Astra Sedaya secures $92m loan despite credit crunch

Sat, 10/11/2008 11:26 AM | Business

PT Astra Sedaya Finance (ASF), a subsidiary of diversified business giant PT Astra International that focuses on vehicle financing, has secured US$92 million in a syndicated loan from seven banks.

"It's a three-year deal with an interest rate of 2 percent below the (London Inter Bank Offer Rate)," ASF president director Benny Thoeng said in a media statement released Friday.

The lending providers are Bank of Tokyo-Mitsubishi UFJ, Chinatrust Commercial Bank, Mizuho Corporate Bank, Sumitomo Mitsui Banking Corp, Export-Import Bank Tiongkok, Bank of China and Mega International Commercial Bank.

"The credit agreement took place earlier today in Jakarta," he said, saying that the loans would largely be spent to strengthen the firm's lending activities in the final two and a half months of the year.

Commenting on the recent rise in the Bank Indonesia (BI) benchmark interest rate to 9.5 percent, Benny said the company had anticipated this and had no plan to raise its lending rates.

The Indonesian Automotive Industry Association (Gaikindo) earlier this week projected that full-year car sales would exceed the target of 580,000 units despite the current high interest rate climate.

Last year, 434,449 cars were sold, a significant increase from 318,901 the year before.

In Indonesia, up to 70 percent of car sales are financed by loans, according to Gaikindo.

Within Astra Group, Astra Sedaya is grouped under Astra Credit Companies (ACC).

Benny expects ACC to lend Rp 13.5 trillion (around US$1.4 billion) by the end of the year, exceeding it's orginal target of Rp 12.5 trillion.

If realized as planned, this would represent a 38 percent rise on last year. -- JP/Olivia Dameriap

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