The New York Times's Deal Book blog posted an article yesterday detailing the difficulties Singapore's DBS Bank -- southeast Asia's largest bank -- has been having getting approval to acquire control of Indonesia's Bank Danamon. What seemed a simple process of reshuffling holdings of Temasek, one of Singapore government investment vehicles and DBS (itself for nearly 30% state-owned) so as to concentrate the focus on Danamon logically with DBS has suddenly become politically mired. Indonesia wants equal access to the island state's markets for its state banking flagships Mandiri, BNI and BRI. Not so simple.
This will be an interesting case of just how rapidly ASEAN integration will be allowed to proceed. The region's Balkanised banking systems and long history of regulatory protection and local favouritism will be increasingly tested as ASEAN's open markets initiatives unfold. This story will run and run.
-- Jan Cherim
To see the full article:
http://dealbook.nytimes.com/2013/05/22/indonesia-links-ownership-of-banks-to-more-access-elsewhere/?smid=pl-share
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