Indonesia's new bank rules may not hit Maybank (1155), CIMB (1023)

KUALA LUMPUR: Indonesia's central bank has
issued new rules limiting single ownership in domestic banks at 40 per
cent but allows exemptions that could let Malaysia's top two lenders
hold on to their controlling stakes in banks there.



Bank Indonesia, in a statement on Wednesday, said public-listed
financial institutions will be allowed to keep their current ownership
structures in Indonesian banks, provided they maintain high levels of
corporate governance and financial health, including a tier-1 capital
ratio of over six per cent.

From
December 2013, those that see their corporate governance and financial
health ratings fall to unacceptable levels for three consecutive
reporting periods will have to sell their stakes down to the new limit.

An
analyst from OSK Research Sdn Bhd said Malayan Banking Bhd (Maybank)
and CIMB Group, which each has over 90 per cent stake in Bank
Internasional Indonesia (BII) and CIMB Niaga respectively, are both
"very likely" to meet the minimum thresholds stipulated to get
exemption from having to sell down their stakes.

Maybank's shares closed one sen higher to RM8.78, while CIMB were unchanged at RM7.90.

[You must be registered and logged in to see this image.]

Maybank, in a statement yesterday, said it was "pleased" with the Bank Indonesia announcement.

"In
the pursuit of growth, BII will continuously uphold high standards in
risk management, corporate governance and prudent banking practices to
ensure its soundness as a financial institution will be recognised by
the regulator, thus allowing it to maintain its current shareholding
structure, subject to the divestment required by Bapepam - LK.

"BII
will also continue to work closely with the regulator and be guided by
them in the implementation of this new regulation," its president and
chief executive officer Datuk Seri Abdul Wahid Omar said.

When
Maybank first bought into BII, it was required by Bapepam, the banking
authority, to eventually divest some of its stake in the Indonesian
lender.

Other banks in Malaysia such as RHB Capital Bhd and
Affin Holdings Bhd have also long waited for Bank Indonesia to come out
with its official statement on the new shareholding rules as it may
affect their plans to buy lenders there.

Indonesia had been mulling a change in the ownership rules since last year.

they are not effected hence no issue with them cause they are exempted