Indonesia Merges Three Sharia Banks and Create a Massive New Entity

Indonesia Merges Three Sharia Banks and Create a Massive New Entity

The merger of three state-owned Islamic banks in Indonesia has started with the signing of the Conditional Merger Agreement earlier this week.

As of Feb. 1, BNI Syariah and Bank Syariah Mandiri will officially merge with BRI Syariah (BRIS) to form Bank Syariah Indonesia, the country’s largest Islamic bank.

The merger was approved at an extraordinary general meeting of BRIS – the surviving entity in the merger – shareholders, Hery Gunardi, chief executive officer (CEO) of Bank Syariah Indonesia, said in an online news conference on Wednesday.

Gunardi, who is vice president director of Indonesian financial giant Bank Mandiri, was appointed CEO of Bank Syariah Indonesia by the Ministry of State-Owned Enterprises.

The ministry has also approved the structure of the new bank’s board of directors.

It will include a CEO, two deputy CEOs, and directors of wholesale and transaction banking, retail banking, sales and distribution, information technology and operations, risk management, compliance and human capital, and finance and strategy.

“We have been working on this merger plan since March and we will continue our preparations so that all processes can, hopefully, be completed on schedule,” said Gunardi.

“We have finalized articles of association, the name, logo, and the organizational structure. All of these have been approved by shareholders.”

The next step of the process, he added, is the legal merger of bank branches, products, IT technology for digital banking, and human resources.

He said it is estimated that the total assets of the merged entity will reach 214.6 trillion Indonesian rupiah ($15.2 billion), with total equity of 20.4 trillion Indonesian rupiah ($1.4 billion).

It will rank among Indonesia’s top 10 banks in terms of assets and the top 10 Islamic banks in the world in terms of market capitalization.

Kartiko Wiroatmodjo, deputy minister for state-owned enterprises, said Bank Syariah Indonesia is expected to be a catalyst for growth in the country’s Islamic finance economy.

“It will be an adviser for global sukuk [financial products compliant with Islamic law] issuance for prospective Indonesian companies,” he said.

According to the minister, the merger has been undertaken so that Indonesia, the country with the world’s largest Muslim population, can optimize its economic and Islamic finance potential.

Akhyari Hananto

I began my career in the banking industry in 1997, and stayed approx 6 years in it. This industry boost his knowledge about the economic condition in Indonesia, both macro and micro, and how to More understand it. My banking career continued in Yogyakarta when I joined in a program funded by the Asian Development Bank (ADB),as the coordinator for a program aimed to help improve the quality of learning and teaching process in private universities in Yogyakarta. When the earthquake stroke Yogyakarta, I chose to join an international NGO working in the area of ?disaster response and management, which allows me to help rebuild the city, as well as other disaster-stricken area in Indonesia. I went on to become the coordinator for emergency response in the Asia Pacific region. Then I was assigned for 1 year in Cambodia, as a country coordinator mostly to deliver developmental programs (water and sanitation, education, livelihood). In 2009, he continued his career as a protocol and HR officer at the U.S. Consulate General in Surabaya, and two years later I joined the Political and Economic Section until now, where i have to deal with extensive range of people and government officials, as well as private and government institution troughout eastern Indonesia. I am the founder and Editor-in-Chief in Good News From Indonesia (GNFI), a growing and influential social media movement, and was selected as one of The Most Influential Netizen 2011 by The Marketeers magazine. I also wrote a book on "Fundamentals of Disaster Management in 2007"?, "Good News From Indonesia : Beragam Prestasi Anak Bangsa di dunia"? which was luanched in August 2013, and "Indonesia Bersyukur"? which is launched in Sept 2013. In 2014, 3 books were released in which i was one of the writer; "Indonesia Pelangi Dunia"?, "Indonesia The Untold Stories"? and "Growing! Meretas Jalan Kejayaan" I give lectures to students in lectures nationwide, sharing on full range of issues, from economy, to diplomacy Less
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