BII ready for recapitalization

BII ready for recapitalization

JAKARTA (JP): Publicly listed Bank Internasional Indonesia
(BII) has raised Rp 1.87 trillion (around US$220 million) in
fresh funds to join the government-sponsored bank
recapitalization program.

The bank said here on Tuesday the amount, raised by its recent
limited public offering, was more than the minimum 20 percent of
recapitalization funding the bank must provide under the program.

About Rp 1.55 trillion of the funds were injected by the Sinar
Mas Group and the Widjaya family, the majority shareholders in
BII, while another Rp 321 billion came from local and foreign
investors, the bank said.

The bank added that the total funds raised from the 16-for-one
rights issue amounted to 24 percent of the Rp 7.76 trillion
needed to raise the bank's capital adequacy ratio to the
government-required 4 percent by the end of this year.

"This positive result also implies the government's
contribution of 80 percent (of recapitalization funding), or Rp
6.06 trillion, is now reduced to 75.86 percent, or Rp 5.88
trillion, which is quite a substantial savings for the
government," he said.

The bank said it had fulfilled its commitment to the
recapitalization program and the next step would be to transfer
its bad debts to the asset management unit of the Indonesian Bank
Restructuring Agency.

According to data from the central bank, BII's capital
adequacy ratio as of Dec. 31 was minus 15.69 percent. BII's bad
debt in the same period was Rp 4.922 trillion out of a total of
Rp 16.6 trillion in loans.

BII is one of nine banks which qualified for the government-
sponsored recapitalization program. Under the program, the banks'
shareholders must provide at least 20 percent of the needed
recapitalization funds and the government will provide the other
80 percent through the issuance of bonds.

The other banks in the program are Bank Lippo, Bank Bali, Bank
Bukopin, Bank Niaga, Bank Universal, Bank Prima Express, Bank
Arta Media and Bank Patriot. (hen)