www.theindonesiatoday.com - JAKARTA, Indonesia Today - The central bank, Bank Indonesia (BI), plans to implement multiple license to foreign banks operating in Indonesia, Bisnis Indonesia reported this morning.
Muliaman D. Hadad, BI's governor deputy, said the multiple license implementation is inline with other countries' policies that do not give equal access to Indonesian banks for expansion.
He said BI's plan to limit foreign ownership in local banks will not be implemented in the near term as BI must synchronize with the government's regulation. (source)
But, Muliaman said, BI can award license qualitatively to foreign investors that intend to expand their banking business in Indonesia.
He explains that under the multiple license, BI will give license for opening branch office in Indonesia but the license does not include the operation. Foreign bank needs to get license for operation and other.
Muliaman said Singapore and Malaysia have also implemented the multiple license; principal license and operation license. Both countries also limit the expansion of branch office, including ATM, by foreign banks.
Related to the acquisition of DBS Group Holdings Ltd (Singapore) over PT Bank Danamon Tbk (BDMN), Muliaman said BI requires the implementation of equal business principle between Singapore and Indonesia banking sector.
"The reciprocal principle is a requirement for the transaction (acquisition) to be approved or not," he said.
DBS Group had in April 2, 2012 entered into a share purchase agreement with Fullerton Financial Holdings Pte. Ltd. to acquire 6.45 billion Danamon shares, or 67.37% of the issued shares, owned by Asia Financial Indonesia Pte Ltd.
DBS offers Rp7,000 per share for Danamon shares, then total consideration for the acquisition reaches Rp45.2 trillion. (hans@theindonesiatoday.com)
Source : http://www.theindonesiatoday.com/news/finance/finance-photo/20581-bi-to-implement-multiple-lincense-to-foreign-banks-.html - April 12, 2012
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