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ublicly listed Bank MNC Internasional (MNC Bank) aims to be among the country'€™s upper-mid size lenders in terms of capital in the next five years as it consolidates its business following a recent rights issue, its executives said.

MNC Bank president director Benny Purnomo said the major shareholder was committed to helping the lender reach the BUKU III category, for lenders with a core capital ranging from Rp 5 trillion (US$360 million) to Rp 30 trillion, either in 2019 or 2020. BUKU III lenders are allowed a broader banking services coverage than BUKU II lenders.

According to its third quarter financial report, MNC had Rp 1 trillion in core capital by the end of September. MNC is currently a BUKU II lender, a category for lenders with core capital amounts ranging between Rp 1 trillion and Rp 5 trillion.

'€œOur shareholder stated last year after the acquisition by MNC Group that the aim of enlarging the bank'€™s capital was to enter the BUKU III category,'€ Benny told reporters after a public expose on Wednesday.

Benny said the bank'€™s shareholder would plan several rights share issuances or other fund-raising mechanisms in the next five years to generate at least Rp 3 trillion of new funds to achieve the core capital target.

With the help of a recent rights issue and retained profits, Benny said the bank would see its core capital reach Rp 1.9 trillion and a capital adequacy ratio (CAR) of around 19 to 20 percent by the end of this year, higher than the 13.41 percent as of September.

'€œWe also estimate that our total assets will be between Rp 40 trillion to Rp 50 trillion by 2019, far higher than the Rp 11 trillion currently,'€ Benny said.

In September, MNC Bank won approval from its shareholders to sell 6.7 billion new shares during its fourth rights issue, or about 28.57 percent of its enlarged shares. The bank expected to raise about Rp 674 billion from the rights issue.

The bank officially changed its name to Bank MNC Internasional in October last year as a part of the MNC Group'€™s expansion into the banking industry.

The change of the name came after the acquisition of the bank '€” previously Bank ICB Bumiputera '€” by MNC Kapital, the financial services unit of MNC Group, which is controlled by businessman and politician Hary Tanoesoedibjo.

As of September this year, MNC Kapital controlled 39.88 percent of the bank'€™s stock, while the remaining shares were owned by RBC Singapore '€” Clients A/C (12.7 percent), Citibank Singapore S/A BK Julius Baer & Co. Ltd. (5.38 percent) and the public (42.04 percent).

MNC Kapital is also in the process of discussing a plan to merge MNC Bank with private lender Bank Pundi, which is controlled by Recapital Securities '€” part of the Recapital Group founded by businessmen Rosan P. Roeslani, Sandiaga Uno and Elvin Ramli.

Benny said MNC Bank was also switching its business focus from the corporate to consumer sector, which currently contributes around 45 percent, higher than 37 percent in the same period last year.

'€œThe portion of our corporate sector business has decreased to 49 percent from 55 percent and we hope both corporate and consumer segments will be balanced at 50 percent each,'€ Benny said.

The bank'€™s net profits stood at Rp 7.6 billion as of September, higher than the Rp 20 billion loss in the same period last year. Its loans grew by 16 percent year-on-year to Rp 6.2 trillion as of September, with gross non-performing loans (NPL) decreasing to 3.4 percent from 5.88 percent in the same period last year.