Mandiri Opens Singapore Branch, Seeks ‘Presence’Jasmine Ng
PT Bank Mandiri, Indonesia’s largest lender by assets, has opened a new office in Singapore to integrate its brokerage and investment-management units, seeking a foothold as rivals from the city state expand in its home country.
The branch allows Mandiri to tap Singapore’s financial markets to develop products that aren’t available in Indonesia, President Director Budi Gunadi Sadikin said in an interview in Singapore today. Mandiri aims for a “reasonable presence” and wants the city state to treat it fairly as Singapore lenders such as Oversea-Chinese Banking Corp. and United Overseas Bank Ltd. have established a network of branches in Indonesia.
“We don’t have the products in Indonesia because the market isn’t as sophisticated as Singapore,” Sadikin said. “Some of our Indonesian clients, when they want to expand overseas, they can get those services from our banks.”
Bank Indonesia in 2012 imposed foreign ownership limits that prompted Singapore’s DBS Group Holdings Ltd. to drop its 66.4 trillion rupiah ($5.8 billion) takeover of PT Bank Danamon Indonesia, as it sought reciprocity from Singapore for expansion by Indonesian banks including Jakarta-based Mandiri.
“Give us a decent number of branches,” Sadikin said at a press briefing during an opening ceremony. “If there’s a positive gesture, an opening or opportunity given to Indonesian banks, it’s actually a benefit for Singaporean banks to get much broader opportunities in Indonesia.”
PT Bank OCBC NISP owns 360 branches in Indonesia, compared with about 50 OCBC branches in Singapore, according to data on the companies’ websites. PT Bank UOB Indonesia has a total of 213 branches across the archipelago, according to its 2012 financial report. That compares with about 50 UOB branches in Singapore, its website shows.
Mandiri’s Singapore branch includes services offered by its brokerage and investment fund units, Sadikin said. The bank plans to serve its Indonesian customers who own funds in Singapore, he said.
“The Indonesian market is 10 times, 20 times bigger than the Singapore market,” Sadikin said.