Govt to sell other banks if BNI divestment canceled
The Jakarta Post, Jakarta
The government plans to sell its remaining minority shares in publicly listed Bank Central Asia (BCA), Bank Niaga and Bank Danamon this year if the House of Representatives rejects the Bank BNI divestment plan, according to a senior official.
"If the BNI divestment plan is rejected, we'll have to seek alternative funding sources," said Anggito Abimanyu, head of agency for the analysis of economics, finance and international cooperation at the Ministry of Finance.
He said on Friday that the House had previously given its approval for the sale of the minority shares in the above three banks.
The government has planned to sell a 30 percent stake in publicly listed BNI, the country's third largest bank in terms of assets, to public investors sometime in October in a bid to raise cash to help finance the 2004 state budget deficit. The sale is a key part of this year's privatization program, which aims to raise a total of Rp 5 trillion (US$545.85 million) in cash. So far the government has raised around Rp 3.5 trillion in privatization proceeds.
BCA is the second largest bank in the country, of which 51.43 percent is controlled by investment firm Farindo Investment, while the government owns a 6.48 percent stake. Danamon is the fifth largest bank, and the Singaporean government's investment arm Temasek Holdings controls a 62 percent stake. Meanwhile, Niaga, the ninth largest bank, is 52.8 percent controlled by Malaysia's Commerce-Aset Holdings, with the remainder in the hands of the government and the investing public.
The government has had some difficulty obtaining approval from the House for the BNI divestment program as some lawmakers continued to oppose the plan. The House is scheduled to convene next Tuesday to decide whether it would finally approve or reject the plan.
Elsewhere, Anggito said that the sale of a 51 percent stake in Bank Permata later this year would also raise cash to help finance the state budget.
Currently a number of consortia including top global banks are conducting due diligence process on Permata.