HK transfers banking license to Bank Mandiri

HK transfers banking license to Bank Mandiri

HONG KONG (AFP): The Hong Kong Monetary Authority (HKMA) said Monday that it had transferred the restricted banking license of PT Bank Pembangunan Indonesia to PT Bank Mandiri, a new super- bank.

Last week Mandiri was formed out of the merger of four Indonesian state banks: Bank Bumi Daya, Bank Dagang Negara, Bank Ekspor Impor Indonesia and Bank Pembangunan Indonesia.

A spokesman for the HKMA, Hong Kong's de facto central bank, said the grant of transfer took effect on Saturday following the creation of Bank Mandiri, which on Monday opened for business in Jakarta.

The four failed banks were collectively known as the "Legacy Banks," and the spokesman said the transfer would enable Mandiri to continue their restricted banking activities in Hong Kong.

Previously, the business of the Legacy Banks was conducted through the Hong Kong branch of Bank Pembangunan Indonesia and two deposit-taking companies, Staco International Finance Ltd. and Bumi Daya International Ltd.

As a restricted-license bank, the Hong Kong branch of the state-owned Bank Mandiri will focus on trade financing and corporate lending, which were the Legacy Banks' core business activities in Hong Kong.

The new bank is the result of more than nine months of intensive restructuring and reorganization of key operating divisions.

Mandiri said in a statement that it would continue a restructuring drive at the Legacy Banks' network across Indonesia, aiming to cut their total number of branches from 700 to 529 Mandiri outlets.

The Indonesian government has agreed to recapitalize Bank Mandiri through staged bond issues worth up to Rp 137.8 trillion (about US$20.4 billion).

Mandiri president Robby Djohan last Thursday told a news conference he expected strong growth for the new bank's productive assets.

"We believe we will probably this year ... grow by about 10 to 12 percent," Djohan said.