Danamon credit rating increased to AA +

as published in Bisnis Indonesia web page

Friday, 02/10/2009 13:25 WIB

Danamon credit rating increased to AA +

by: Irvin Avriano

JAKARTA (bisnis.com): Fitch's rating improve credit ratings of PT Bank Danamon Indonesia Tbk from AA (idn) to AA + action caused the rights issue of about Rp4 trillion in April 2009.

Prospect rankings were determined stable. Director of Fitch's Financial Institutions Group Tan Lai Peng emphasized public offering limited action that contributed to the increase in the consolidated capital adequacy ratio (CAR).

CAR tier 1 at the end of the quarter increased to II/2009 registration of 21.1% from 13.8% at the end of 2008.

"The increase in the national ratings of Bank Danamon reflects the relative soundness of the company's financial profile is supported by a strong base and profitability have helped absorb the impact of the credit costs higher," said Tan Lai Peng in a press release received this morning business.

He explained that raise core capitalization companies which also have to prop the bank against unexpected risks. Potentials can arise from an increase in macroeconomic climate, the increase in the climate is still limited.

Fitch also affirmed ratings of foreign-denominated long-term (issuer default rating / IDR) of Bank Danamon in the BB level, short-term credit ratings of foreign denominated in B, and individual rankings in the level C / D. Level support level ranking in the bottom 3 and the support rating at BB-level.

Temasek Holdings, which is the Singapore government's investment wing, is still set its majority ownership in the bank through the Asia Financial (Indonesia).

According to Fitch, the majority ownership of Temasek and management control of Bank Danamon showed a moderate tendency to support the bank's financial strength. As the sixth largest bank in Indonesia, state support is also possible if the company is experiencing fiscal constraints.

The company also increased following the repayment of capital sub-ordination worth U.S. $ 300 million in March 2009, banks considered able to strengthen the capital position to help finance organic growth in the next three years. (tw)