BCA Gets US$800 Million in Loan Commitment

PT Bank Central Asia (BCA) Tbk gets US$700 million-US$800 million in loan commitment from the International Finance Corporation (IFC) and Japan Bank for International Cooperation (JBIC).

IFC is committed to provide a US$400 million-US$500 million loan, while JBIC is committed to provide a US$300 million loan.

Vice President Director of BCA Jahja Setiaatmadja revealed the Central Bank (BI) had given its approval to the bank to use the funds to finance loan allocation.

"We will hold a board of directors meeting to decide what we will do with the funds. To be sure, BI has just given approval to BCA to use the funds provided by IFC and JBIC," he informed me lasst week.

He explained IFC gave three years to disburse the loans, while JBCI gave four years. "The credit terms are long. To be sure, BCA is given three and four years to disburse loans from IFC and JBIC, respectively."

Jahja said the projects to be financed by JBIC and IFC loans should match requirements made by the two financial institutions.

He inserted BCA would reap up margin from loans that the bank lent to its debtors. "For example, we provide loans for power plant projects. Certainly, BCA will get interest margin from the loans."

However, Jahja admitted he had yet been able to reveal the interest rates of the loans offered by the two financial institutions. According to him, the loans could be used to finance long-term infrastructure projects.

BCA also plans to reduce its fund placement in the central bank promissory notes (SBI to enlarge its lending rate this year to IDR85 trillion. Until June, BCA placed IDR23.14 trillion in SBI, up nearly twice from IDR12.13 trillion last year.