ANZ Bank Panin, Saratoga to bid for Bank Niaga

Wahyudi Soeriaatmadja and Aloysius Unditu, Bloomberg, Jakarta

PT ANZ Bank Panin, a venture controlled by Australia's No. 3 lender, and PT Saratoga Investama Sedaya, a local hedge fund, plan to bid for PT Bank Niaga, the second Indonesian bank offered for sale this year.

``There are good assets and we want to look at it,'' said Roosniati Salihin, a vice president at ANZ Bank Panin, 85 percent owned by Australia & New Zealand Banking Group Ltd. Saratoga, formed by the son of the founder Indonesia's largest automaker, is also bidding, said Sandiaga Uno, the fund's managing director.

A reviving economy may boost Niaga and other banks seized by the government after the crisis. ``The banks that are not dead are doing well,'' said John Stuermer, chief Asian economist at Bear Stearns Cos. ``That's why you'd want a bank.''

The Indonesian Bank Restructuring Agency (IBRA) said bidders have until 5 p.m. tomorrow to submit bids. Though it hasn't yet received any bids, it isn't worried.

``Learning from the last bank sale, investors normally submit their bids at the last minute,'' said Subowo Musa, the agency official who oversees bank sales. IBRA expects to announce a shortlist a week from tomorrow.

That isn't all IBRA learned from the BCA sale.

This time, there are two rounds, not just one. In the first, the most important criteria is the candidate's experience -- not the price they are willing to pay. Price is only ranked first during the second round.

Many analysts say IBRA erred during the BCA sale by focusing on the price. Otherwise, they say, Standard Chartered Plc, Europe's biggest bank, would have won the bidding over Farallon Capital Management LLC, a San Francisco-based hedge fund.

Indonesia needs to sell assets it seized after a financial crisis that plunged the economy into recession in 1998 and nearly bankrupted local banks.

It's trying to meet conditions set by the International Monetary Fund and plug a Rp 43 trillion (US$4.3 billion) budget deficit.

Some analysts said selling Niaga may prove more difficult than the sale of PT Bank Central Asia, which took two years of stop- start effort and ended with its sale to Farallon Capital Management LLC. Niaga is a fifth the size of BCA and focuses on corporate, not retail, customers.

``Bank Niaga's got nothing other than a banking license. said Teng Ngiek Lian, chief executive of Target Asset Management Pte, who manages S$130 million ($71 million). ``It was not particularly known for anything until it went under.''

Still, Niaga's net profit more than doubled last year to 202 billion rupiah, or Rp 2.6 a share.

Its smaller size may smooth the sale by making it less politically sensitive, some analysts said.

``Politically it is easier to sell -- Niaga will face less resistance,'' said Mirza Adityaswara, an analyst at Business Reform and Reconstruction Corp. ``It's easier precisely because it's not financially as attractive as BCA. The jewel is already sold.''

At current prices, the 51 percent government stake in Niaga that is up for sale is worth Rp 5.79 trillion ($605 million). The winning bidder is likely pay far less than the market value, as was the case with BCA.

Niaga shares were unchanged at Rp 145.