Bank Bali to launch rights issue soon<\/p>\n
JAKARTA (JP): Publicly listed Bank Bali plans to launch its
\nrights issue in late September to help raise Rp 5.3 trillion
\n(US$646 million) in recapitalization funds, the bank said on
\nTuesday.<\/p>\n
Budi Purwanto, a member of Bank Bali's management team, said
\nthat the bank would sell 66.5 billion new shares to existing
\nshareholders during the limited public offering.<\/p>\n
\"The shares, with a nominal value of Rp 5, will be sold at Rp
\n80.51 each during the offering period between Sept. 20 and Sept.
\n26,\" he said at the company's public presentation.<\/p>\n
He said existing shareholders were entitled to buy 99 rights
\nshares for every share they already hold in the 99-for-one rights
\nissue.<\/p>\n
The Indonesian Bank Restructuring Agency (IBRA) will act as
\nthe standby buyer in the rights issue on behalf of the
\ngovernment.<\/p>\n
Bank Bali expected the government to inject bonds of up to Rp
\n5.3 trillion some time in October for any unsold shares.<\/p>\n
Bank Bali, one of several banks joining the government-
\nsponsored recapitalization program, expects the rights issue to
\nhelp raise its Capital Adequacy Ratio (CAR) to 12.81 percent from
\nminus 167.64 percent at present.<\/p>\n
Like other banks, Bank Bali suffered massive losses due to a
\nhuge negative spread, a condition where the interest payment was
\nmuch higher than the interest earning.<\/p>\n
The bank, which suffered a net loss of Rp 2.58 trillion in
\n1998 and Rp 2.02 trillion in 1999, showed a slight improvement in
\nthe first semester of this year. But the bank's net loss was
\nstill high at Rp 623.33 billion during the January-June period.<\/p>\n
Bank Bali estimated the losses would decline to Rp 1.1
\ntrillion this year, and it would book gross profits of Rp 655
\nmillion by 2001 and Rp 154.5 billion by 2002.<\/p>\n
Bank Bali's financial report as of June 30, shows total assets
\nof Rp 5.1 trillion .<\/p>\n
The bank, with 285 branches and 5,000 employees, was one of
\nthe country's best performing banks before the economic crisis
\nbegan in 1997.<\/p>\n
Bank Bali is 50.2 percent owned by the German-based investment
\nfirm Deutsche Clearing Bourse AG, (DBC), 13.93 percent by PT
\nSarijaya Wirasentosa, which is owned by the bank's former
\npresident Rudy Ramli, and 8.29 percent by PT Sanwa Bank Ltd. The
\npublic owns the remaining shares.<\/p>\n
Budi said that the rights issue would cause a 99 percent
\ndilution of the shareholders' ownership if they do not exercise
\ntheir rights.<\/p>\n
IBRA has said that the Capital Market Supervisory Agency
\n(Bapepam) would freeze the voting rights of the owners of the
\nshares, which are kept at DBC, during the upcoming rights issue
\nif they refused to reveal their names.<\/p>\n
The move would cause DBC's stake in Bank Bali to dilute from
\n50 percent down to 0.5 percent. (bkm)<\/p>",
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