BTN’s president director Maryono said the acquisition of PNM-IM was part of the bank’s medium-term plan to expand into other businesses outside the banking sector.

"We want to expand the scope of our business to improve business performances and to support the government’s One Million Houses Program," Maryono said after the signing of the share purchase agreement between Bank BTN and PNM-IM’s parent company, state-owned financing company PT Permodalan Nasional Madani (PNM).

Maryono explained that the new subsidiary would give the company another alternative to raise long-term funds to further support the bank’s lending capacity so it could provide more affordable housing finance schemes for customers. "So, in the end there will be more and more people who can purchase homes,” Maryono said.

In addition, Maryono said the new investment management company was also expected to help increase the bank’s fee-based income. With the investment management company, Bank BTN planned to sell various investment products such as mutual funds and asset backed securities, he added.

Bank BTN signed an agreement on Monday to purchase a 30 percent stake in PNM-IM for Rp 114.3 billion ($8.1 million) as part of an initial conditional share purchase agreement to own a majority of the company by next year. The bank has allocated roughly Rp 1 trillion to finance this inorganic growth.

Maryono estimated that the acquisition alone would reallocate Rp 50 trillion from the government’s public housing savings (Tapera) fund, part of which was managed by PMN-IM, into his bank’s fund pool.

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