Bank Permata to Sell Rp 1.8t in Bonds
Bank Permata, partly controlled by Standard Chartered Bank, aims to raise Rp 1.8 trillion ($188 million) from the sale of bonds later this month as it wants to raise funds to boost its capital.
The Jakarta-based lender plans to offer the notes — called subordinated bonds — to investors on Dec. 13 and 14 and plans to list on the Indonesia Stock Exchange (IDX) on Dec. 20, the company said in a statement released in Jakarta on Tuesday.
The sale is part of the lender’s bigger plan to raise Rp 2.5 trillion over two years. Bank Permata raised Rp 700 billion from debt sales in the first half of this year.
The lender selected Standard Chartered Securities Indonesia, Mandiri Sekuritas, Indo Premier Securities and OSK Nusadana Securities Indonesia to handle the debt sale.
Borrowing costs have been kept at record low rates in Indonesia and many local companies are looking to benefit with bond sales.
Bank Pan Indonesia, the country’s seventh-largest lender by assets, plans to sell Rp 4 trillion from bonds later this month.
The Jakarta-based Bank Panin is offering Rp 3 trillion in five-year bonds to investors on Dec. 13 and 14. The lender will also offer Rp 1 trillion in seven-year subordinated bonds to investors on the same dates. Bank Panin plans to list the bonds on the IDX on Dec. 20, the company said in a prospectus last week.
A new banking ruling by the country’s central bank has also pushed lenders to strengthen their capital.
Bank Indonesia announced on Monday a new ruling on minimum capital requirements to better cope with the varying risk profiles of the country’s lenders.
Under the existing regulation, Indonesian banks must have a minimum capital adequacy ratio — a ratio used to measure the lender’s health — of 8 percent, regardless the banks’ risk profile.
Under the new rule, the central bank will divide the country’s commercial lenders into five groups, based on their risk. The required CAR will remain at 8 percent for banks with the soundest risk profile. For banks with the second and third ranked risk profiles, the central bank will require a minimum ratio of 9 and 10 percent, respectively. Bank Indonesia updates banks’ risk profiles every six months.
Net income at Bank Permata rose 16 percent to Rp 1.09 trillion from January to September, the company said in the statement.
Shares in Bank Permata fell 2.1 percent to close at Rp 1,390 on the IDX on Tuesday.