Bakrie, Danamon fight to buy Bank Pacifik
Bakrie, Danamon fight to buy Bank Pacifik
KUALA LUMPUR (JP): The Bakrie Group's Bank Nusa International
and the publicly listed Bank Danamon, which the Usman Admadja
family controls, are competing to buy the ailing Bank Pacific.
Bakrie Group chairman Aburizal Bakrie confirmed here yesterday
that Bank Nusa would probably be merged with the Bank Pacific
subject to the approval of Bank Indonesia, the central bank.
"Yes, we are interested. But it depends on Bank Indonesia. If
they agree, we are ready," Aburizal said.
He said his company had told the central bank of its intention
to merge Bank Nusa with Bank Pacific. The central bank is Bank
Pacific's majority shareholder.
Bank Nusa had received a commitment from several investors,
including President Soeharto's daughter Siti Hediati, to provide
finance to support Bank Pacific, he said.
Meanwhile Bank Danamon, the country's second largest private
bank is reportedly negotiating with the central bank about a
possible takeover.
The central bank owns 51 percent of Bank Pacific and the
bank's founder Ibnu Sutowo, a former president state oil company
Pertamina, owns the remaining 49 percent.
Bank Pacific was on the brink of collapse in late 1995 because
of bad loans and the central bank bailed it out.
The bank's current bad loans are estimated at Rp 2.1 trillion
(US$876 million). At the end of 1995 its total assets were
estimated at Rp 2.2 trillion.
Most of the bad debts were incurred by PT Pacific
International Finance, a company owned by Endang Utari Mokodompit
-- the bank's former president and Ibnu Sutowo's daughter.
Pacific International reportedly used most its Bank Pacific
earnings in the property sector, including the Lido resort in
West Java, which turned into a sour business.
To help salvage the bank, Bank Indonesia assigned state-owned
Bank Negara Indonesia (BNI) 1946 to manage it. BNI injected Rp
500 billion on the bank. BNI then issued money market securities
worth Rp 500 billion which the central bank bought out.
Aburizal said if Bank Nusa managed to merge with Bank Pacific,
the Bakrie Group's share in the merged bank would shrink to 25
percent.
"It's all right, if we lose some of our control," Aburizal
said.
Reliable sources said central bank Governor J. Soedradjad
Djiwandono had not yet approved Bank Nusa's offer although
several reliable investors supported the bid.
Several parties, including a senior minister, have frowned
upon the possibility of Bank Danamon buying Bank Pacific because
it would further strengthen certain groups' domination of in the
financial sector.
Banking sources said Bank Danamon would not finance its
acquisition entirely with fresh funds.
Bank Danamon has bought several ailing banks making it the
second largest private bank in asset terms.
It owns the former Bank Sampoerna, which it renamed Bank
Delta, and the former Bank Continental, renamed as Bank Dana
Asia. (rid)