Japan’s SMFG keen to buy bank in Indonesia after losing Permata bid last year

REUTERS/Beawiharta

Japan’s second-largest lender Sumitomo Mitsui Financial Group Inc is eager to buy a commercial bank in Indonesia, its chief executive said, after a “painful” defeat last year in vying for mid-sized lender PT Bank Permata.

The comment by CEO Jun Ohta comes as Japanese banks have been struggling with ultra-low interest rates at home, with SMFG seeking opportunities outside Japan, particularly in Southeast Asia.

Speaking with Reuters, Ohta said there would be no significant changes in his strategy in Asia even after the COVID-19 outbreak, as he still expects the region to show stronger economic growth.

Indonesia, where SMFG last year completed the purchase of PT Bank Tabungan Pensiunan Nasional Tbk, is a key market for the Japanese lender.

However, it lost out late last year to Thailand’s Bangkok Bank in bidding for Permata, which had a strong client base of small-to-mid-sized enterprises and middle-income retail customers.

“That was painful. I thought we could win,” said Ohta, adding that the lender couldn’t agree on a purchase price. “We will consider the next target if there is something like Permata, as our banking platform in Indonesia is incomplete.”

SMFG will also look to expands its business in markets including the Philippines, Vietnam and India, he said.

The Japanese financial group has less flexibility in its merger and acquisition (M&A) strategy in the United States, as its banking arm was ordered last year by the U.S. Federal Reserve to improve measures against money laundering.

That put a limit on its M&A activity, and it’s still unclear when the restriction will be lifted.

“I’m considering something that could complement (the brokerage arm) SMBC Nikko Securities to strengthen business such as equity capital markets, although we cannot do it right now,” said Ohta.

Reuters

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.