PG Capital, a Texas-California based private equity shop’s joint ownership, with San Diego-based Northstar Pacific Partners, of PT Bank Tabungun Pensiunan Nasional Tbk (BTPN) in Indonesia has bought the American investors into the Islamic finance arena. BTPN is now looking to grow then spin-off its Shari’ah banking unit through acquisition. Indonesian newspaper Bisnis Indonesia has reported that one acquisition target for BTPN is microfinance bank, Sahabat Purba Danarta, currently owned by manufacturing conglomerate Tri-Putra Group. (source)
BTPN’s corporate secretary, Anika Faisal confirmed to The Islamic Globe that the bank was: “Exploring a number of options to spin-off its Shari’ah [compliant] business unit, while maintaining its vision as a bank focused on the mass market segment.”
Faisal confirmed that one option was to acquire a commercial bank then convert it into an Islamic bank, but she declined to comment on any specific targets saying that the bank was at the preliminary stage of negotiations and cited public disclosure regulations imposed on Indonesian PLCs.
The spin-off of the Islamic banking arm by parents TPG and Northstar was planned inpart to comply with the intentions of Bank Negara Indonesia, to grow the Islamic banking industry in Indonesia by forcing banks with over 50% of their assets in Shari’ah-compliant business units to spin-off. BNI has established a deadline of
2023 for the spin-off of all Islamic windows under legislation passed in 2008.
The TPG/Northstar JV also has to negotiate the nearer-term hurdle that will cap foreign ownership of Indonesian banking entities at 50%. The Islamic Globe asked TPG how it was planning to comply with the
newly imposed foreign ownership regulation but the firm declined to comment.
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