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ICD moves ahead with plans to acquire BNI's sharia unit
Dubai-based Islamic Corporation for the Development of the Private Sector (ICD) says it will go ahead with plans to acquire the sharia unit of Bank Negara Indonesia
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Dubai-based Islamic Corporation for the Development of the Private Sector (ICD) says it will go ahead with plans to acquire the sharia unit of Bank Negara Indonesia.
The ICD said Tuesday it is still committed to executing the plan later on this year, to establish a major sharia bank in Indonesia, despite the global financial crisis.
"Our intention is (to establish the bank) sometime this year. The crisis hasn't changed our resolve; although the crisis has forced everybody to reasses the situation, we're 100 percent committed to this project," said ICD chief executive officer Khaled M. Al-Aboodi.
Al-Aboodi said the ICD would bring other investors, especially from the Middle East, to invest in the BNI's sharia unit.
He added the new sharia bank would focus on "not only retail, but also corporate and investment" banking. "We'll provide a wholesale bank that supports businesses and individuals as well."
ICD will inject US$450 million in funds to set up the new sharia bank. As BNI's sharia unit has a capital of Rp 500 billion ($41.49 million), the new bank's capital will reach around $500 million.
"We'd like to make an impact. Small banks cannot make an impact."
The central bank has announced it would cut the minimum capital requirement for banks seeking to spin off their sharia units to Rp 500 billion from Rp 1 trillion previously.
BNI president director Gatot Suwondo has said the bank would spin off its sharia unit as soon as the regulations come into effect.
ICD has so far invested in a number of companies and projects in the country, most of which went to PT Power Telecom (PowerTel) and PT Mandala Multifinance.
Mandala received $8 million to fund its program for micro and small sized enterprises, and increased its capital base. PowerTel will receive about $50 million in phases for the development of fiber optic projects, said PowerTel deputy president director Temi Efendi.
PowerTel, owned by the Tjokrosaputro family, has always been in the red since it was established in 2004.
The Tjokrosaputro family owned Bank Pikko, before it was merged with Bank Century, which was then taken over by the government last year amid financial distress.
ICD said it was looking at other projects worth $82 million in total.
"We're interested in the financial sector, modern manufacture, infrastructure. We've looked at some of the projects, but we're looking for some regulations to be more clear, on the tollroads for example," said Al-Aboodi.
