Indonesian conglomerate Astra International announced on Monday that it acquired a 49.56% stake in the local lender Bank Jasa Jakarta for 3.87 trillion rupiah ($258.56 million).
The transaction is understood to be part of Astra’s strategy to double down on Indonesia’s lucrative digital banking sector.
According to a disclosure to the Indonesia Stock Exchange (IDX), Astra’s financial sector arm Sedaya Multi Investama (Astra Financial) will absorb 1.13 million new shares of Bank Jasa. “The purpose of the transaction is to support Astra Financial’s business development and investment,” Gita Tiffani Boer, corporate secretary of Astra International said in the statement.
Suparno Djasmin, director in charge of Astra Financial told DealStreetAsia that Bank Jasa will be a digital bank under Astra International.
Meanwhile, Hong Kong-based unicorn WeLab is also increasing its stake in Bank Jasa to 49.56%, according to the IDX filing.
In December 2021, WeLab, backed by billionaire Li Ka-shing, had announced an investment into Bank Jasa as part of its plan to launch a second digital bank in Indonesia after Maucash — a joint venture with Astra to provide mobile lending services.
Suria Dharma, an analyst at Samuel Sekuritas, said: “If there are two major shareholders [Astra and WeLab] with the same ownership, it will be difficult to take a strategic decision.” However, he sees Astra’s vision of building a digital bank with support from WeLab, positively.
Founded in 1984 by Iskandar Widyadi, an Indonesian textile entrepreneur, Bank Jasa was originally a rural bank under the name Bank Pasar Warga Grogol, based in Jakarta.
As of March 2022, Widyadi and his family held Bank Jasa stakes worth 61.23% and 14.77%, respectively.
According to the Indonesian financial services authority (OJK), a bank should meet minimum capital requirements of at least 3 trillion rupiah by the end of this year. But, Bank Jasa’s capital in March 2022 stood at only 2.1 trillion rupiah.
“With the Astra deal, Bank Jasa can increase its capital,” Maximilianus Nico Demus, research and investment associate director at Pilarmas Investindo Sekuritas, told DealStreetAsia.
Its annual profit roughly halved from 31.85 billion rupiah in the year ended March 2021 to 15.35 billion rupiah in the year ended March 2022, mostly due to a decrease in interest income.
Loan takeoff also slowed to 2.4 trillion rupiah as on end-March, compared with 2.58 trillion rupiah at the end of last year. Total deposit also reduced to 5.15 trillion rupiah, from 5.32 trillion rupiah in the same period.
Previously, Astra International and Standard Chartered Bank held a 44.56% stake each in Bank Permata, which was sold to Bangkok Bank in April 2020.
There has been a flurry of deals in the digital banking space in Indonesia. While superapp Grab has acquired a stake in Bank Fama, its rival Gojek has invested in Bank Jago. Ant Group-backed Akulaku, meanwhile, has backed Bank Neo Commerce, and Sea Ltd. last year acquired Bank BKE. Indonesia’s wealth tech unicorn Ajaib, too, acquired a 24% stake in Bank Bumi Artha in November 2021.
In February this year, the online lending platform Funding Societies, also known as Modalku, made a minority stake investment in Indonesia’s PT Bank Index Selindo, DealStreetAsia reported.
DealStreetAsia reported in April 2021 that Singapore-based Sea Ltd, along with Indonesian retail chain Alfamart, is in talks to buy a small stake in Bank Aladin Syariah Tbk.