Govt to finance agricultural bank

Govt to finance agricultural bank

JAKARTA (ANTARA): The government will provide 70 percent of
the about Rp 3.5 trillion (about US$465 million) needed to
operate the planned agricultural bank, a minister said.

Minister of Agriculture Soleh Solahuddin said the other 30
percent, or about Rp 1.05 trillion, was expected to come from
either local or foreign investors

"We need the Rp 3.5 trillion to meet the minimum capital
adequate ratio (CAR) requirement set by Bank Indonesia," Soleh
said on Thursday.

He said the government would issue bonds to finance its share
in the agricultural bank, which is expected to begin operations
early next year.

The minister said publicly listed Bank Duta, which has been
appointed to operate the bank, would inject Rp 200 billion into
the planned bank.

A government committee recently established to prepare the
agricultural bank for operation will seek additional funding from
foreign financial institutions, he said.

"The team will seek to establish a cooperation with a French
agricultural bank," Soleh said, adding that the committee would
travel to France this week to discuss the possible cooperation.

Soleh said two Singapore investors, Minareth Mudharabbath
Investment and Megamas Offshore Investment, also had expressed
interest in providing $100 million each to finance the
agricultural bank. (03)