Exploring new opportunities

Mandiri banking on wider service, stronger ties

In the third and final part of this series, we look at plans of some Asean businesses located in countries other than Singapore, Malaysia, Thailand and Vietnam.

JAKARTA • Bank Mandiri's dream of running a wider service in Malaysia inched closer to realisation after it bagged a Qualified Asean Bank licence.

With the licence, the state lender will be able to establish a fully licensed branch - that will be treated the same as local Malaysian banks - and expand services to wholesale and retail banking, from only offering remittance services at present.

Mandiri has set aside RM300 million (S$95.7 million) as capital for the branch, to be named Bank Mandiri Berhad. It has injected RM30 million so far.

"We will add to the capital gradually," Bank Mandiri president director Kartika "Tiko" Wirjoatmodjo said after meeting Bank Negara Malaysia governor Muhammad Ibrahim last month.

Mandiri has been trying to penetrate more deeply into the Malaysian banking market for several years.

Mr Tiko said it was looking to bank on the growing economic and business ties between Indonesia and Malaysia, a sentiment shared by Mr Ibrahim.

In his remarks, Mr Ibrahim said Indonesian firms have started to increase their presence in Malaysia and that a significant step forward came last month when both countries' trade ministers announced a target for bilateral trade of US$30 billion in the coming years, double last year's US$13.8 billion.

Mandiri is looking to launch the branch's operations by the end of this year.

Currently, the publicly listed lender has branches in the Cayman Islands, Timor Leste, Hong Kong, China and Singapore.

Mandiri is also exploring the possibility of widening its network in several other Asean countries such as the Philippines.

THE JAKARTA POST/ASIA NEWS NETWORK

A version of this article appeared in the print edition of The Straits Times on August 12, 2017, with the headline 'Mandiri banking on wider service, stronger ties'. Print Edition | Subscribe