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The State Enterprises Ministry has given its blessing to state-owned PT Bank Rakyat Indonesia’s bid to acquire PT Bank Agroniaga, and called for the deal to be completed quickly to spur lending to the agricultural sector.

“The study for the acquisition has been completed and I hope the process can be accelerated,” Agus Pakpahan, the deputy for agriculture, forestry, paper and printing at the ministry told reporters on Friday. “Bank Agro could be a medium for BRI to increase its lending to the agriculture and plantation sector.”

Micro lending is one of BRI’s core businesses and by buying Bank Agro it would acquire a large number of micro credit customers in the agro-business sector.

BRI expects its micro credit ledning to grow 33 percent this year to Rp 71 trillion ($7.8 billion) compared with Rp 53 trillion in 2009.

Agus said there were some foreign investors interested in acquiring Bank Agro but that the government would prefer BRI to buy the bank, which focuses on lending to the agricultural sector. However, he refused to disclose how big a stake BRI was looking to buy.

Agus is confident that the acquisition will also benefit Bank Agro.

“Their performance is not bad, but it will be optimized if it is under BRI,” he said.

Bank Agro is currently 96.87 percent owned by Dana Pensiun Perkebunan, the state plantation companies’ pension fund.

Roswita Nilakumia, chief commissioner of Bank Agro, said in December that the lender had been negotiating with four potential investors, two of which were domestic, with one from China and one from the Middle East.

This year Bank Agro has forecast a profit of Rp 20 billion, an 124.7 percent increase from Rp 8.9 billion in 2009.

“If approved, the acquisition will likely happen after Bank Agroniaga completes its rights issue scheduled in the second quarter this year,” Rahmi Marina, an analyst from PT Kim Eng Securities, said in a research note released this month.

According to an Antara report, Aviliani, an independent commissioner for BRI, is also supporting the proposed acquisition.

“The acquisition is important because the competition against foreign banks will be tighter in 2011 and therefore state-owned banks have to strengthen their assets,” Aviliani said, adding that the plan will be discussed by BRI shareholders at a meeting in May.

BRI, which has allocated Rp 2 trillion for acquisitions this year, has also been negotiating to acquire a stake in medium-sized lender PT Bank Bukopin.

However, BRI said this month that it would pull out of the race to buy Bank Bukopin if the government prefers state pension fund PT Jaminan Sosial Tenaga Kerja to acquire the bank.