Indonesian Finances
Shinhan Bank (President Cho Byoung-yong) has received approval on April 16 from the financial services authority of Indonesia, or OJK, to buy stakes of Indonesia’s bank based in Jakarta.
This is the first case for the Indonesian government to give its approval to a foreign bank for a stake purchase after the introduction of regulations over the limit of the major shareholder’s stakes of a financial institution in 2012.
Accordingly, Shinhan Bank will take over Indonesia's Bank Metro Express (BME), which is a foreign exchange commercial bank established in 1967 and based in Jakarta.
Even though it is a small bank with a 19 channel network, it has only 0.38 percent of non-performing loans, but also numerous loyal small and medium sized corporate customers. Therefore, it is the best choice for Shinhan Bank to acquire experience and implement a phased growth strategy in the local financial market, said the bank.
Shinhan Bank will not only buy 40 percent of the BME from the approval, but also push ahead with another approval to purchase more stakes in the near future so that it can secure control over the bank. Also, it will carry out a localization strategy with a systematic support system.
As Shinhan Bank has made inroads into all the major Southeast Asian financial markets, including Vietnam, Cambodia, Indonesia, the Philippines, Myanmar, and India, it is said that the bank has strengthened its global business strategy to establish an “Asia Financial Belt.”