Tycoon eyes StanChart's Indonesia bank stake in march to top

Jakarta

INDONESIAN business tycoon Tahir is keen to gain control of PT Bank Permata, a larger rival to his PT Bank Mayapada International, as he seeks to put his lender in the ranks of the nation's biggest banks.

Mr Tahir's Mayapada Group wants to buy the 90 per cent of Permata that is owned by Standard Chartered plc and PT Astra International, and merge it with Bank Mayapada to create Indonesia's largest non-government bank by assets after PT Bank Central Asia (BCA), he said. The group has been buying shares of Permata from the market since November, said Mr Tahir, who uses only one name. Standard Chartered and Astra own 45 per cent each in Permata.

A merger will help Mr Tahir, whose businesses range from health care to media and real estate, to expand Bank Mayapada's footprint and compete more effectively with state-run lenders and BCA. He is betting that financial services will be among the businesses best placed to benefit from the expansion in South-east Asia's largest economy, and said that he is confident of tackling a surge in bad loans at Permata that has weighed on the stock's performance.

"Permata, in my guess, is facing a tough time on the nonperforming loans," he said in an interview at his office in South Jakarta. "I don't see the reason why Standard Chartered needs to keep Permata. My strategy is, if the shareholders of Bank Mayapada can have a chance to buy out Bank Permata, then it must be merged with Bank Mayapada."

Permata is Indonesia's fifth largest private sector bank, with assets of 171 trillion rupiah (S$18.2 billion). Its gross non-performing loans ratio was 4.9 per cent in the quarter ended Sept 30, according to its website. That is higher than the 3.2 per cent average among the nation's top banks, Financial Services Authority data show. Mayapada's ratio stood at 2.4 per cent at the end of September, according to Indonesia Stock Exchange figures.

Moody's Investors Service said on Feb 9 that pressure on Permata's negative outlook remained because of deteriorating asset quality and profitability, as well as uncertainties over future support from its existing key shareholders. BLOOMBERG