Eximbank eyes 25% lending growth

JAKARTA. State-owned export financing agency Indonesia Eximbank expects its total loans to grow by at least 25 percent this year thanks to an increase in the number of export-supporting infrastructure projects financed by the company.

“Lending growth might grow between 25 percent and 30 percent this year, but will slightly decline in 2014 due to the general elections,” Eximbank senior executive director Arifin Indra said during a visit to The Jakarta Post on Tuesday.

The bank’s total loans (financing), which reached about Rp 27.05 trillion (US$2.65 billion) at the end of 2012, grew sharply to as high as Rp 30.62 trillion at the end of June. Eximbank allocates most of its financing to the corporate segment.

As of December 2012, the corporate segment accounted for 91.28 percent of its financing, while the rest consisted of small and medium enterprises (SME). As of June 2013, corporate segment financing grew to 91.71 percent.

Eximbank is a special financial institution that was established based on Law no. 2/2009 on Indonesia’s export financing institution. Its main purpose is to provide export assistance to businesses in the form of financing, guarantees and financing.

It also provides financing for projects that are considered too risky to be financed by ordinary banks but have good prospects to improve the overall performance of national exports.

“This year we have been facing numerous problems with exporting goods. So, we have begun to provide more credits for the development of infrastructure projects that are specifically designed to support export-oriented sectors,” Eximbank Chairman and chief executive officer (CEO) I Made Gde Erata said.

The projects are privately initiated but some of them are synergized with several state-owned companies such as Pelindo III, which acted as the official port operator in several international trade port hubs in the country.

The projects include the expansion of Juanda airport in Surabaya, East Java, the development of a gas-powered power plant in Borang, Palembang, the development of Tanjung Priok Port in Jakarta and the Dumai-Lubuk Gaung street development project.

Projects that involve only private parties include port development projects in Marunda and Gresik, industrial area development in Bekasi, West Java and numerous smelter projects.

Made said one of the smelter projects that was partly financed by the bank was the development of a steel processing plant in Cilegon, Banten by PT Indoferro, part of Growth Asia.

“We might be one of the few banks that have managed to finance a steel processing plant up to its completion,” Made said.

Another smelter project currently being financed by Eximbank is located in Morowali, Southeast Sulawesi. The nickel processing plant was being built by PT Sulawesi Mining Investment, a joint venture between Bintang Delapan Group and Tsingshan Group of China, Eximbank chief executive director Dwi Wahyudi said. (Hans David Tampubolon)