Indonesia delays deadline for single bank ownership

* No new deadline for single bank ownership rule
* Govt to study impact on four state-owned banks
* Policy forced Temasek to sell BII stake, Bank Niaga merger
* Analysts say govt could lower stake in top lender Mandiri
By Telly Nathalia and Neil Chatterjee

Asian Defense News: JAKARTA, Jan 26 - Indonesia will delay an end-2010 deadline requiring investors to own only a single bank in Southeast Asia's largest economy, giving the government more time to work out what to do with its major stakes in four banks.
Analysts said it was unclear exactly what would happen to the government's stakes, but any asset sales could attract strong interest to get exposure to a fast-growing economy that investors hope could reach investment-grade status in a few years.
The policy from the central bank requires all banks that share a major shareholder to merge, divest or create a single holding company.
The government owns controlling stakes in four major banks, including 66 percent of Indonesia's top lender Bank Mandiri , 56 percent of Bank Rakyat Indonesia >, 76 percent of PT Bank Negara Indonesia and 73 percent of the recently listed PT Bank Tabungan Negara .
"There has been no indication of the Indonesia government selling its stake in the banks. Mandiri has indicated that government ownership will be reduced to below 60 percent, to qualify for a lower tax rate. We do not know whether it will be through divestment or a new share issue," said Salman Ali, head of Indonesia research at Citi Securities in Jakarta.
The policy, originally set for 2008 but pushed back several times already, forced Singapore state fund Temasek [TEM.UL] to sell a stake in one of its two banks in Indonesia, and could bring about management changes at state-owned banks, government officials have said.
Said Didu, secretary of the state enterprises ministry, did not give a new deadline for the policy, which aims to consolidate the banking sector and help improve transparency.
MERGERS UNLIKELY
The policy led to the 2008 merger of Bank Niaga and PT Bank Lippo Tbk to form CIMB Niaga .
Purbaya Yudhi Sadewa, an analyst with Indonesian broker Danareksa, said it would be difficult for any potential further mergers to win shareholder approval.
Didu said the government had to tread carefully over the state-owned banks, because decisions could affect the banking system and the economy.
"We need to draft and do deep research about it, about its impact for state-owned banks," Didu told Reuters on Tuesday.
Singapore's state investor Temasek, which still owns 68 percent of Indonesia's PT Bank Danamon , sold its majority stake in Bank International Indonesia to Malaysia's Maybank in 2008 because of the policy.
Temasek profited from the deal, but investors have since been pouring into Indonesian markets in the past year to get exposure to Southeast Asia's strongest growth, a surge in the stock market <.JKSE> and a buoyant rupiah currency.
Fitch Ratings gave the country a vote of confidence on Monday, upgrading its sovereign rating [ID:nSGE60O0EV]. And private equity group CVC Partners joined retail firm Matahari Putra Prima in a joint venture buying Matahari's department store chain arm for $773 million on Monday.[ID:nSGE60O0J0]
Indonesia's stock market jumped over 80 percent and bonds posted equity-like returns last year as investors bought into the prospect that relatively stable politics and healthy economic growth could push the country to investment-grade status in a few years, alongside BRIC nations Brazil, Russia, India and China.