TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Maybank plans more financing for infrastructure
Infrastructure fund: Bank Indonesia (BI) director for monetary policy Solikin M
Change Size
Infrastructure fund: Bank Indonesia (BI) director for monetary policy Solikin M. Juhro (right) speaks as Maybank Kim Eng global strategist Sadiq Currimbhoy looks on at a seminar entitled âInvest ASEANâ held by Maybank in Jakarta on Tuesday. The bank of Malaysian origin will fund a government infrastructure program until 2019.(JP/Ricky Yudhistira) (BI) director for monetary policy Solikin M. Juhro (right) speaks as Maybank Kim Eng global strategist Sadiq Currimbhoy looks on at a seminar entitled âInvest ASEANâ held by Maybank in Jakarta on Tuesday. The bank of Malaysian origin will fund a government infrastructure program until 2019.(JP/Ricky Yudhistira)
I
span class="inline inline-center">Infrastructure fund: Bank Indonesia (BI) director for monetary policy Solikin M. Juhro (right) speaks as Maybank Kim Eng global strategist Sadiq Currimbhoy looks on at a seminar entitled 'Invest ASEAN' held by Maybank in Jakarta on Tuesday. The bank of Malaysian origin will fund a government infrastructure program until 2019.(JP/Ricky Yudhistira)
Malaysia-based Malayan Banking Berhad (Maybank) has said it will seek more opportunities to finance infrastructure development in Indonesia through lending and the capital market.
The bank, Malaysia's largest bank and financial group, is confident about Indonesia's long-term outlook despite short-term challenges, as the country is pushing its infrastructure spending to boost economic growth.
Maybank Kim Eng Group CEO John Chong said Indonesia's infrastructure projects would have to look to the capital market for financing, in particular bonds and sukuk (Islamic bonds), as an alternative to bank loans.
'A deep rupiah bond market will enable project sponsors to seek longer-term fixed-rate funding to provide certainty to their financing cost. It will also match the rupiah [revenues] received from these projects,' Chong said at Maybank's Invest ASEAN Indonesia conference on Tuesday.
The government has pledged to drive growth further by increasing infrastructure spending by 8 percent to Rp 314 trillion (US$22.06 billion) from Rp 290 trillion in its proposed 2016 state budget.
Chong said Maybank Group and Maybank Kim Eng had, over the past few years, been actively helping to raise funds from the capital market as well as providing syndicated loans for various infrastructure projects in Indonesia, such as power plants, toll roads and seaports.
At the same event, Bank Maybank Indonesia president director Taswin Zakaria said the lender ' previously Bank Internasional Indonesia (BII) ' would also seek opportunities to increase infrastructure financing, as it already had loan portfolios in smelters, airports, electricity and transportation.
'We have mediated many private and state-owned enterprises to raise funds in various sectors. Collaborations with Maybank Kim Eng and the group will become a big platform to bridge Indonesia and the global market,' Taswin said.
The bank, one of the top 10 lenders in Indonesia, officially changed its name from BII to Bank Maybank Indonesia on Oct. 1 after the Law and Human Rights Ministry and Financial Services Authority (OJK) gave their approval.
The rebranding is part of its major shareholder's bigger plan to strengthen its presence in ASEAN.
As of the end of the first half, the bank had posted Rp 108.5 trillion in lending, an increase of only 2.4 percent from Rp 106 trillion in the same period last year as a result of lackluster economic growth.
As Indonesia improves its infrastructure, Maybank global banking group head Amirul Feisal Wan Zahir said the ASEAN Economic Community (AEC) could help accelerate the country's growth, while also improving its resilience to global shocks.
'Diversifying into a growing ASEAN market will be especially attractive for Indonesian companies amid the current weakness in the local economy,' Feisal said, adding that the AEC would trigger more funding demand from Indonesian companies as they expand their business regionally.
A study conducted by Maybank Kim Eng ' the group's investment banking arm ' found that elimination of trade barriers was one of the key factors in the AEC driving regional growth for the multi-year period, as it would mobilize intra-ASEAN trade and foreign direct investment.
Based on the research, Feisal said ASEAN countries should unify more closely together to increase economic links, build resilience to external shocks and reduce reliance on Western economies.
