Indonesian fintech Investree takes control of 18.4% stake in Bank Amar

Vishal Tulsian, President Director of Amar Bank (left) and Adrian Gunadi, Co-Founder & CEO of Investree Indonesia and CEO of Investree Regional (Photo courtesy of Investree)

Indonesian online peer-to-peer lending platform Investree announced on Friday it has gained control of an 18.4% stake in PT Bank Amar Indonesia Tbk in a bid to serve a bigger pool of customers across the country.

Investree Singapore Pte Ltd, the holding company of the P2P lending platform, spent about 422 billion rupiah ($28.5 million) in June to acquire the shares— representing a 10.9% stake in the Indonesian bank — at 280 rupiah apiece.

DealStreetAsia reported in May that Investree was set up to acquire as much as 19% stake in the publicly listed Indonesian lender as part of efforts to combine Bank Amar’s retail and digital capabilities and Investree’s MSME lending expertise.

Investree concluded the transaction on August 24, according to a filing with the Indonesia Stock Exchange (IDX), buying more than a billion shares from Tolaram Group. In total, Tolaram Group currently controls 8.2 billion shares (59.4%), Investree 2.5 billion shares (18.4%), and the public 3.1 billion shares (22.2%).

“In addition, this acquisition will further enhance Investree’s solid ecosystem, enabling increased strategic potential to empower MSMEs across the country. After this, we hope that we can start carrying out the key initiatives being prepared by the Investree Group and Amar Bank,” Adrian Gunadi, Investree Indonesia co-founder and CEO and Investree regional CEO, said in the statement.

In the same statement, Amar Bank President Director Vishal Tulsian said the transaction would also strengthen the lender’s position as a digital bank. The lender is known for its big data-driven digital consumer and micro business lending called Tunaiku and digital banking called Senyumku.

Tulsian said Bank Amar is “poised to become the strongest MSME-focused digital bank of Indonesia” by combining Investree’s and the lender’s capabilities.

Amar Bank currently employs more than a thousand employees, a significant jump from 17 in 2014. According to its 2021 annual report, Bank Amar has offices in Jakarta and Surabaya while its service covers Jakarta Greater Area and several other big cities in Java, Sumatra and Bali.

Shares of Bank Amar were sold at 292 rupiah apiece at the end of the Friday trading session, jumping 5.80% on the day.

Investree recorded 17.6 trillion rupiah in total loan facility and disbursed loans of 11.3 trillion rupiah as of June 2022. The company also managed to maintain its TKB90 at 97.61%, higher than the industry average of 97.47% in June as reported by Indonesia’s Financial Services Authority (OJK).

TKB90 is a measure of loans settled successfully within 90 days of their due date — the opposite of the more common NPL ratio. The lower the TKB90 number, the higher the NPL levels.

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