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ublicly listed PermataBank will conduct a rights issue worth up to Rp 5.5 trillion (US$407 million) this year to increase its capital in anticipation of an international regulation.

The private lender expects the rights issue, which will be conducted in the first half, will increase its capital adequacy ratio (CAR) from the 15 percent posted in 2015, up from 13.6 percent a year earlier.

PermataBank president director Roy A. Arfandy said the bank expected the move to strengthen the bank'€™s capital base to support business growth and comply with the new Basel III regulations.

'€œWe will continue to be cautiously optimistic in 2016, given the current operating environment, by focusing on improving asset quality, strengthening capital and growing our assets selectively,'€ Roy said in a statement Thursday.

British lender Standard Chartered and diversified conglomerate Astra International currently each hold a 44.6 percent stake in Permata, while the remaining 10.88 percent is owned by the investing public.

Permata announced Thursday that its net profit dropped by 84 percent year-on-year (yoy) to Rp 247 billion as of last year as the country'€™s weak economy had caused a rise in bad loans, which triggered a 212 percent jump in provision expenses.

The bank saw a 3 percent yoy decrease in loans to Rp 128 trillion in 2015, with gross nonperforming loans increasing to 2.74 percent from 1.7 percent a year earlier.