BNI moves closer to BTN merger<\/p>\n
Urip Hudiono, The Jakarta Post, Jakarta<\/p>\n
Bank Negara Indonesia's bid to acquire Bank Tabungan Negara (BTN)
\nhas moved a step further with the government saying that a merger
\nwas crucial in advancing the bank's capital to support plans on
\npart of the government to provide affordable housing loans to the
\npublic.<\/p>\n
The government, State Minister for State Enterprises Sugiharto
\nsaid on Wednesday, would also prioritize state-owned banks in the
\nconsolidation plan so as to maintain its control over BTN, which
\nspecializes in providing home loans to low- and middle-income
\npeople.<\/p>\n
As the government plans to request that the lender come up
\nwith the financing scheme to provide up to one million low-cost
\nhouses for the public within the next five years, Sugiharto
\nadded, BTN would need to boost its financial strength.<\/p>\n
\"BTN's limited capital has in the past rendered this plan (to
\nprovide financing for low-cost houses) impossible, while the
\ngovernment itself has no budget allocation for BTN for that,\" he
\nsaid.<\/p>\n
\"We must therefore look for other sources of capital,
\nparticularly from the capital market.\"<\/p>\n
Sugiharto added, however, that merging BTN with another bank
\nwas the most feasible way to obtain the needed capital, instead
\nof a recent proposal to sell 20 percent of the government's stake
\nin the bank through an initial public offering (IPO).<\/p>\n
\"The results from an IPO would only be 'pocket change' -- it
\nwould not be enough,\" he said.<\/p>\n
The minister also asserted that the government had considered
\nof state-owned banks for a merger with BTN, so as not to dilute
\nits current ownership in BTN.<\/p>\n
The government currently is the sole owner of BTN.<\/p>\n
Meanwhile, BNI president Sigit Pramono said that the country's
\nthird largest lender was fully prepared to go ahead with the
\nmerger, having set aside between Rp 2 trillion and Rp 3 trillion
\nfor the purpose.<\/p>\n
\"We will present our proposal to the central bank next week,\"
\nhe said.<\/p>\n
\"The proposal will consist of an initial acquisition of BTN,
\nin which we will buy out the government's entire stake in BTN, to
\nbe followed by a legal merger.\"<\/p>\n
An \"operational merger,\" Sigit added, would ensue later on,
\nperhaps within two years.<\/p>\n
He also asserted that BTN's management board would not be
\nchanged as they were the ones most competent in the business of
\nhome loans.<\/p>\n
Sigit expected the BNI-BTN merger, if materialized, would be
\nmutually beneficial. For BNI in particular, it would strengthen
\nits chance to become an anchor bank and improve its prospects
\nahead of a second public offering next year.<\/p>\n
The government currently holds a 99.12 percent stake in BNI,
\nwith the bank's employees owning 0.05 percent, and the investing
\npublic holding the balance.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bni-moves-closer-to-btn-merger-1447893297",
"image": ""
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"sponsor_url": "https:\/\/okusiassociates.com"
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