Shareholders approve NISP's stake sale

Shareholders approve NISP's stake sale

Leony Aurora, The Jakarta Post, Jakarta

Shareholders of Indonesia's NISP bank have approved the sale of a
28.5 percent of stake to the Overseas-Chinese Banking Corporation
Ltd. (OCBC), making the Singapore-based company the majority
shareholder.

The purchase would give OCBC a controlling 51 percent stake in
the bank, NISP's president director Pramukti Surjaudaja said in
an extraordinary shareholders meeting on Thursday.

"The shares will be sold at 2.5 times of the book value stated
on the bank's latest financial report, after the sale is approved
by Bank Indonesia (BI)," Pramukti said.

Based on the bank's book value in December, OCBC -- through
its subsidiary OCBC Overseas Investment Pte. Ltd. (OOI) -- will
have to spend about Rp 992.62 billion (US$107.89 million) for the
acquisition of over 1.1 trillion shares at about Rp 842.5 each.

"There may be an increase in March or April," said Pramukti,
referring to the time when the purchase is expected to take
place.

After the sale is approved by the central bank, OOI will
execute a tender offer for the remaining shares at the same
price, as required by the regulations.

"We don't have any specific target for how many more shares to
acquire. What's important is that we have a simple majority,"
OCBC executive vice president Linus Goh said.

Goh said OCBC would not make any dramatic changes to its
future subsidiary. "We are very comfortable with NISP's vision
and mission," he said.

According to its latest financial report from September last
year, OCBC has 112 branches in 14 countries, including one in
Indonesia, with total assets of $73 billion.

With such a strong partner, NISP may expand more rapidly to
reach larger markets in Indonesia. "We aim to have NISP become
one of the five top private banks," said Goh.

The Singaporean lender first entered the Bandung-based bank
last year by acquiring 22.5 percent of stakes at $73.1 million.

NISP's other shareholders include founder the Surjaudaja
family, the World Bank's financing arm, the International Finance
Corporation and public investors.

"After the stake sale, our shares will be between 5 percent
and 10 percent," Pramukti said.

As of Dec. 31 last year, NISP recorded an unaudited 63 percent
increase in net profit to Rp 288.1 billion from Rp 176.7 billion
it posted in the same period the previous year on stronger
lending.

Net interest income grew to Rp 642 billion in 2004 from Rp 449
billion in 2003, while its loan-to-deposit ratio stood at 76.73
percent. Its total assets stood at Rp 17.79 trillion.