OCBC Bank/Bloomberg

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OCBC plans to bid for StanChart-backed Indonesian lender

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Singapore’s second-largest lender is interested in buying the stakes held by Standard Chartered and Astra International.

Wednesday 14, August 2019

Oversea-Chinese Banking Corporation (OCBC) is weighing a bid for a controlling stake in Bank Permata, an Indonesian lender backed by Standard Chartered, reported Bloomberg.

OCBC is considering an offer for almost 90 per cent of the $1.9 billion bank. The London-based bank and the Jakarta-listed conglomerate each own about 44.6 per cent of Permata.

In February, Standard Chartered said that its Permata investment is no longer considered core, signalling it may be getting ready to sell the stake. The lender also named Indonesia among four countries where the bank is focused on reducing costs and engineering a long-awaited turnaround.

OCBC’s deliberations are said to be still at an early stage and may not result in a deal.

Permata, the 11th largest Indonesian bank by assets, reported net income of IDR 711.4 billion ($50 million) for the first half of this year, up from IDR 288.8 billion a year earlier.

Speculation that OCBC is getting ready for another acquisition has been fuelled by its less generous dividend policy when compared with the other Singapore banks. The bank argues the policy ensures a strong capital position which allows it to capture market opportunities when they arise.

OCBC purchased Wing Hang Bank in Hong Kong for $5 billion in 2014, and in 2016 it paid $227.5 million for the wealth assets of Barclays in Singapore and Hong Kong.

OCBC already has a presence in Indonesia through its stake of about 85 per cent in Bank OCBC NISP.


TAGS : Standard Chartered, OCBC, Astra International, Bank Permata, Wing Hang Bank, Bank OCBC NISP

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