Bank Bali needs Rp 1.4t for recapitalization
JAKARTA (JP): Publicly listed Bank Bali announced on Wednesday that its capital adequacy ratio (CAR) was minus 8.17 percent, based on a financial audit conducted by international auditors.
The bank said that it needed a total of Rp 1.4 trillion to bring its CAR level to the 4 percent minimum requirement set by the government.
The government requires all of the country's 200 commercial banks to have a minimum 4 percent CAR level by the end of this year. The recapitalization process must be completed by March 1999.
Banks with a CAR level of between minus 25 percent and less than 4 percent are eligible to join the government bank recapitalization program, in which the government will provide up to 80 percent of the funding requirement via the issuance of bonds.
The government announced recently that 49 private banks were eligible to join the recapitalization program. These banks must submit business plans in 30 days to join the program.
Bank Bali president Rudy Ramli said, "We have made our business plans for up to 2001 and they have been handed over to Bank Indonesia."
Bank Bali plans to make a rights issue before March 1999 as part of its recapitalization program.
In the middle of this year, the bank appointed financial advisor JP Morgan to help in getting foreign strategic investors to participate in the recapitalization program.
"Out of 12 interested foreign investors, a few big ones have made further moves. But the results of searching for a strategic partner are not yet final because the process is not simple," Rudy said. (rei)