Standard Chartered completes sale of equity interest in Permata

Maria Nikolova

Standard Chartered Bank sold its shareholding in Permata for cash consideration of IDR17 trillion (US$1.07 billion).

Standard Chartered PLC (LON:STAN) today announces the completion of the sale of its 44.56% equity interest in PT Bank Permata Tbk to Bangkok Bank Public Company Limited.

Standard Chartered Bank (SCB) sold its shareholding in Permata on May 20, 2020 for cash consideration of IDR17 trillion (US$1.07 billion), representing a premium of US$0.3 billion over the Group’s carrying value.

The finalization of the deal represents significant further progress on Standard Chartered’s strategic priorities. The sale of Permata will allow the Group to focus exclusively on optimising the performance of its wholly-owned branch in Indonesia, which remains a large and strategically important market for the Group.

In February 2019, the Group announced that its strategic priorities in Indonesia were to resolve the non-core status of Permata, to continue to drive higher quality income from multi-national businesses and to test disruptive retail digital platforms. Higher Corporate & Institutional Banking income in the first quarter of 2020 led to profits in Indonesia trebling year-on-year and in March the branch launched its “Banking as a Service” solution, nexus, to offer financial services through e-commerce platforms.

Completion of the transaction will result in an increase in Standard Chartered’s Common Equity Tier 1 capital ratio of around 40 basis points, based on its financial results for the period ended 31 March 2020. This is attributable to a reduction in risk-weighted assets of around US$9.1 billion and the deconsolidation of US$0.5 billion minority interest equity (net of regulatory adjustments including goodwill).

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