IFC mulls $15m equity investment in PT Bank KEB Hana Indonesia

Indonesia. Photo by Nuh Rizqi on Pexels.

International Finance Corporation (IFC), a member of the World Bank, is considering an equity investment of up to IDR 216 billion (about $15 million) in Jakarta-headquartered PT Bank KEB Hana Indonesia (KHI).

The mid-size bank has an asset base of IDR 40,654 billion ($2.7 billion) and operates 61 branches in the country.

IFC already holds a 9.98 per cent stake in KHI and holds a pre-emptive right to subscribe to new shares to maintain its holding. It has proposed to make the additional equity investment via a rights issue.

In a disclosure, IFC noted that the proposed financing will help the Indonesian bank invest in digital infrastructure and create the distribution and service channels to extend its lending services to a larger segment of users, especially small and medium enterprises (SMEs).

“The SME sector is underbanked and characterized by a relatively low level of debt. SMEs refrain from bank borrowing due to the high collateral requirements, complex procedures, stringent operational and reporting requirements and high interest rates. KHI plans to address this gap by prudently increasing provision of finance to un/underbanked SMEs in Indonesia in a structured, innovative, efficient and sustainable manner,” IFC added in its disclosure.

KHI’s other shareholders are KEB Hana Bank (KHB), which owns 89.01 per cent of the mid-size lender, and individual investor Bambang Setijo (1.01 per cent). KHB is a wholly owned subsidiary of Hana Financial Group, a major player in Korea’s banking industry.

IFC and Hana Financial Group had in December 2007 acquired a small local bank, PT Bank Bintang Manunggal, that later became PT Bank Hana Indonesia. The development finance institution made follow-on investments in KHI via participation in rights issues and through the extension of a long-term loan.

IFC recently announced that it has committed $3.4 billion in the fiscal year 2018 to countries in East Asia and the Pacific. The commitment includes $2 billion of financing from its own account and $1.4 billion raised from other investors, per an IFC statement.

IFC includes the following countries in East Asia and the Pacific — Cambodia, China, Fiji, Indonesia, Japan, Korea, Lao PDR, Mongolia, Myanmar, Papua New Guinea, Philippines, Singapore, Solomon Islands, Thailand, Timor-Leste and Vietnam.

Also Read:

IFC says committed $3.4b to East Asia & Pacific in 2018 to foster pvt sector growth

Indonesia’s realty major Ciputra Group to merge three publicly-listed units

World Bank to provide $10b, ADB $600m to support Indonesia’s energy, infra project

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.