Affin buys Indonesia's Bank Ina for RM138m

In its first foray overseas, Affin Bank will have a direct majority shareholding of 80 per cent in Bank Ina and the Indonesian lender will be converted into an Islamic bank

Affin Bank Bhd (5185), the country's second smallest bank, has bought Indonesia's PT Bank Ina Perdana for RM138 million, making it its first overseas venture.

"We are encouraged with the growth potential in Indonesia, especially with Bank Ina's niche positioning as a retail bank in the small- and medium-scale enterprise sector.

"This acquisition fits in nicely with Affin Bank's long-term plan to further grow its business and increase shareholders' value," Affin Bank managing director and chief executive officer Datuk Zulkiflee Abbas Abdul Hamid said in a statement released yesterday in Kuala Lumpur.

Affin will be the latest bank venturing into Indonesia, after CIMB Group, Malayan Banking Bhd (Maybank) and RHB Capital Bhd, which bought into PT Bank Niaga, PT Bank Internasional Indonesia and PT Bank Mestika Dharma respectively.
With the acquisition and subsequent subscription of shares, Affin Bank will have a direct majority shareholding of 80 per cent in Bank Ina.

The purchase price will translate into an average price-to-book ratio of 1.69 times based on the unaudited net assets of Bank Ina as at May 31 this year.

"We see this acquisition as a step forward for Affin Bank and Affin Islamic. The potential for Islamic banking in Indonesia is vast and Affin Islamic has the capabilities and expertise to ensure growth and development of syariah banking as we move regionally," Zulkiflee said.

In a Business Times interview on April 26, Zulkiflee had said that Affin Bank would convert Bank Ina into an Islamic bank when its purchase was completed.

Affin Bank is a wholly-owned subsidiary of Affin Holdings Bhd, with 82 branches in Malaysia.