BII obtains $110 million loan from IFC

Jakarta (Antara News) - Bank Internasional Indonesia (BII) has secured a Rp1.1 trillion (US$110 million) loan from IFC (International Finance Corporation), the private sector arm of the World Bank, to encourage growth of small- and medium-scale enterpises (SMEs), a spokesperson said.

The IFC believed BII would be able to open more credit lines to SMEs, IFC Global Financial Market director Jyrky Koskelo said here Thursday.

Koskelo expressed hope the long-term loan in rupiah currency would help BII improve its asset risk and obligations profile.

Meanwhile, BII president director Henry Ho welcomed the partnership with IFC to enhance BII`s business expansion in the future and to increase BII`s corporate risk profile.

"We are sure SMEs are the backbone of the Indonesian economy. We are happy that through this cooperation our contribution to the SMEs sector will become larger," he said.

Last September BII, IFC and Sampoerna Foundation had planned to establish Indonesia`s first private financing facility for the provision of student loans.

The facility was expected to enable some 15,000 new students cover the cost of their tuition and university entrance fees, and meant the provision of 20,000 loans each amounting to an average of US$1,000 over a three-year period.

IFC and BII are sharing the senior risk participation at $2.5 million equivalent each (with a possible total participation for each of up to $10 million equivalent), while Sampoerna Foundation would provide expertise, knowledge and networks in the education sector in Indonesia.

The project was supported by the Swiss/IFC technical assistance trust fund which financed a student loan market study in Indonesia last year. (*)
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