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ublicly listed lender BRI Agro, a subsidiary of state-owned Bank Rakyat Indonesia (BRI), seeks to release more shares to the public to comply with stock market regulations.

BRI Agro president director Heru Sukanto said the bank was expecting its mother company to endorse the plan and divest shares to meet the 7.5 percent free-float requirement set by Indonesia Stock Exchange (IDX).

'€œOur public shares portion is still small, and we are convinced that BRI will divest some from its current stake in order to comply with the bourse regulation,'€ Heru said on Tuesday.

The bourse'€™s 7.5 percent free-float requirement was put in place in January 2014, and all publicly listed firms were given two years to comply with it.

Heru said the bank'€™s mother company would probably wait for better conditions in the country'€™s stock market, which was experiencing volatility due to global uncertainty, before deciding to divest some of its stake.

BRI holds a 87.23 percent stake in BRI Agro as of August, while the Dapenbun pension fund owns 9.2 percent and the remaining 3.67 percent is held by the public.

The stake owned by BRI has increased from 80.42 percent prior to BRI Agro'€™s rights issue worth Rp 555.8 billion (about US$41 million) in June, when the state-owned bank used its rights as a standby buyer for its subsidiary'€™s corporate action.

The rights issue helped BRI Agro increase its capital adequacy ratio (CAR) to 23.3 percent as of September from 19 percent at the end of last year, to support loan growth.

'€œFor the time being, we have no further plans for a rights issue or for seeking additional capital injection, because our current CAR is sufficient to help grow our loans,'€ Heru said.

The bank has Rp 1.26 trillion in total capital as of September, up from Rp 851.4 billion at the end of last year. In the third quarter, its tier-one capital amounted to Rp 1.3 trillion, categorizing it as a BUKU II bank, which comprises banks with core capital of more than Rp 1 trillion.

BRI Agro, which disburses most of its loans to plantation and agriculture businesses, booked a 22 percent increase in loans to Rp 5.62 trillion as of September, up from Rp 4.54 trillion in the same period last year.

The growth in loans contributed to the 2.48 percent increase in net profit to Rp 53.03 billion as of September from Rp 40.17 billion in the same period last year.

Profit growth was under some pressure due to the increase in loan-loss provisions, as the weak economy triggered the bank'€™s gross non-performing loan (NPL) rate to rise to 2.46 percent by the end of the third quarter, up from 1.79 percent in the same period last year.

Also on Tuesday, BRI, Indonesia'€™s most profitable lender, commemorated its 12-year anniversary as a listed company.

BRI corporate secretary Hari Siaga Amijarso said the bank had the second-largest market capitalization among financial-sector companies listed on the bourse, as it saw its market cap increase 24 times since its 2003 initial public offering (IPO) to Rp 263.9 trillion as of Nov. 6.