State-owned companies promise higher dividends, stock buyback to help economy

Riska Rahman, Norman Harsono and Adrian Wail Akhlas
The Jakarta Post

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Jakarta / Fri, March 13, 2020 / 05:10 pm

A worker shows electronic money issued by state-owned Bank Mandiri and Bank Negara Indonesia (BNI) in Bandung, West Java, on Sept. 19, 2019. All four state-owned banks have allocated larger dividends earlier than last year as the government struggles with low tax collection and the need to disburse more money to stimulate a cooling economy.(Antara/M Agung Rajasa)

State-owned companies have come to the rescue against the backdrop of a crashing domestic stock market and cash-strapped state budget by promising share buybacks and disbursing higher dividends earlier to cushion the economic impacts of COVID-19. All four state-owned banks have allocated larger dividends earlier than last year as the government struggles with low tax collection and the need to disburse more money to stimulate a cooling economy. The country’s largest bank by assets, publicly listed Bank Rakyat Indonesia (BRI), announced in February its plan to distribute Rp 20.6 trillion (US$1.5 billion) in dividends to its shareholders this year. The dividends are equal to 60 percent of the bank’s profits in 2019, higher than its previous payout ratio of 50 percent. Bank Mandiri also decided to give out bigger dividends this year, with plans to distribute Rp 16.49 tr...

Topics :

state-owned-enterprises bank-mandiri Bank-Rakyat-Indonesia Bank-Negara-Indonesia bank-tabungan-negara dividend profit Sri-Mulyani-Indrawati tax-collection state-budget deficit

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