Mashill needs Rp 300b to meet CAR terms

JAKARTA (JP): Bank Mashill will need Rp 300 billion in fresh capital to meet the 4 percent capital adequacy ratio (CAR) mandated by the government for all publicly listed banks by March, its executives said on Wednesday.

Mashill president Dradjat Bagus Prasetyo disclosed to reporters that his bank fell into the category which qualified it for official assistance under the government's banking recapitalization program.

During the press conference, Dradjat was initially reluctant to disclose Mashill's CAR, but eventually relented and said the ratio was approximately minus 15 percent.

The final figure must await the result of the diligence report prepared by foreign auditors, he added.

Banks with CAR of between minus 25 percent and 4 percent qualify for the recapitalization program. The CAR compares the bank's equity capital with its risk-weighted assets.

Under the program, the government would provide 80 percent of the funding through the issuance of bonds and the remaining 20 percent would have to be raised by existing shareholders of the banks concerned.

Dradjat said Mashill hoped to meet its 20 percent obligation through right issues.

Another Mashill director, Maruba Sihaloho, said the recapitalization process would be completed before the March 31 deadline.

Maruba said the merger process with PT Jayabank International, PT Bank Ciputra, and PT Bank Artamedia would also be completed by March.

"In this merger Mashill will be the surviving bank," he said, saying the new bank will retain the name Mashill. (02)