BI approves Niaga divestment plan

BI approves Niaga divestment plan

Bank Indonesia on Wednesday approved the sale of a 51 percent
stake in Bank Niaga to Malaysia's Commerce Asset Holding Bhd. for
around US$120 million.

"Bank Indonesia considers that Commerce Asset Holding is
qualified to buy Niaga stake," Maman Sumantri, a deputy governor
at the central bank, told reporters.

The central bank's approval makes it likely the deal will now
go through.

Some members of the House of Representatives have tried to
block the completion of the sale since the Indonesian Bank
Restructuring Agency (IBRA) reached an agreement with Commerce
Asset Holding last month. Legislators claimed the price for the
sale was too low compared with market prices.

But the House's financial committee has given its approval to
the deal. The House has a powerful but ill-defined role in
Indonesia's new democracy.

Commerce Asset Holding, one of Malaysia's largest banks, bid
Rp 1.057 trillion for the stake, which translates to Rp 26.5 a
share. -- Dow Jones