Give investors equal chance of acquiring Permata: Anwar

Dadan Wijaksana, The Jakarta Post, Jakarta

Amid intensified talks of a merger between two of the country's top-ten banks, the central bank has suggested the government give any interested parties, including foreign investors, equal chances of acquiring Bank Permata.

Bank Indonesia senior deputy governor Anwar Nasution said all options -- including open bidding, which allowed the participation of every interested investor -- should be taken into consideration to produce the best possible solution.

"We condone any merger move, as suggested by API (Indonesian Banking Landscape)," Anwar said, referring to a concept recently launched by the central bank which, among others measures, encouraged national banks to merge to strengthen their capital.

"But, should it be dominated by BNI? Why not hold a sort of open bidding in which anybody, including foreigners, could participate?" explained Anwar, adding that open bidding would not only ensure fairness, but also the best results for the banking sector as a whole.

Anwar was replying to questions on the possibility of a merger between BNI (Bank Negara Indonesia) and Permata, both of which are owned by the government via the Office of the State Minister of State Enterprises.

State Minister of State Enterprises Laksamana Sukardi said the office would decide upon the possible merger sometime in September.

The plan first emerged around a month ago when BNI, a leading player in the corporate sector, proposed to the government that it would merge with Permata to help strengthen its financial balance and expand its business to the retail and consumer sector, which is Permata's core strength.

BNI and Permata are the country's second and seventh largest banks respectively in terms of assets. BNI has assets worth Rp 131 trillion (US$19 billion) and Permata, about Rp 30 trillion.

As the merger talks continue, Anwar's remarks should provide a respite for other banks -- both domestic and foreign -- which also have an interest in Permata.

It has been no secret that Permata's solid footing in the retail and consumer sector has drawn much interest from investors, in line with the recent boom in the sector. Permata was formed two years ago from a merger of five ailing banks; Bank Bali, Bank Universal, Bank Arthamedia, Bank Prima Express and Bank Patriot.

Elsewhere, should the merger plan proceed, Anwar suggested the government learn a lesson from previous mergers, which had taken a long time to consolidate.

He cited Bank Mandiri and Bank Danamon, as examples .