PT Bank MNC Internasional (MNC Bank) Tbk (BCAP) is looking to raise Rp 1 trillion ($76 million) from a rights issue and series III warrants to strengthen its capital structure.
The private lender has received shareholder approval for the same last week.
In the rights offering, MNC Bank will sell about 5.3 billion shares to existing shareholders at Rp 100 per unit. Proceeds from the rights issue are expected to reach Rp 531 billion ($40.6 million).
Meanwhile, the series III warrants is estimated to bring another Rp 531 billion and will be offered at the same price.
“A stronger capital structure will help the company improve productive assets, boost credit, widen market, thus increasing our income and financial performances,” said MNC Bank president director Benny Purnomo in Jakarta.
He said the bank aims to have a core capital above Rp 5 trillion ($381 million) by 2020, making it eligible to be a member of BUKU III category (groupings that divide lenders according to their core capital).
To achieve the target, the bank is on the prowl to acquire or merge with small to medium-sized banks. He said the plan has been included in the banking business plan (RBB) proposed to the Indonesian Financial Services Authority (OJK) this year.
“I personally want the transaction to take place as soon as possible. But we are still scouring for potential banks with a focus on the consumer segment,” Purnomo said.
This year, MNC Bank has set aside approximately Rp 250 billion ($19 million) for capital expenditure, about half of which (Rp 100 billion ($ 7.6 million) would be allocated for developing digital banking, Purnomo revealed.
He said, the company chooses to focus on digitizing its services to win young, tech-savvy customers.
“We are building five to six mobile apps to cater to various banking services. Two of those digital services have received permit from the OJK,” Purnomo said.
“They are mobile banking and internet banking corporation. We hope to launch these services soon.”
MNC Group acquired MNC Bank in 2014, then named PT Bank ICB Bumiputera TBk (BABP). It operates through 78 branch offices throughout the country.
In 2015, MNC Bank’s total asset was recorded at Rp 12.1 trillion, which was a 28.69 per cent increase from Rp 9.42 trillion in the previous year. Disbursed credit reached Rp 7.1 trillion or grew 13.23 per cent from Rp 6.3 trillion.