Permata management rejects BNI merger plans<\/p>\n
Dadan Wijaksana , The Jakarta Post, Jakarta<\/p>\n
Bank Permata's management has rejected a high-profile merger
\nplan with Bank Negara Indonesia (BNI), saying it would prefer
\nfocusing on improving its performance to bolster its value ahead
\nof the government's planned divestment program.<\/p>\n
While acknowledging the final decision would lay with the
\ngovernment as the bank's majority shareholder, company president
\nAgus Martowardoyo said Permata should instead focus on its core
\nbusinesses to strengthen its already strong position in the
\nretail and consumer market.<\/p>\n
\"We want to concentrate on the bank's business performance, so
\nthat the government's divestment program can bring about the best
\npossible proceeds,\" Agus said on Wednesday after the bank's
\nshareholders' meeting.<\/p>\n
The government currently holds a 91.3 percent stake in
\nPermata, which it plans to sell sometime this year as part of its
\ndivestment program.<\/p>\n
However, latest developments show BNI, one of the nation's
\nbanking heavyweights, is pursuing a merger with Permata. BNI
\nclaims to have secured the approval from Permata over the plan
\nand has already proposed the move to the central bank.<\/p>\n
BNI has said the merger would form a perfect synergy as the
\ntwo banks have different core businesses. While Permata's focus
\nis on the consumer and retail sectors, BNI is predominantly a
\nlender to corporations.<\/p>\n
However, president of Permata's board of commissioners
\nAditiawan Chandra said the bank had never been included in the
\nmerger talks -- a situation he strongly criticized.<\/p>\n
\"The time is over for forced marriages without consent,\" he
\nsaid, adding a merger should only be considered as the last
\noption if other moves failed.<\/p>\n
\"Permata was formed from the merger of five banks -- this has
\ncaused a lot of problems. A merger process usually involves
\n(combining) healthy banks with less-healthy banks,\" he said.<\/p>\n
Permata was formed from a merger of five banks controlled by
\nthe now-defunct IBRA -- Bank Bali, Bank Universal, Bank
\nArthamedia, Bank Prima Express and Bank Patriot -- to become the
\ncountry's 10th-largest lender.<\/p>\n
It now boasts around Rp 30 trillion in assets.<\/p>\n
In other matters, the bank's shareholders approved a
\nmanagement proposal for a reverse stock split of the bank's share
\nat a ratio of 25:1 to increase its price.<\/p>\n
The plan, which will reduce the bank's shares from the current
\n193 billion to 7.7 billion, is expected to be completed by the
\nsecond week of June.<\/p>\n
\"Theoretically, the move will boost the share price from Rp 40
\nat present to around Rp 1,000 per share,\" Elvyn G. Masassya, a
\nbank director, said.<\/p>\n
The meeting also confirmed the opening of the bank's Islamic-
\nbased Syariah business unit.<\/p>\n
Syariah banking has started to gain popularity in the country
\nparticularly in the past couple of years with a number of major
\nbanks have already opened similar operation.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/permata-management-rejects-bni-merger-plans-1447893297",
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