Danamon Signs Loan Agreement With Wells Fargo
PT Bank Danamon Indonesia, Tbk. (Danamon) today signs a loan agreement valued at USD 50 million with Wells Fargo, one of the leading banking institutions in the U.S.
The loan, which is disbursed through Wells Fargo and guaranteed by Overseas Private Investment Corporation (OPIC), U.S. Government’s development finance institution, will be used to fund lending to Danamon’s micro, small, and medium enterprises (MSME) customers.
“We are very proud of this strategic alliance with Wells Fargo Bank N.A and OPIC, both of which are respected financial institutions in the US, for it underscores our commitment in supporting the growth of Indonesia’s MSME sector, as the country’s economic backbone.
As one of Indonesia’s leading financial institutions in the micro, small and medium enterprises sector with a network of more than 3,300 branches and outlets across the country, we are confident that this loan agreement would provide opportunities for many Indonesian micro and small businesses to grow further, which in turn stimulates the country’s economy and improve the welfare of its people. This is in line with our vision, which is to ‘care and enable millions to prosper,’” said Henry Ho, President Director, Danamon.
The signing procession, which was held at Danamon headquarters in Jakarta, was conducted by Bank Danamon President Director Mr. Henry Ho and Mr. Pradip Chhadva Director of Treasury, Capital Market, Financial Institutions & Transactional Banking, and Richard Yorke, Head of International Group, Wells Fargo. The procession was witnessed by His Excellency Scot Marciel, U.S. Ambassador to the Republic of Indonesia and Mr. Jim Ho, Head of Asia - Wells Fargo Bank N.A.
The USD 50 million loan has a three year term with an option to extend another two years and is disbursed through Wells Fargo, the U.S’s fourth largest and the world’s 24th largest bank in terms of assets with USD 1.161 trillion in assets and more than 160 years of experience.
Having previously signed a USD 20 million loan agreement with OPIC in 2011, this partnership is the second occasion in which Danamon receives a loan from OPIC, which is the U.S. Government’s development finance institution that mobilizes private capital to help solve critical world challenges by providing investors with financing, guarantees, political risk insurance, and support for private equity investment funds.
The role of OPIC in this loan agreement is to provide guarantee to Danamon and long-term loan through Wells Fargo Bank. The loan would then fund lending to Danamon’s small and medium enterprises customers as well as to micro enterprises customers through Danamon Simpan Pinjam (DSP), Danamon’s micro financing unit that focuses on traders in the traditional wet markets.
“With MSME loans constituting 31% of our total loan portfolio as of the end of 2012, we positively welcome this strategic alliance. Additionally, this loan agreement with OPIC and Wells Fargo supports our strategy on long term funds and liquidity management,” said Pradip Chhadva, Director for Treasury, Capital Market & Financial Institutions & Transactional Banking, Danamon.
About Danamon:
PT Bank Danamon Indonesia Tbk. (Danamon) was established in 1956 and as of December 31, 2012 operates over 3,300 branches and points of sales, including its Danamon Simpan Pinjam (DSP) and Syariah units as well as its subsidiaries branches. As of December 31, 2012 Danamon provides its customers with access to over 30,000 ATMs, including through its association with ATM Bersama and ALTO, in all 33 provinces in Indonesia. Danamon manages IDR 155.8 trillion in assets as of December 2012.
Danamon was recently awarded as the Best Private Bank with over IDR10 trillion in Assets in Risk Management Education at the Indonesia Enterprise Risk Management Award 2012 from Business Review. Danamon also received Digital Brand of the Year 2012 Award in the Credit Card Category from Infobank. Internationally, Danamon received “Best Corporate Governance” in FinanceAsia’s Asia’s Best Companies 2012 poll.
Danamon is the sole issuer and acquirer of American Express® cards in Indonesia under an independent operator agreement which allows it to issue American Express cards to individual and corporate clients. Danamon is also the only bank which provides services to local merchants who accept American Express Cards and for signing up new merchant partners in Indonesia. Danamon is also the sole license holder of Manchester United cards in Indonesia, allowing the Bank to issue Manchester United ATM/Debit cards and credit cards.
PT Adira Dinamika Multi Finance Tbk (Adira Finance), the automotive financing subsidiary of Danamon, operates an extensive branch network in more than 260 cities in Indonesia. Danamon is also the majority owner of PT Asuransi Adira Dinamika (Adira Insurance), a general insurance company and PT Adira Quantum Multifinance (Adira Kredit), a durable goods financing company
As of December 31, 2012, Danamon was 67.37% owned by Asia Financial (Indonesia) Pte. Ltd. and 32.63% by the public. On April 2, 2012, Danamon has been informed by Fullerton Financial Holdings Pte. Ltd., that it has entered into a share purchase agreement with DBS Group Holdings to sell its interest in the whole of the issued share capital of Asia Financial (Indonesia) Pte. Ltd. to DBS. The transaction is subject to the approvals, among others, of DBS shareholders and regulators in Singapore and Indonesia, including Bank Indonesia.
For further information regarding Danamon, please visit Danamon’s corporate website at: www.danamon.co.id