Bank Negara Indonesia to grow Shariah banking

SINGAPORE: Indonesia's fourth largest lender Bank Negara Indonesia (BNI) is actively searching for a partner to further tap growth opportunities in Shariah banking. Its CEO Gatot Suwondo said the bank is also looking to venture into micro-banking - an area that's new to BNI right now.

Bank Negara Indonesia is one of the familiar household names in Indonesia with over 1,500 branches.

And the lender is looking to grow its business further.

For 2011, BNI booked a net profit of about 5 trillion rupiah (US$550 million) - up by some 40 percent from the previous year.

In 2010, BNI injected around US$100 million in Shariah banking. Now it is evaluating potential business partners to spur growth in Shariah banking space.

Mr Gatot said: "We need a partner who has knowledge in Shariah and besides that, we have network in Shariah and of course, strong funds to grow our shariah banking.

"Some of our potential partners for Middle East are approaching us. Looking at partners, you can't do it in one night. You need to know first if their vision is in line or not."

BNI also has its eye on some potential acquisition targets to help the bank make inroads into the micro-finance market.

Micro-finance refers to the provision of banking services to poorer clients, who typically do not have access to many financial services.

Mr Gatot added: "We prefer maybe to acquiring bank to cater to market segment that we're not in a capacity to do, for example micro-banking. (...)