumbled from their peaks due to weaker demand.
Many Indonesian exporters have cancelled shipments of commodities, including palm oil and rubber, after buyers failed to pay up because of the sliding in prices.
Wednesday, January 7, 2009
Indonesia's BCA sees loan growth slowing in 2009
JAKARTA- Indonesia's second-largest lender, PT Bank Central Asia Tbk, said on Wednesday that it expects loan growth to slow to about 15 percent this year, from about 36.5 percent in 2008.
BCA's loan growth in 2008 was higher than the central bank's forecast of about a third for the whole sector.
But BCA's vice president director, Jahja Setiaatmadja, said loan growth would slow as Southeast Asia's largest economy feels the impact of the global financial crisis.
"The growth (in 2008) was supported by our corporate lending, especially at the beginning of the sub-prime mortgage crisis when foreign banks stopped lending to Indonesian companies," Setiaatmadja told Reuters.
He said BCA's outstanding loans grew by around 30 trillion rupiah ($2.75 billion) last year, from 80.7 trillion rupiah at the end of 2007.
Indonesia's economic growth is expected to slow to 5 percent this year from an estimate of 6.2 percent in 2008. ($1=10,900 Rupiah)
BCA's loan growth in 2008 was higher than the central bank's forecast of about a third for the whole sector.
But BCA's vice president director, Jahja Setiaatmadja, said loan growth would slow as Southeast Asia's largest economy feels the impact of the global financial crisis.
"The growth (in 2008) was supported by our corporate lending, especially at the beginning of the sub-prime mortgage crisis when foreign banks stopped lending to Indonesian companies," Setiaatmadja told Reuters.
He said BCA's outstanding loans grew by around 30 trillion rupiah ($2.75 billion) last year, from 80.7 trillion rupiah at the end of 2007.
Indonesia's economic growth is expected to slow to 5 percent this year from an estimate of 6.2 percent in 2008. ($1=10,900 Rupiah)
Tuesday, January 6, 2009
Around Rp 240 billion of Investments in Sarijaya at Stake
Jakarta: Fraud allegations at Sarijaya securities company which led to the arrest of one of its executive was estimated to have involve around Rp 240 billion of investments.
Head of the Capital Market and Financial Institutions Supervisory Agency Fuad Rahmany said the troubled investments were not as big as the case of Century Bank, “however Sarijaya have thousands of clients, therefore we take a serious look on the matter.”
Fuad said the case of Sarijaya “would not spark economic impact as the amount of troubled investments were relatively not high, but the fraud allegations could actually inflict systematic impact on the market.
The crime according to Fuad was not only a form financial crime but also a form of general crime. The agency is handing the process to return Sarijaya clients investment to the police. The suspect according to the agency have taken investment decisions using clients money without authorization from the company's clients. The agency said it could not determine on when the conduct began.
Scores of clients of Sarijaya gathered at the company's office at Permata Tower I on Tuesday noon. Hasbi Sukaton, corporate secretay Sarijaya said the company manages around Rp 20 trillion of investments made by 8.700 clients as of January 6th 2009.
Head of the Capital Market and Financial Institutions Supervisory Agency Fuad Rahmany said the troubled investments were not as big as the case of Century Bank, “however Sarijaya have thousands of clients, therefore we take a serious look on the matter.”
Fuad said the case of Sarijaya “would not spark economic impact as the amount of troubled investments were relatively not high, but the fraud allegations could actually inflict systematic impact on the market.
The crime according to Fuad was not only a form financial crime but also a form of general crime. The agency is handing the process to return Sarijaya clients investment to the police. The suspect according to the agency have taken investment decisions using clients money without authorization from the company's clients. The agency said it could not determine on when the conduct began.
Scores of clients of Sarijaya gathered at the company's office at Permata Tower I on Tuesday noon. Hasbi Sukaton, corporate secretay Sarijaya said the company manages around Rp 20 trillion of investments made by 8.700 clients as of January 6th 2009.
Monday, January 5, 2009
Sumitomo gets Y160 Billion loan for Indonesia project
TOKYO- Sumitomo Corp, Japan's third-biggest trading house, said on Monday a consortium led by the state-backed Japan Bank for International Cooperation would lend it 160 billion yen ($1.7 billion) in syndicated loans for an Indonesian power project.
JBIC, which provides financing for acquisitions of natural resources and other assets for resource-poor Japan, has been playing a bigger role in domestic companies' project financing as the global financial crisis freezes up credit markets.
JBIC will provide 60 percent of the debt financing Sumitomo needs to double the capacity of its Tanjung Jati B coal-fired thermal power plant in Indonesia, a company spokesman said.
As part of the expansion, Sumitomo plans to build two 660-megawatt power generation plants next to its 1,320 MW existing plants located in the central part of Java island. The total project cost is 200 billion yen.
Sumitomo aims to tap strong demand for electricity in Indonesia, where the market is expected to grow 7 percent a year up to 2016, the company said.
The two new plants will be leased to Indonesian state-owned power company PT Perusahaan Listrik Negara.
The other lenders in the consortium are Bank of Tokyo-Mitsubishi UFJ, Sumitomo Mitsui Banking Corp and BNP Paribas.
JBIC, which provides financing for acquisitions of natural resources and other assets for resource-poor Japan, has been playing a bigger role in domestic companies' project financing as the global financial crisis freezes up credit markets.
JBIC will provide 60 percent of the debt financing Sumitomo needs to double the capacity of its Tanjung Jati B coal-fired thermal power plant in Indonesia, a company spokesman said.
As part of the expansion, Sumitomo plans to build two 660-megawatt power generation plants next to its 1,320 MW existing plants located in the central part of Java island. The total project cost is 200 billion yen.
Sumitomo aims to tap strong demand for electricity in Indonesia, where the market is expected to grow 7 percent a year up to 2016, the company said.
The two new plants will be leased to Indonesian state-owned power company PT Perusahaan Listrik Negara.
The other lenders in the consortium are Bank of Tokyo-Mitsubishi UFJ, Sumitomo Mitsui Banking Corp and BNP Paribas.
Indonesian General Insurers want bigger say
Jakarta
General insurers welcome the extension of the deadline for new capital requirements, but demand a say in the formulation of new regulations so as not to create undesired negative impacts on the industry.
"We want the government to discuss any revisions to be made with us first," Kornelius Simanjuntak, head of the General Insurance Association of Indonesia (AAUI), said on Monday.
"To this day, there seems to be an incoherence between the policy makers and the companies running the general insurance business."
The remarks came after the government recently extended the deadline for insurers to comply with tougher capital requirements in a consolidation drive aimed at strengthening the industry.
In June last year, the government issued regulation No. 39, stipulating that an insurer must have capital of at least Rp 100 billion, to be achieved in phases that would take three years to complete -- Rp 40 billion by 2008, Rp 70 billion by 2009 and Rp 100 billion in 2010.
Objecting to the new regulation, AAUI then formed an Ad Hoc team and demanded a review on the basis that as of the end of June, 26 general insurers still had equity worth less than Rp 40 billion.
Later in 2008, the government announced a revision, which extended the deadline to ensure Rp 40 billion by 2010, Rp 70 billion by 2012, and Rp 100 billion by 2014.
"However to this day, we have yet to receive a copy of this regulation," Kornelius said, pointing as an example of the gap between the decision makers and industry players.
Kornelius added that even with the revised time limits, small insurers will still have difficulties in complying, especially with the ongoing global economic problems.
"The fourth quarter of last year already saw a slowdown in the business, particularly vehicle insurance," he explained. "Vehicle sales are going downhill. That is bad news for the insurance business."
General insurers welcome the extension of the deadline for new capital requirements, but demand a say in the formulation of new regulations so as not to create undesired negative impacts on the industry.
"We want the government to discuss any revisions to be made with us first," Kornelius Simanjuntak, head of the General Insurance Association of Indonesia (AAUI), said on Monday.
"To this day, there seems to be an incoherence between the policy makers and the companies running the general insurance business."
The remarks came after the government recently extended the deadline for insurers to comply with tougher capital requirements in a consolidation drive aimed at strengthening the industry.
In June last year, the government issued regulation No. 39, stipulating that an insurer must have capital of at least Rp 100 billion, to be achieved in phases that would take three years to complete -- Rp 40 billion by 2008, Rp 70 billion by 2009 and Rp 100 billion in 2010.
Objecting to the new regulation, AAUI then formed an Ad Hoc team and demanded a review on the basis that as of the end of June, 26 general insurers still had equity worth less than Rp 40 billion.
Later in 2008, the government announced a revision, which extended the deadline to ensure Rp 40 billion by 2010, Rp 70 billion by 2012, and Rp 100 billion by 2014.
"However to this day, we have yet to receive a copy of this regulation," Kornelius said, pointing as an example of the gap between the decision makers and industry players.
Kornelius added that even with the revised time limits, small insurers will still have difficulties in complying, especially with the ongoing global economic problems.
"The fourth quarter of last year already saw a slowdown in the business, particularly vehicle insurance," he explained. "Vehicle sales are going downhill. That is bad news for the insurance business."
INDONESIA'S BNI PROCESSING LOAN OF US$3 BLN FOR TELKOM
PT Bank Negara Indonesia Tbk (BNI) is processing a syndicated credit of Rp 3 trillion (US$3 billion) for the state owned telecommunications company PT Telkom.
The state bank has been named as the lead arranger for the syndicated loan that will involve Bank Rakyat Indonesia (BRI) and a number of other local banks, BNI President Gatot M Suwondo said on Monday, 5th Januari 2009.
The country's largest telecommunications company will use the loan fund to help finance its capital expenditures, which are set at Rp22 trillion for this year, Gatot told the newspaper Investor Daily.
BNI corporate director Krishna Suparto said BNI will contribute Rp2 trillion to the syndicated credit.
The state bank has been named as the lead arranger for the syndicated loan that will involve Bank Rakyat Indonesia (BRI) and a number of other local banks, BNI President Gatot M Suwondo said on Monday, 5th Januari 2009.
The country's largest telecommunications company will use the loan fund to help finance its capital expenditures, which are set at Rp22 trillion for this year, Gatot told the newspaper Investor Daily.
BNI corporate director Krishna Suparto said BNI will contribute Rp2 trillion to the syndicated credit.
40 Malaysians And Indonesians Charged Arrested Because Hijact Account
KUALA LUMPUR- Forty people comprising Malaysians and Indonesians have been charged in Lahad Datu, Sabah, for being involved in a syndicate that has been transferring funds illegally to Indonesia via electronic banking, said Deputy Minister in the Prime Minister's Department Senator T Murugiah.
He said a bank had been facing this problem since 2006 and three cases had been reported to the bank, but "the bank officers ignored the complaints and did not want to take responsibility".
"When the funds disappeared to Indonesia, the recipients could not be identified or traced as their identities differed. They would change their names, photographs and so on in their identity card," he told reporters after observing efforts to repair the lifts at the Taman Sentul Utama flats, here, Sunday.
However, Murugiah did not give further details on the 40 people concerned.
He said the banks should be more sensitive to the problem as it involved public funds and trust in the bank.
"The amount that is frequently hijacked ranges between RM12,000 and RM13,000 and lately, 60 to 70 cases had been reported (to the Public Complaints Bureau," he said.
"But I am grateful to our Finance Minister (Datuk Seri Najib Tun Razak), because of his fast action in asking Bank Negara to investigate this problem because this is concerning our rakyat's money," he said.
Murugiah also advised the public to be wary and always check their accounts.
He said a bank had been facing this problem since 2006 and three cases had been reported to the bank, but "the bank officers ignored the complaints and did not want to take responsibility".
"When the funds disappeared to Indonesia, the recipients could not be identified or traced as their identities differed. They would change their names, photographs and so on in their identity card," he told reporters after observing efforts to repair the lifts at the Taman Sentul Utama flats, here, Sunday.
However, Murugiah did not give further details on the 40 people concerned.
He said the banks should be more sensitive to the problem as it involved public funds and trust in the bank.
"The amount that is frequently hijacked ranges between RM12,000 and RM13,000 and lately, 60 to 70 cases had been reported (to the Public Complaints Bureau," he said.
"But I am grateful to our Finance Minister (Datuk Seri Najib Tun Razak), because of his fast action in asking Bank Negara to investigate this problem because this is concerning our rakyat's money," he said.
Murugiah also advised the public to be wary and always check their accounts.
Friday, January 2, 2009
S KOREAN HANA FINANCIAL INJECTS MORE FUND TO BANK HANA INDONESIA
JAKARTA-
Hana Financial Group of South Korea has injected Rp 150 billion (US$ 16.35 million) to PT Bank Hana Indonesia to back up business expansion program of its Indonesian subsidiary.
Hana Financial still wants to acquire more local banks to be merged with Bank Hana Indonesia to place it among the country's 20 largest lenders.
Edy Kuntardjo, president of Bank Hana Indonesia on 26 August 2008 said the capital injection in early the second quarter increased the bank capital to Rp 300 billion with the stake of the Korean parent company rising from 60.9 per cent to 70.1 per cent.
Edy said part of the fund will be used to open new branches, adding this year the bank plans to open 124 new branches.
Commonwealth Denies to Acquisition Bank Ekonomi
SYDNEY- Commonwealth Bank of Australia (CBA), the country's second largest bank by assets, was unlikely to buy
CBA and HSBC had expressed interest in the Indonesian lender, after controlling shareholder Wings Group indicated a desire to sell. Bank Ekonomi is worth about A$592 million ($506 million), and had an initial public offering of about 10 percent of its share capital early this year, the Australian said.
The source, who declined to be identified, said CBA had held talks to acquire the Indonesian bank but was unlikely to win due to competition from other potential bidders.
Earlier this month, CBA withdrew from discussions with Royal Bank of
S KOREAN HANA FINANCIAL INJECTS MORE FUND TO BANK HANA INDONESIA
Hana Financial Group of
Hana Financial still wants to acquire more local banks to be merged with Bank Hana
Edy Kuntardjo, president of Bank Hana
Edy said part of the fund will be used to open new branches, adding this year the bank plans to open 124 new branches. (ef)
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