INDONESIAN INSURER JAMSOSTEK TO BUY 30% OF BANK BUKOPIN

Indonesia's state-owned workers' insurance company PT Jamsostek is closer to owning up to 30 per cent of PT Bank Bukopin Tbk (JSX:BBKP) when the medium sized lender launches rights issue by the end of this year.

Jamsostek has agreed to become the standby buyer of the rights shares and acquire up to 30 per cent of the bank shares, Bukopin President Glen Glenardi said yesterday.

Glen said the rights issue is needed to raise fund to increase the bank's capital in line with the central bank's policy encouraging banks to strengthen equity capital.

He said the bank needs stronger capital to support its business expansion program, adding currently it has a capital adequacy ratio of 14 per cent and plans credit expansion of 15 per cent-20 per cent this year.

The bank had Rp24 trillion (US$2.6 billion) in outstanding credits by March and by the end of June the amount was estimated to rise to Rp25 trillion, the newspaper Bisnis Indonesia said.