Commerce raises Niaga stake to 61.1%

Commerce raises Niaga stake to 61.1%

KUALA LUMPUR: Commerce Asset-Holding Bhd., Malaysia's No. 2
lender by assets, bought 6.53 percent of PT Bank Niaga, raising
its stake in the Indonesian lender for a second time in two weeks
to tap demand for loans in Southeast Asia's biggest economy.

Commerce bought 514 million Niaga shares for 109.2 million
ringgit (US$29 million), boosting its stake to 61.1 percent, it
said in a statement on Tuesday.

Commerce's purchase will "further strengthen its foothold in
the Indonesian financial services market", the Malaysian lender
said. It did not disclose who sold the shares.

Low interest rates and faster economic growth are boosting
demand for credit in Indonesia. The economy is forecast by the
government to expand 5.5 percent this year, the fastest since
1996, up from 5.1 percent growth last year.

Niaga surpassed profit targets in 2004, with net income rising
41 percent to Rp 660 billion ($69.6 million), it said in
February.

Commerce gained management control of Bank Niaga in 2002,
after it bought 51 percent of the lender from the Indonesian
government for Rp 1.057 trillion. It announced the purchase of an
additional 2.09 percent stake on April 13.

The announcement came after the 5 p.m. close of trading in
Kuala Lumpur. Commerce was unchanged at 4.50 ringgit. Niaga fell
1 percent to Rp 475.-- AP