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BNI Syariah seeks Rp 750b from sukuk issuance
Partners: Bank Negara Indonesia (BNI) president director Achmad Baiquni (right) with Perum Jaminan Kredit Indonesia (Jamkrindo) president director Diding S
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span class="inline inline-center">Partners: Bank Negara Indonesia (BNI) president director Achmad Baiquni (right) with Perum Jaminan Kredit Indonesia (Jamkrindo) president director Diding S. Anwar (left), Jamkrindo director Bakti Prasetyo (second from left) and BNI director Sutanto (second from right) pose after a partnership signing event in the maritime sector in Jakarta on Wednesday. BNI has teamed up with Perum Jamkrindo to guarantee working-capital loans for fishery cooperative Mina Rizki Abadi. Antara/Puspa Perwitasari
Sharia lender BNI Syariah, a subsidiary of Bank Negara Indonesia (BNI), hopes to generate up to Rp 750 billion (US$57.8 million) of funds from its upcoming Islamic bond, or sukuk, issuance that it will use to support financing expansion this year.
BNI Syariah president director Dinno Indiano said on Wednesday the lender would offer the debt papers in the form of sukuk mudharabah, meaning that investors will have a joint partnership with the bank and obtain profits in a profit-sharing agreement.
'Underlying the sukuk is our own financing. We aim to boost our productive financing to about 60 percent of our total financing portfolio in the next three years,' he said, adding that the productive segment only accounted for 48 percent at the moment.
The sukuk issuance will be BNI Syariah's first attempt at raising funds from the capital market. The Islamic bond will offer between 8.75 percent and 9.75 percent in profit-sharing percentage and will mature after three years. The debt papers have also obtained an AA+ rating from local rating agency PT Pefindo, as stated in the bond prospectus.
The lender has assigned state securities houses PT Danareksa Sekuritas and PT BNI Securities as underwriters for the sukuk issuance and it is slated to offer the sukuk on May 18 and 19.
BNI Syariah business director Imam Teguh Saptono said the bond would enable the lender to match its short-term funding ' which is currently dominated by one-year time deposits ' with long-term financing.
Besides the productive segment, its financing currently covers the consumer segment as well, mostly represented by mortgages.
This year, the lender hopes to book at least 25 percent growth in outstanding financing to reach Rp 18.8 billion and to maintain its financing-to-deposit ratio (FDR) at between 90 percent and 92 percent.
With such a growth rate, BNI Syariah will most likely need new capital injections either in 2016 or 2017 to support its business expansion, according to Dinno.
'We obtained Rp 500 billion-worth of fresh funds as capital from parent company BNI last year. That boosted our CAR [capital adequacy ratio] to 18.5 percent,' he said.
However, the ratio has since fallen to 15.8 percent because the lender must allocate a certain amount of capital to meet the Financial Services Authority's (OJK) requirements on operational risk.
'Last year's growth rate of 34 percent played a part as well in the CAR decline,' Dinno added.
BNI Syariah may opt to go public in its effort to raise capital if parent company BNI decides not to inject additional capital in 2016 or 2017.
Meanwhile, Imam said that it expected to see its third-party funds or customer deposits increase 25 percent year-on-year to Rp 20.3 billion by the end of 2015.
It hopes to see its CASA ' composing savings and demand deposits ' account for half of the deposits, supported by its haj saving product and new ATM card dedicated for migrant workers in Hong Kong.
