Govt raises $65m from Niaga sale
The Jakarta Post, Jakarta
The government has raised around Rp 585.8 billion (US$65 million) from the sale of a 16.8 percent stake in publicly listed Bank Niaga on Tuesday.
Ministry of Finance's asset management company PPA said that the government sold some 1.27 billion shares at Rp 460 per share.
Proceeds from the sale would be used to finance the 2004 state budget deficit.
Minister of Finance Yusuf Anwar has said that this year's deficit was expected to widen to 1.5 percent of gross domestic product compared to the original target of 1.3 percent of GDP (about Rp 26.5 trillion) mainly due to soaring fuel subsidy costs as oil prices remain at record levels.
The Niaga sale follows the recent divestment of government's 51 percent stake in Bank Permata and a 10 percent stake in Bank Danamon. Proceeds from the two sales total Rp 4.51 trillion ($495 million).
The government is now planning to sell another 20 percent stake in Permata and minority shares in other listed banks such as Bank Central Asia (BCA), and Bank International Indonesia.
The PPA has been targeted raising about Rp 12.5 trillion in cash this year to help finance the state budget.
The government owns shares in several listed banks after its spent billions of dollars worth of bonds to bail banks following the late 1990s financial crisis. During the past few years, the government gradually divested its ownership in the banks.
Bank Niaga shares were suspended by the Jakarta Stock Exchange on Tuesday. Niaga's share price, which has risen by more than 31 percent this year, fell by Rp 10, or 2.3 percent to Rp 460 at the close of the stock market on Monday.
The divestment of the Niaga shares were managed by UBS AG and PT Danareksa Sekuritas.
Bank Niaga, the country's ninth largest lender, has forecast profit to rise to Rp 500 billion this year from Rp 467.3 billion last year.
Niaga's net income increased to Rp 435 billion in the first nine months of the year from Rp 330 billion in the year earlier period. The bank is partly owned by Malaysia's Commerce Asset- Holding Bhd.