Bank Negara Indonesia plans launching $1.4bln rights issue

BNI plans a December rights issue after Indonesian government delayed Bank Mandiri's $1.5bln plans until 2011.

PT Bank Negara Indonesia, the nation's No.4 lender, may raise up to 12.49 trillion rupiah ($1.40 billion) in a December rights issue, based on the price range set by the bank on Tuesday.

The state-owned bank's capital raising could be the second biggest rights issues in Indonesia after PT Bakrie & Brothers, controlled by the Bakrie Group, raised about 40 trillion rupiah ($4.49 billion) in 2008.

Rival state-owned lender PT Bank Mandiri, also plans a rights issue and could raise up to $1.5 billion but the government has decided to delay the Mandiri plans until 2011.

BNI set the price range for the rights issue at 2,300 to 3,700 rupiah ($0.26 - $0.41), which represents a discount of between 6.3 percent to 42 percent of the closing share price on Monday at 3,950 rupiah ($0.44).

It had previously planned to raise 6 to 7 trillion rupiah ($673.03 million - $785.19 million), but now sees greater demand from investors who have driven the Jakarta stock market to record highs this year seeking exposure to strong consumer demand in Southeast Asia's biggest economy.

View the full story in Reuters.