OCBC to provide funds to NISP

OCBC to provide funds to NISP

Dow Jones, Jakarta

Overseas-Chinese Banking Corp., Singapore's number three
lender by assets, on Wednesday said it is ready to provide fresh
funds for Bank NISP after it acquired a 22.5 percent stake in the
Indonesian bank.

"In the future, we will be ready to provide fresh funds, if
Bank NISP needs it," OCBC Chief Executive David Conner told
reporters after signing a partnership agreement with the
Indonesian bank.

"We are happy to increase our investment (in Bank NISP)," he
said, adding that the acquisition will position OCBC "for long-
term growth in the large Indonesian market."

He reiterated that OCBC intends to acquire a majority stake in
NISP over time.

"But we don't have any specific time frame," he said.

Meanwhile, Bank NISP President Pramukti Surjaudaja expects the
partnership with OCBC to make his bank more profitable and allow
it to keep up with other banks.

Foreign banks offer expertise and financial muscle to
Indonesian lenders, which, until the 1997-1998 crisis, extended a
majority of their loans to affiliated conglomerates and therefore
have little experience in assessing risk, analysts said.

Bank NISP is also hoping OCBC's entrance will make it easier
for the local bank to raise capital in the future.

"OCBC's image as a reputable bank in the region will help us
issue international bonds at a lower cost," Pramukti said,
adding, however, that the bank has no immediate plans to do so.

Indonesian banks have been attracting interest from Singapore
recently.

Last year, Temasek Holdings and Deutsche Bank AG jointly
bought a 51 percent stake in Indonesia's fifth-largest lender,
Bank Danamon Indonesia, for $350 million.

Meanwhile, United Overseas Bank Ltd., Singapore's No. 2 lender
by assets, is expected to complete a purchase plan for a 23
percent stake in Bank Buana Indonesia by end-May.