Danamon Shareholders Approve Rights Offer

PT Bank Danamon Indonesia, backed by Temasek Holdings Pte and Deutsche Bank AG, said shareholders today approved its proposal to sell 4 trillion rupiah ($345 million) of shares in a rights offer next month to raise capital. Proceeds from the sale will be used to expand lending, Danamon President Director Sebastian Paredes told reporters in
Jakarta today.
The rights offer will bolster Danamon capital adequacy ratio to 20.8 percent from 15.4 percent, it said. The minimum required level is 8 percent.
Danamon joins Asian banks such as DBS Group Holdings Ltd., which raised S$4 billion ($2.6 billion) from a rights offer in January, in shoring up capital as economies across the region
falter.
The Indonesian central bank expects Southeast Asia biggest economy to expand at its slowest pace since 2001, as the global recession trims demand for the nation's products.
The strength of Bank Danamon balance sheet after this capital increase will place the bank in a unique position to face the current global uncertainties and challenges ahead, Paredes said in an e-mailed statement.
Danamon plans to sell as many as 3.33 billion shares at1,200 rupiah each, the Jakarta-based company said.