Indonesia's state Islamic bank merger to form $15 billion mega entity

Indonesia is pushing ahead with a years-long plan to merge the Islamic units of its state-owned lenders, which could form an entity with $15 billion of assets.

PT Bank Mandiri, PT Bank Negara Indonesia and PT Bank Rakyat Indonesia signed a conditional deal on Monday to combine their Shariah-compliant units. The merged entity’s assets could reach 390 trillion rupiah ($26 billion) by 2025, from up to 225 trillion rupiah by end of 2020, as its scale helps it better compete with non-Islamic lenders.

The resulting bank “will raise Indonesia’s profile on the global stage and revive the domestic Shariah economy,” said Hery