Fri, 14 Feb 2003

Laksamana to promote Danamon in London

The Jakarta Post, Jakarta

State Minister of State Enterprises Laksamana Sukardi and Indonesian Bank Restructuring Agency (IBRA) chairman Syafruddin Temenggung will meet with European investors in London on Friday to interest buyers in a majority stake in publicly-listed Bank Danamon.

IBRA deputy chairman I Nyoman Sender said on Thursday that the overseas trip was part of an international roadshow to test the market's appetite toward Bank Danamon.

The government is trying to sell a 51 percent stake in the bank to strategic investors and another 20 percent via the stock market.

The sale process is expected to be completed this year.

The government, via IBRA, currently owns a 99.4 percent stake in the bank, in return for around Rp 47 trillion-worth in bailout funds. The agency came to the bank's rescue at the height of the financial crisis in the late 1990s.

The bank is currently rated among the country's top ten.

Sender earlier led a team to Hong Kong and Singapore as part of the Bank Danamon roadshow.

The overseas roadshows prove the government's determination to sell the Bank Danamon stake this year, despite protests from lawmakers.

A banking subcommission at the House of Representatives earlier urged the government to delay the Bank Danamon sale, citing currently unfavorable market conditions and the absence of legislation governing the sale of state assets and the privatization program.

They argued that a better investment climate would increase investor confidence in the country and help ensure better bidding prices.

IBRA is mandated to sell government shares in banks as part of efforts to restructure the banking industry while also raising cash to help finance the state budget deficit.

Selling off the Bank Danamon stake this year is also in compliance with what has been agreed to with the International Monetary Fund (IMF).