From December 2013, those that see their corporate governance and financial health ratings fall to unacceptable levels for three consecutive reporting periods will have to sell their stakes down to the new limit. (source)
An analyst from OSK Research Sdn Bhd said Malayan Banking Bhd (Maybank) and CIMB Group, which each has over 90 per cent stake in Bank Internasional Indonesia (BII) and CIMB Niaga respectively, are both "very likely" to meet the minimum thresholds stipulated to get exemption from having to sell down their stakes.
Maybank's shares closed one sen higher to RM8.78, while CIMB were unchanged at RM7.90.
"In the pursuit of growth, BII will continuously uphold high standards in risk management, corporate governance and prudent banking practices to ensure its soundness as a financial institution will be recognised by the regulator, thus allowing it to maintain its current shareholding structure, subject to the divestment required by Bapepam - LK.
"BII will also continue to work closely with the regulator and be guided by them in the implementation of this new regulation," its president and chief executive officer Datuk Seri Abdul Wahid Omar said.
When Maybank first bought into BII, it was required by Bapepam, the banking authority, to eventually divest some of its stake in the Indonesian lender.
Other banks in Malaysia such as RHB Capital Bhd and Affin Holdings Bhd have also long waited for Bank Indonesia to come out with its official statement on the new shareholding rules as it may affect their plans to buy lenders there.
Indonesia had been mulling a change in the ownership rules since last year.
Meanwhile, Reuters reported that the cap could pave the way for DBS Group's US$7.2 billion (RM23 billion) bid for PT Bank Danamon to proceed.
The long-awaited regulation is aimed at preventing lenders in the fast-growing G20 country falling captive to single interests and ensuring a diverse shareholder base to hold management accountable, it added.
But the rules, which come on the back of ownership restrictions on mining companies, have fuelled concerns Indonesia is becoming tougher on foreign investment.
After a slew of bankruptcies in the 1998 financial crisis, Indonesian banks have vastly improved their financial health and become a magnet for foreign investment, leading some analysts to speculate the central bank's initial plans for a cap without exemptions were targeted at limiting foreign ownership.
Eight of Indonesia's top 11 banks by market value now are either controlled by foreign banks, business families, private equity firms or wealth funds in one of the region's most open banking sectors.
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