Government Prepares To Sell Bank Mutiara For Less Than Bailout
News: Indonesia's government is ready to sell Bank Mutiara for less than the 2008 bailout cost to meet its year-end deadline, according to Deposit Insurance Agency CEO Kartika Wirjoatmodjo (Reuters). By law, the lender has to be sold by end 2014. The state spent an approximate IDR6.7trn (US$593.31mn) to rescue the bank during the 2008 financial crisis. Around seven investors, mostly foreign lenders and private equity companies, from countries including Japan, China and Malaysia, have expressed interest to buy a majority stake in Mutiara, according to Wirjoatmodjo. Mutiara is excluded from the 40% limit on foreign ownership of local lenders. In 2013, Bank Indonesia ordered the deposit agency to inject IDR1.25trn (US$110mn) to lift the bank's capital adequacy ratio to 14% due to growing non-performing loans. Preliminary bids will commence in May 2014 and the deal is expected be closed before November 20 2014.