Tiara to offer rights shares

Tiara to offer rights shares

JAKARTA (JP): The publicly listed Bank Tiara will launch an
offering of rights shares later this month to raise fresh funds
of around Rp 75 billion (US$34.88 million).

The bank's president Hendrick Kolonas said yesterday that
around 75 million new shares would be issued during the limited
public offering, which would be held before the end of this
month.

"Existing shareholders are entitled to buy one new share for
each old share they hold at their par value of Rp 1,000 (45 U.S.
cents)," he told investors and securities analysts at the
company's presentation here.

Bank Tiara, currently 33 percent owned by the investing
public, recorded a capital adequacy ratio (CAR) of 14.2 percent
as of Sept. 30, far above the minimum standard of eight percent
set by Bank Indonesia (the central bank).

But Hendrick said that the bank's financing capacity is still
not enough to tap the promising potential in the lending market,
which is expected to record a faster growth next year in line
with the country's growing economic activities.

"We project an increase in our lending of between 60 percent
and 80 percent next year," he said of the bank's business
strategy in benefiting the growing lending market.

Hendrick said that an 80 percent increase in lending is not so
significant when compared to the market's potential. "With an 80
percent rise, each of Bank Tiara's 15 branches will be capable of
providing credits of only Rp 2 billion per month," he said of the
promising opportunities in the country's lending market.

Bank Tiara, which mainly provides credits to the trade and
manufacturing sectors, booked outstanding loans of around Rp 671
billion as of Sept. 30.

The bank's assets, which totaled around Rp 845 billion as of
Sept. 30, is estimated to reach Rp 1.1 trillion by the end of
this year, while its net profit, which reached around Rp 15
billion during the January-September period, is projected to
break the level of Rp 20 billion this year.(hen)