TRADE FINANCE | Cesar Tordesillas, Indonesia

OCBC NISP eyes $163.5M through rights shares offering

OCBC NISP is looking to raise Rp 1.5 trillion or US$163.5 million  to strengthen its capitalization and extend loans by offering rights shares.


“Funds raised from the sixth rights issue will be used to strengthen capitalization structure, so that Bank OCBC NISP could be more flexible in expanding its business,” said OCBC NISP president director and CEO Parwati Surjaudaja.

The lender will offer up to 1.51 billion shares at Rp 1,000 apiece, an 18 percent discount on their market price of Rp 1,210 at Friday’s close.

Parwati previously said the offering could be launched in the coming months.

OCBC NISP’s capital-adequacy ratio is expected to reach 15 percent by the end of the year, from 13.8 percent in 2011, enough to extend more loans as part of the bank’s credit-expansion plans.

The bank’s loan-to-deposit ratio was at 87 percent at the end of last year, well within the central bank’s 78 to 100 percent range to indicate a healthy balance between credit and deposits at banks.

OCBC NISP wants to grow credit by between 25 and 30 percent this year to maintain last year’s 31 percent growth and will focus on lending for the agriculture, mining, oil and gas, consumption and transportation sectors

Lending expansions have made national commercial banks very profitable in recent years, with OCBC NISP booking a 80 percent increase in net profit to Rp 753 billion as net interest income — revenue derived from the lending rate charged to customers — rose 13 percent to Rp 2.26 trillion.

OCBC NISP did not explain why it decided to choose a rights offering instead of bond issuance like it had planned.

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