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Mandiri will sell its remaining MAGI shares

29 October 2019 07:55

JAKARTA. PT Bank Mandiri Tbk (BMRI) will release its remaining MAGI (Mandiri AXA General Insurance) shares, because the return on investment (RoI) is not in accordance with company policy.

Bank Mandiri initially had a 60% stake in AXA, and had already sold 40% of it, so now it has a 20% stake. AXA is a joint venture (JV) with AXA S.A. which engaged in the general insurance business.

Hery Gunardi, Director of Small Business and Network of BMRI, said the company is considering to sell its MAGI shares since the return on investment (ROI) was slow, while the amount of capital needed to run the business is high.

"The RoI is not too large. For Mandiri, merger acquisition must result in good ROI. So it's better to pull out. We have already sold 40%, in the next three years AXA must find another partner, because the rules said that foreign investors can only have an 80% stake, the remaining 20% should be owned by local," said Hery at Plaza Mandiri, Jakarta on Monday (28/10/2019).

Even though Mandiri will no longer own shares in the company, Hery said that bankassurance cooperation will continue. So the company will only benefit in the form of fee-based income from this business. (AM/AR) 

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