Bank BNI to open new branch in LA later this year<\/p>\n
JAKARTA (JP): State-owned Bank Negara Indonesia (BNI) is to
\nopen a new branch in Los Angeles later this year and financing
\narms in Hong Kong and Luxembourg as part of its overseas
\nexpansion program.<\/p>\n
BNI president Widigdo Sukarman said yesterday that the Los
\nAngeles office will be the second branch in the United States
\nafter the one in New York.<\/p>\n
\"We expect to increase the number of overseas branches to
\neight by the year 2000,\" he said.<\/p>\n
BNI, which at present has six overseas branches -- in the
\nCayman Islands, New York, Tokyo, Hong Kong, Singapore and London
\n-- is currently preparing the establishment of two merchant
\nbanks, in Luxembourg and Hong Kong, as part of the expansion
\nprogram.<\/p>\n
He said that the overseas expansion is essential to tap
\ngrowing activities of Indonesian companies abroad and to benefit
\nfrom the increase in the number of local borrowers seeking funds
\nfrom offshore financial sources.<\/p>\n
The bank is also expanding its domestic networks. It currently
\noperates 485 branches, mostly in Java, Sumatra and Bali, and 300
\nautomated teller machines in Jakarta and other cities in Java.<\/p>\n
Widigdo, who replaced Winarto Sumarto as the bank's president
\nin April, said that BNI is also placing more emphasis on retail
\nbanking to serve the growing number of medium-scale companies at
\nhome.<\/p>\n
At present BNI provides around 60 percent of its loans for
\ncorporate borrowers and another 40 percent for its retail
\nclients.<\/p>\n
\"We hope the segment of our retail market will reach 50
\npercent in the next few years,\" he said.<\/p>\n
Widigdo said that the bank's total assets reached Rp 31.81
\ntrillion (US$13.83 billion) as of March this year, with
\noutstanding loans amounting to Rp 20.7 trillion and deposits
\nexceeding Rp 18 trillion in the same period.<\/p>\n
The pre-tax profits in the Jan-March period totaled Rp 112.6
\nbillion, he said.<\/p>\n
Widigdo, who was the president of the state-owned Bank
\nTabungan Negara before assuming his present job, said that the
\nbank's bad (totally unpaid) loans were 0.58 percent of its total
\nlendings.<\/p>\n
He, however, said that the amount of problematic loans is much
\nhigher, around 4 percent of total loans.<\/p>\n
In 1995, BNI, the largest state-owned bank, reported a 26.1
\npercent increase in its pre-tax profits to Rp 410.1 billion in
\n1995.<\/p>\n
The bank's pre-tax profits are projected to increase to Rp 445
\nbillion this year.<\/p>\n
Widigdo said that the bank's assets and lendings are expected
\nto increase respectively by 12.8 percent and 17 percent this
\nyear.<\/p>\n
BNI has also almost completed its preparations to go public,
\nhe said but he declined to unveil when the public offering would
\nbe launched.<\/p>\n
\"I cannot tell you when but for sure we will do it this year,\"
\nhe said of the flotation. It was earlier scheduled for July.<\/p>\n
He also declined to detail the number of the bank's shares to
\nbe sold or the value of the fresh funds to be raised from the
\nplanned initial public offering.<\/p>\n
Widigdo said the bank has appointed GP Morgan as a consultant
\nfor the public offering and assigned state-owned Danareksa
\nSekuritas as the lead underwriter.<\/p>\n
According to an earlier report, the bank expects to raise
\naround Rp 100 billion (US$48 million) from the planned public
\noffering. (hen)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bank-bni-to-open-new-branch-in-la-later-this-year-1447893297",
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"sponsor": "Okusi Associates",
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