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BTN workers reject acquisition by Mandiri

Thousands of employees of state-lender PT Bank Tabungan Negara (BTN) staged a rally on Sunday to reject the government’s plan to transfer BTN shares to fellow state lender PT Bank Mandiri (Mandiri)

The Jakarta Post
Jakarta
Mon, April 21, 2014

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BTN workers reject acquisition by Mandiri

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housands of employees of state-lender PT Bank Tabungan Negara (BTN) staged a rally on Sunday to reject the government'€™s plan to transfer BTN shares to fellow state lender PT Bank Mandiri (Mandiri).

Rally participants argued that the plan for Mandiri to acquire BTN would only favor Mandiri, the country'€™s largest bank by assets.

BTN workers union chairman Satya Wijayantara said during the gathering that the possible asset merging of the two banks would result in redundancies for BTN employees.

'€œBTN employees would be disadvantaged because if assets were merged, major layoffs would be carried out,'€ he said as quoted by Antara, adding that the government should respect all employees'€™ rights.

Moreover, he lambasted State-Owned Enterprises Minister Dahlan Iskan'€™s opinion that BTN'€™s housing mortgages were not competitive and would be unable to go at it alone.

'€œThe country will lose a housing mortgage bank with this acquisition,'€ Satya said.

'€œMandiri also does not have a subsidized mortgage product for its customers,'€ he added, referring to a government subsidized mortgage program for citizens who have never owned a house and earn less than
Rp 3.5 million (US$306.38) per month.

While admitting that BTN'€™s growth had declined over the past few years, he demanded Dahlan call off the acquisition.

Meanwhile, former coordinating economic minister Rizal Ramli said it would make more sense if another state lender, Bank Rakyat Indonesia (BRI), not Mandiri, acquired BTN.

'€œIf we talk about performance, Mandiri'€™s is below BRI,'€ he said. '€œIf Mandiri wants to be a bigger bank then let it, but leave BTN alone.'€

Likewise, Association of Housing Development in Indonesia (Apersi) deputy chairman Susanto, who also attended the rally, said that the acquisition would be unfavorable to BTN'€™s house mortgage customers.

He said BTN and Mandiri had different market segments; while BTN specialized in housing loans for low to middle income groups, Mandiri served middle and upper customers as well as corporate clients.

'€œWhat will happen to BTN'€™s customers if BTN is acquired by Mandiri?'€ he said.

Representatives of both BTN and Mandiri could not be reached by The Jakarta Post for comment.

The government had, in 2005, also planned for an acquisition of BTN by state lender Bank Negara Indonesia (BNI).

But it dropped the plan after opposition from BTN workers and the House of Representatives, which said the government had no clear vision.

Dahlan said last week that BTN would remain a separate entity after a planned takeover by Mandiri, dismissing rumors that the two would merge.

He said that the acquisition would position the bank as one of the top three in ASEAN. Bank Mandiri is worth Rp 733.1 trillion and BTN Rp 131.17 trillion.

The acquisition, according to Dahlan, would also boost BTN'€™s capacity to provide housing loans.

'€œFrankly speaking, BTN will not be able to meet future housing demands if it relies on its own capacity. Mandiri can help achieve that with its large size,'€ he said.

News and rumors about Mandiri'€™s planned takeover have been circulating over the past three months led to BTN'€™s share price climbing by more than 40 percent, reaching Rp 1,365 last Thursday, from early February. (dwa)

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