According to Sugiharto Widjaja, retail equity director at CGS-CIMB, the online stock trading platform is called iTrade and it will give retail investors easier access to the equity market.

Sugiharto Widjaja further revealed that the CGS-CIMB online stock trading platform aims to book 10,000 new retail accounts this year.

The online stock trading platform launched by CGS-CIMB is also designed to attract students in the country.
CGS-CIMB president Lim Kim Siah told the media, “Through iTrade, we are offering a one-stop-shop for investment services. For young buyers, there may be some investment that we won’t introduce to them, as we tailor our wealth management to a client’s profile.”

According to local media reports, the trading platform has features such as historical charts that display information on stock movements for the past seven years. The platform will also help customers see the overall market conditions.

Another feature called stockscreener groups shares based on technical and fundamental indicators and investors can make decisions based on these indicators.

CGS-CIMB’s decision to launch the online stock trading platform is based on the fact that the Indonesian stock market sees very low participation from individual investors and therefore has a lot of potential.

According to reports, the number of single investor identifications (SID) registered at the Indonesian Central Securities Depository (KSEI) stood at 2.4 million by the end of 2019. Around 44.62 percent of these investors were in the age group between 21 and 30.

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In 2016, Permata was the tenth biggest bank in Indonesia by assets. Currently, it has a market value of $2.4 billion. In addition to DBS, Oversea-Chinese Banking Corporation (OCBC Bank) and Sumitomo Mitsui Financial Group are also interested in acquiring Permata. 

In March, Indonesia’s Bank Mandiri was working with Morgan Stanley to takeover Permata in a $2 billion deal. Ministry of State owned Enterprises had approved Mandiri to acquire Permata shares to increase return on equity (RoE). 

Standard Chartered and Astra International each own a 45 percent stake in Permata. 

DBS chief executive officer Piyush Gupta, told the media that, “In addition to a fundamentally digital presence, we are beginning to figure you need some points of presence for the time being to create brand credibility and to service the last mile.” 

This would be DBS’ second attempt to acquire a bank in Indonesia. In 2013, DBS pulled the plug on a 6.5 billion acquisition deal with Bank Danamon owing to regulatory issues. Change in foreign ownership rules forced the bank to pull out from the deal. 

After that, DBS has been keen to expand its presence through digital services—and is open to acquisitions that match its strategy. In the first half of the year, Permata reported net income of  711.4 billion rupiah, compared to 288.8 billion rupiah from the previous year. 

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The bank cut the seven-day reverse repo rate, its benchmark rate by 25 basis points to 5.75 percentage on Thursday. Bank Indonesia also slashed the lending and deposit rates to 6.5 percent and 5 percent, a reduction of 25 basis points.

Meanwhile, economic data revealed on Tuesday pointed that the Indonesian economy was slowing. Media reports attributed this slowdown as partly due to the ongoing US-China trade war.

Bank Indonesia while making the rate cut noted that the country needed to boost domestic growth while external pressure had eased. The decision was spurred by low inflation and the need to boost growth.

Speaking on the rate cut Bank Indonesia governor Perry Warjiyo said that the bank sees further potential for monetary policy easing taking into consideration low inflation and need to boost growth.

The Indonesian central bank had embarked on a monetary policy tightening cycle from May to November 2018. Bank Indonesia took the tightening stance to stabilise the country’s current account balance.

Warjiyo said that the monetary policy will be accommodative going forward. This means that the Bank Indonesia could further ease liquidity or cut the interest rate.

Although Indonesia had recorded two months of trade surplus to June, the country’s exports declined. Import of auxiliary raw materials also slowed reflecting slower production and therefore lower investment.

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