JAKARTA-
PT Bank Rakyat Indonesia (BRI)(JSX:BBRI), a publicly traded lender, said it will raise the value of bonds it plans to issue to Rp3 trillion (US$321 million) from Rp2 trillion set earlier.
The state bank, however, is still awaiting a go ahead from the capital market watchdog Bapepam to issue the bond scheduled for next month or December.
BRI Director Abdul Salam said the improved condition of the market prompted the bank management to raise the value.
With the bond fund, BRI hoped to maintain a safe capital adequacy ratio at 15 per cent, Salam said.
In June BRI's CAR was 14 per cent and the level was believed to have declined with dividend paid to the government.
Friday, October 30, 2009
Friday, October 23, 2009
Five Indonesian banks set to launch Islamic units
* BI says sharia units can become sharia banks in one month
* Revised law on VAT encouraging banks to set up sharia units
* Paper reports U.S. insurer looking at buying sharia bank
JAKARTA - Five Indonesian banks including Bank Central Asia (BBCA.JK), the No. 3 lender, expect to launch standalone sharia units next year, boosting the sharia market in the world's most populous Muslim nation, officials said.
Industry officials said the revised law on value added tax, which removed double taxation in the Islamic market, would encourage more banks to set up Islamic banking subsidiaries. The double taxation had made Islamic transactions more expensive than comparable conventional deals.
"We hope that it would be easier for us to expand business and seek strategic partners. We also hope to grow faster and attract investors from Middle East," said Barno Sudarwanto, head of planning and development at the sharia unit of Bank Negara Indonesia (BBNI.JK), the No. 4 bank, which will be spun off.
Others due to set up separate sharia banking units include mid-sized lenders Bank Panin (PNBN.JK), Bank Victoria (BVIC.JK) and unlisted Bank Jabar Banten.
Investor Daily newspaper on Friday reported that a U.S. insurance firm had met with central bank officials this week to discuss the possibility of buying an Islamic-compliant lender in Indonesia, without giving details.
Conventional banks typically set up their Islamic subsidiaries by first setting up Islamic banking departments and later on converting them into separate Islamic banks. Others, including BCA, may acquire smaller conventional banks and turn them into Islamic subsidiaries.
"I expect to see more banks spinning off their sharia units as the new VAT law which scraps double taxation from sharia transactions will take effect next year," said Adiwarman Karim, chief of Karim Business Consulting.
The firm offers consultancy services on the Islamic market, including the establishment of Islamic banks.
Indonesia currently has five sharia banks and 24 commercial banks with sharia units as of August 2009, out of around 130 commercial banks operating in Southeast Asia's biggest economy.
ACQUISITIONS
BCA vice president director Jahja Setiaatmadja told Reuters the bank was in the final stage of setting up such a unit, adding that operations may start in January. He declined to give further details.
BCA, with a stock market value of $12 billion, acquired Bank UIB in October 2008 and planned to convert the small lender into a sharia bank.
Ramzi A. Zuhdi, director in charge of Islamic banking at the Indonesian central bank, said it took about a month for banks to obtain approvals to convert their Islamic banking units into Islamic banks if all the administrative requirements were met
In neighbouring Malaysia, seen as the Islamic financial hub in Asia, domestic banks can immediately convert their Islamic units operating under the parent companies into separate entities, said Vaseehar Hassan Abdul Razack, chairman of Unicorn International Islamic Bank Malaysia.
Riawan Amin, the chairman of Indonesia's association of Islamic banks (Asbisindo), said it often took longer than initially expected to launch Islamic banks in the country due partly to administrative reasons such as in recruiting employees.
October 23th 2009 By Reuters.
* Revised law on VAT encouraging banks to set up sharia units
* Paper reports U.S. insurer looking at buying sharia bank
JAKARTA - Five Indonesian banks including Bank Central Asia (BBCA.JK), the No. 3 lender, expect to launch standalone sharia units next year, boosting the sharia market in the world's most populous Muslim nation, officials said.
Industry officials said the revised law on value added tax, which removed double taxation in the Islamic market, would encourage more banks to set up Islamic banking subsidiaries. The double taxation had made Islamic transactions more expensive than comparable conventional deals.
"We hope that it would be easier for us to expand business and seek strategic partners. We also hope to grow faster and attract investors from Middle East," said Barno Sudarwanto, head of planning and development at the sharia unit of Bank Negara Indonesia (BBNI.JK), the No. 4 bank, which will be spun off.
Others due to set up separate sharia banking units include mid-sized lenders Bank Panin (PNBN.JK), Bank Victoria (BVIC.JK) and unlisted Bank Jabar Banten.
Investor Daily newspaper on Friday reported that a U.S. insurance firm had met with central bank officials this week to discuss the possibility of buying an Islamic-compliant lender in Indonesia, without giving details.
Conventional banks typically set up their Islamic subsidiaries by first setting up Islamic banking departments and later on converting them into separate Islamic banks. Others, including BCA, may acquire smaller conventional banks and turn them into Islamic subsidiaries.
"I expect to see more banks spinning off their sharia units as the new VAT law which scraps double taxation from sharia transactions will take effect next year," said Adiwarman Karim, chief of Karim Business Consulting.
The firm offers consultancy services on the Islamic market, including the establishment of Islamic banks.
Indonesia currently has five sharia banks and 24 commercial banks with sharia units as of August 2009, out of around 130 commercial banks operating in Southeast Asia's biggest economy.
ACQUISITIONS
BCA vice president director Jahja Setiaatmadja told Reuters the bank was in the final stage of setting up such a unit, adding that operations may start in January. He declined to give further details.
BCA, with a stock market value of $12 billion, acquired Bank UIB in October 2008 and planned to convert the small lender into a sharia bank.
Ramzi A. Zuhdi, director in charge of Islamic banking at the Indonesian central bank, said it took about a month for banks to obtain approvals to convert their Islamic banking units into Islamic banks if all the administrative requirements were met
In neighbouring Malaysia, seen as the Islamic financial hub in Asia, domestic banks can immediately convert their Islamic units operating under the parent companies into separate entities, said Vaseehar Hassan Abdul Razack, chairman of Unicorn International Islamic Bank Malaysia.
Riawan Amin, the chairman of Indonesia's association of Islamic banks (Asbisindo), said it often took longer than initially expected to launch Islamic banks in the country due partly to administrative reasons such as in recruiting employees.
October 23th 2009 By Reuters.
Thursday, October 22, 2009
SBI eyes second buy in Indonesia
Mumbai: State Bank of India (SBI), the country's largest bank, is actively considering a buyout in Indonesia. The deal size is expected to be over $100 million.
A senior SBI executive told FE, “The bank has already shortlisted three to four Indonesian banks for the proposed acquisition.” The deal would be SBI's second acquisition in Indonesia. In 2006, SBI had acquired 76% stake in PT Bank Indo Monex, an Indonesia bank, which was renamed as Bank SBI Indonesia—a SBI subsidiary.
"The Indonesian bank, which SBI is eyeing, would be merged with Bank SBI Indonesia that currently offers retail and wholesale banking services through 12 branches in the country," the SBI executive said.
In a bid to capitalise on the rising trade and investment between Indonesia and India, Bank SBI Indonesia had launched its foreign exchange trade facility last month. This facility enables the bank to offer foreign exchange services, trade finance and remittance facilities, and depository advisory services. Indonesia is India's second largest export market in Asean after Singapore. India is one of the largest importers of Indonesian commodities including palm oil, coil and gambier.
Indonesia is ranked 16th as a source of imports for India at $6.1 billion as on March 30, 2009, up 38% over the previous year. Currently, India's investments in Indonesia are at an impressive $2 billion. Indo-Indonesian trade crossed $10.6 billion last fiscal.
Sources reveal that SBI is also assessing a possibility to penetrate in countries such as Thailand and Vietnam. The bank is likely to open a representative office in Malaysia by March 2010. SBI's thrust to capture the lucrative business from the Far East region is evident from its Singapore subsidiary's balance sheet size that crossed $2 billion-mark as on September 30, 2009. SBI Singapore's trade finance business grew over 50% in the last six months.
To promote retail lending in Singapore, SBI is expected to open three new branches and two more off-site ATMs at a cumulative investment of over sing$35 million, and recruit over 60 personnel across various levels in the next 3-4 months. The bank launched its mortgage service on August 9, 2009. Till-date, it has transacted business worth over sing$10 million. SBI Singapore currently operates six branches and five off-set ATMs in the country.
As on March 30, 2009, SBI had 92 overseas offices across 32 countries, comprising of 37 branches, five sub offices, eight representative offices, 35 branches of subsidiaries, three managed exchange.
A senior SBI executive told FE, “The bank has already shortlisted three to four Indonesian banks for the proposed acquisition.” The deal would be SBI's second acquisition in Indonesia. In 2006, SBI had acquired 76% stake in PT Bank Indo Monex, an Indonesia bank, which was renamed as Bank SBI Indonesia—a SBI subsidiary.
"The Indonesian bank, which SBI is eyeing, would be merged with Bank SBI Indonesia that currently offers retail and wholesale banking services through 12 branches in the country," the SBI executive said.
In a bid to capitalise on the rising trade and investment between Indonesia and India, Bank SBI Indonesia had launched its foreign exchange trade facility last month. This facility enables the bank to offer foreign exchange services, trade finance and remittance facilities, and depository advisory services. Indonesia is India's second largest export market in Asean after Singapore. India is one of the largest importers of Indonesian commodities including palm oil, coil and gambier.
Indonesia is ranked 16th as a source of imports for India at $6.1 billion as on March 30, 2009, up 38% over the previous year. Currently, India's investments in Indonesia are at an impressive $2 billion. Indo-Indonesian trade crossed $10.6 billion last fiscal.
Sources reveal that SBI is also assessing a possibility to penetrate in countries such as Thailand and Vietnam. The bank is likely to open a representative office in Malaysia by March 2010. SBI's thrust to capture the lucrative business from the Far East region is evident from its Singapore subsidiary's balance sheet size that crossed $2 billion-mark as on September 30, 2009. SBI Singapore's trade finance business grew over 50% in the last six months.
To promote retail lending in Singapore, SBI is expected to open three new branches and two more off-site ATMs at a cumulative investment of over sing$35 million, and recruit over 60 personnel across various levels in the next 3-4 months. The bank launched its mortgage service on August 9, 2009. Till-date, it has transacted business worth over sing$10 million. SBI Singapore currently operates six branches and five off-set ATMs in the country.
As on March 30, 2009, SBI had 92 overseas offices across 32 countries, comprising of 37 branches, five sub offices, eight representative offices, 35 branches of subsidiaries, three managed exchange.
Sunday, October 18, 2009
Malaysia's RHB to pay $356mln for Bank Mestika
KUALA LUMPUR-
Malaysia's fourth-biggest lender RHB Capital (RHBC.KL) will pay 1.2 billion ringgit ($356.1 million) in cash for a controlling stake in Indonesia's PT Bank Mestika Dharma, joining rivals in the chase to gain a foothold in Southeast Asia's most populous country.
RHB said in a statement ahead of a press conference on Monday that it would also undertake a rights issue of 361 million shares, priced at 3.60 ringgit per share.
Malaysia's top two banks, Malayan Banking (Maybank) (MBBM.KL) and CIMB (CIMB.KL), already have a presence in the underbanked Indonesian market.
Analysts said loans growth in Indonesia's banking market, with its huge population, are expected to grow 15-25 percent this year.
Bank Mestika is based in Medan in Sumatra, Indonesia's third-most populous city after Jakarta and Surabaya.
Malaysia's fourth-biggest lender RHB Capital (RHBC.KL) will pay 1.2 billion ringgit ($356.1 million) in cash for a controlling stake in Indonesia's PT Bank Mestika Dharma, joining rivals in the chase to gain a foothold in Southeast Asia's most populous country.
RHB said in a statement ahead of a press conference on Monday that it would also undertake a rights issue of 361 million shares, priced at 3.60 ringgit per share.
Malaysia's top two banks, Malayan Banking (Maybank) (MBBM.KL) and CIMB (CIMB.KL), already have a presence in the underbanked Indonesian market.
Analysts said loans growth in Indonesia's banking market, with its huge population, are expected to grow 15-25 percent this year.
Bank Mestika is based in Medan in Sumatra, Indonesia's third-most populous city after Jakarta and Surabaya.
Thursday, October 15, 2009
IMF Indonesia rep says strong rupiah can help contain inflation
JAKARTA-
The appreciation of Indonesia's rupiah could help contain price pressure in Southeast Asia's biggest economy, the International Monetary Fund's senior resident representative in Indonesia said on Wednesday.
Milan Zavadjil, the IMF's representative, also told Reuters in an email that the central bank, Bank Indonesia (BI), was right to direct intervention to trying to reduce volatility in the rupiah, which is Asia's best-performing currency so far this year.
'In the current situation of strong capital inflows, the appreciation of the rupiah can help contain domestic price rises. BI is right to direct intervention largely at reducing volatility,' he said.
Zavadjil noted that the country's exchange rate flexibility has helped it in the past to deal with large capital flows.
'Exchange rate flexibility has served as an important shock absorber for Indonesia,' he said.
'During the worse of the global financial crisis, the flexibility of the currency helped absorb large capital outflows, thus avoiding a large loss in reserves and a loss in confidence.' October 14th 2009.
The appreciation of Indonesia's rupiah could help contain price pressure in Southeast Asia's biggest economy, the International Monetary Fund's senior resident representative in Indonesia said on Wednesday.
Milan Zavadjil, the IMF's representative, also told Reuters in an email that the central bank, Bank Indonesia (BI), was right to direct intervention to trying to reduce volatility in the rupiah, which is Asia's best-performing currency so far this year.
'In the current situation of strong capital inflows, the appreciation of the rupiah can help contain domestic price rises. BI is right to direct intervention largely at reducing volatility,' he said.
Zavadjil noted that the country's exchange rate flexibility has helped it in the past to deal with large capital flows.
'Exchange rate flexibility has served as an important shock absorber for Indonesia,' he said.
'During the worse of the global financial crisis, the flexibility of the currency helped absorb large capital outflows, thus avoiding a large loss in reserves and a loss in confidence.' October 14th 2009.
3 Indonesia banks agree to US$329 mln loan for coal power plants
JAKARTA- Three Indonesian state-owned banks agreed Wednesday to extend a syndicated loan of Rp3.94 trillion (US$328.5 million) to finance the construction of coal-fired power plants (PLTUs) in Lampung and North Sumatra provinces. BANK RAKYAT INDONESIA (BRI)(JSX:BBRI) and Rp1.28 from BANK NEGARA INDONESIA (BNI)(JSX:BBNI) and BANK MANDIRI (JSX:BMRI) will each contribute Rp1.38 trillion.
* BRI director Asmawi Syam, BNI director Riswandi and Bank Mandiri vice president director I Wayan Agus Mertayasa signed an agreement on the syndicated loan with state electricity company PT PERUSAHAAN LISTRIK NEGARA (PLN) president director Fahmi Mochtar in the presence of Coordinating Minister for Economic Affairs/Finance Minister Sri Mulyani on Wednesday.
* Riswandi said the syndicated loan will account for 85 per cent of the total funds needed to construct PLTU Tarahan in Lampung and PLTU Pangkalan Susu in North Sumatra.
* BRI director Asmawi Syam, BNI director Riswandi and Bank Mandiri vice president director I Wayan Agus Mertayasa signed an agreement on the syndicated loan with state electricity company PT PERUSAHAAN LISTRIK NEGARA (PLN) president director Fahmi Mochtar in the presence of Coordinating Minister for Economic Affairs/Finance Minister Sri Mulyani on Wednesday.
* Riswandi said the syndicated loan will account for 85 per cent of the total funds needed to construct PLTU Tarahan in Lampung and PLTU Pangkalan Susu in North Sumatra.
Saturday, October 10, 2009
Nishat Group Chmn:To Join Maybank In Buying Stakes In Overseas Bks
KARACHI (Dow Jones)-
Pakistan's Nishat Group said Wednesday it will tie up with Malaysia's Malayan Banking Bhd. (1155.KU), or Maybank, to buy stakes in overseas banks.
"We now plan to move ahead with acquiring stakes in some banks in the Middle East and Indonesia," Nishat Group Chairman Mian Mansha told reporters.
He declined to name the potential targets or the likely investment that could be made.
Mansha said the group's MCB Bank (MCB.KA), in which Maybank is a shareholder, is likely to complete the buyout of the Royal Bank of Scotland Group PLC's (RBS) Pakistan operations in two weeks.
The MCB Bank had bought Royal Bank of Scotland's Pakistan assets in August this year.
Pakistan's Nishat Group said Wednesday it will tie up with Malaysia's Malayan Banking Bhd. (1155.KU), or Maybank, to buy stakes in overseas banks.
"We now plan to move ahead with acquiring stakes in some banks in the Middle East and Indonesia," Nishat Group Chairman Mian Mansha told reporters.
He declined to name the potential targets or the likely investment that could be made.
Mansha said the group's MCB Bank (MCB.KA), in which Maybank is a shareholder, is likely to complete the buyout of the Royal Bank of Scotland Group PLC's (RBS) Pakistan operations in two weeks.
The MCB Bank had bought Royal Bank of Scotland's Pakistan assets in August this year.
Maybank CEO: No immediate plans for new acquisitions
KUALA LUMPUR-
Malayan Banking Bhd (Maybank) chief executive officer Datuk Seri Abdul Wahid Omar has dismissed reports that the group is looking to purchase new banking assets after spending RM11.1bil last year on acquisitions overseas.
“We did three acquisitions last year, and we have enough on our plates. The focus for us now is organic growth,” Wahid, who is also the bank’s president, said at a press conference to launch Maybank’s latest premium debit card product.
Earlier this week, the chairman of Pakistan’s Nishat Group, Mian Mohammad Mansha, was quoted in a foreign news report as saying that MCB Bank Ltd and Maybank may team up to acquire banks in the Middle East and Indonesia.
“It is not true. I believe the chairman’s statement was taken out of context,’’ Wahid said.
Nishat Group owns an estimated 32% stake in MCB Bank, while Maybank owns a 20% share in the Pakistan-based lender.
Wahid also ruled out a possible bid for a strategic stake in Bank Islam Malaysia Bhd.
“This is something which we have not looked into,’’ he said.
Maybank Islamic Bhd is currently the country’s biggest Islamic bank with total assets of RM35bil, and “we believe there is tremendous opportunity to expand our Islamic banking operations organically,’’ according to Wahid.
Last week, Dubai Financial Group confirmed that it was in the process of reviewing its strategic options relating to its 40% stake in Bank Islam.
Maybank Islamic had been previously linked as a possible buyer.
Elaborating on the group’s organic expansion plans, Wahid said this might include setting up Islamic banking operations in Indonesia.
Maybank had earlier announced that its unit Bank Internasional Indonesia (BII) will add 200 new branches to its existing 250 outlets over the next three years.
Wahid is also planning to boost contributions from the group’s operations in the Philippines and Cambodia by opening new branches in the two countries.
Malaysia’s biggest bank is also strengthening its grip in the home market.
In the debit-card business, Maybank has a dominant market share of 80% in terms of total billings and a 26% share of the total 24.4 million debit-card holders in the country.
Wahid estimated that Maybank’s debit-card transactions amounted to about RM120mil a month.“For Maybank MasterCard Platinum Debit, we are targeting to recruit half a million card members in two years,’’ Wahid said, adding that the latest product, aimed at big spenders and rich customers, would boost Maybank’s debit-card billings by 80% by the end of 2010.
Malayan Banking Bhd (Maybank) chief executive officer Datuk Seri Abdul Wahid Omar has dismissed reports that the group is looking to purchase new banking assets after spending RM11.1bil last year on acquisitions overseas.
“We did three acquisitions last year, and we have enough on our plates. The focus for us now is organic growth,” Wahid, who is also the bank’s president, said at a press conference to launch Maybank’s latest premium debit card product.
Earlier this week, the chairman of Pakistan’s Nishat Group, Mian Mohammad Mansha, was quoted in a foreign news report as saying that MCB Bank Ltd and Maybank may team up to acquire banks in the Middle East and Indonesia.
“It is not true. I believe the chairman’s statement was taken out of context,’’ Wahid said.
Nishat Group owns an estimated 32% stake in MCB Bank, while Maybank owns a 20% share in the Pakistan-based lender.
Wahid also ruled out a possible bid for a strategic stake in Bank Islam Malaysia Bhd.
“This is something which we have not looked into,’’ he said.
Maybank Islamic Bhd is currently the country’s biggest Islamic bank with total assets of RM35bil, and “we believe there is tremendous opportunity to expand our Islamic banking operations organically,’’ according to Wahid.
Last week, Dubai Financial Group confirmed that it was in the process of reviewing its strategic options relating to its 40% stake in Bank Islam.
Maybank Islamic had been previously linked as a possible buyer.
Elaborating on the group’s organic expansion plans, Wahid said this might include setting up Islamic banking operations in Indonesia.
Maybank had earlier announced that its unit Bank Internasional Indonesia (BII) will add 200 new branches to its existing 250 outlets over the next three years.
Wahid is also planning to boost contributions from the group’s operations in the Philippines and Cambodia by opening new branches in the two countries.
Malaysia’s biggest bank is also strengthening its grip in the home market.
In the debit-card business, Maybank has a dominant market share of 80% in terms of total billings and a 26% share of the total 24.4 million debit-card holders in the country.
Wahid estimated that Maybank’s debit-card transactions amounted to about RM120mil a month.“For Maybank MasterCard Platinum Debit, we are targeting to recruit half a million card members in two years,’’ Wahid said, adding that the latest product, aimed at big spenders and rich customers, would boost Maybank’s debit-card billings by 80% by the end of 2010.
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