Bank Artha Graha secures $25m loan

Bank Artha Graha secures $25m loan

DENPASAR, Bali (JP): Bank Artha Graha secured a US$25 million
syndicated loan yesterday from 13 local and foreign banks.

Bank Artha Graha's president, Anton B.S. Hudaya, said the
five-year loan would carry an annual interest rate 1.4 percent
above the Singapore Inter Bank Offered Rate and be used to
finance an expansion program.

He said the loan's lead arranger was Hong Kong's Asia Capital
Markets, which also provided $2 million of the loan.

The other 12 banks included Bank Negara Indonesia, American
Express Bank, KMBC Asia Limited, Hong Kong's BRI Finance Limited,
Bank Pembangunan Indonesia, Korea's Commercial Bank and Ta Chong
Bank.

The loans will be provided into two packages. The first will
be $5 million and will mature in three years, while the second
will be $20 million and mature in two years.

"This is our first offshore loan and it's expected to increase
our overseas exposure and our financing strength," Anton said.

Bank Artha's total assets were worth Rp 1.11 trillion ($468
million) as of December, 1996, with outstanding credits of Rp 847
billion. Over the same period, the public funds held by the bank
were Rp 909 billion.

Anton said the bank, which had a capital adequacy ratio of
about 9 percent as of December expected its lending to grow by
about 30 percent this year.

He said that in 1996 the bank's pretax profit was Rp 10
billion.

"This year's net profit is expected to grow by around 30
percent," he said.

Anton said that about 60 percent of this year's profit was
expected to come from net interest income and the other 40
percent from fee-based income.

He said the bank planned to launch its initial public offering
this year to raise more funds to finance its expansion.

He said between 30 percent and 40 percent of the bank's
enlarged stock would be sold to the public.

"The bank is ready to enter the stock exchange but we have yet
to receive the go-ahead from shareholders," he said.

Bank Artha is 40 percent owned by army foundation Yayasan
Kartika Eka Paksi, 30 percent by PT Cerna Artha Putra and 30
percent by PT Kartika Nusantara Permai.

He said shareholders were expected to increase the bank's
equity to Rp 150 billion from Rp 113 billion to support the
expansion. (09)