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IFC Provides Local Currency Financing To Indonesia's ANJ Finance

In Jakarta
Nia Sarinastiti

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Jakarta, May 10, 2005 —The International Finance Corporation, the private sector arm of the World Bank Group, today signed an agreement to provide up to $15 million (145 billion rupiah equivalent) through a local currency loan facility to PT. Austindo Nusantara Jaya Finance, or ANJ Finance.  The loan facility is the first fixed-rate-long-term loan in Indonesian rupiah offered by IFC, and novel for the market since the Asian financial crisis. The financing package is aimed at significantly improving risk profile of ANJ Finance, especially related to interest rates. The transaction also meets the company’s need for local currency financing while offering benefits related to IFC’s global experience and knowledge of international best practices.

ANJ Finance is a nonbank financial institution that plans to use the funds to expand its automobile financing and leasing activities. The loan facility will also help ANJ Finance manage risks associated with loans from other institutions. Nonbank financial institutions are becoming increasingly important for meeting the needs of consumers of smaller business in Indonesia.
“This loan facility supports the development of the nonbank financial sector in Indonesia. Indonesia’s financial system is still dominated by banks, with nonbank financial institutions achieving a mere 20 percent of the country’s financial assets,” said IFC Country Manager German Vegarra. “Local currency, fixed rate financing to ANJ Finance will help the Indonesian consumer finance sector grow prudently.”

IFC Vice President, Finance Nina Shapiro, said, “IFC’s capacity to provide long-term Indonesia Rupiah financing through market based mechanisms will help the client avoid foreign exchange risk. By matching the currency denomination of assets and liabilities, ANJ Finance can concentrate on its core businesses and extend new long term consumer loan products in the local market without worrying about exchange rate volatility”. She added, “The IFC local currency financing demonstrates the Corporation’s commitment to support viable projects that improve access to local consumer finance.”

“This loan will help us in developing our automobile financing and leasing activities,” said ANJ Finance’s Director Herman Lesmana.  “The consumer finance market in Indonesia has enjoyed an annual growth rate of about 50 percent since 1999, mostly due to demand for automobiles and motorcycles. ANJ Finance can take advantage of this rapid expansion by offering better and more comprehensive services.”

ANJ Finance is an Indonesian private multi finance company that primarily provides financing for consumer purchases of new and used automobiles.  The company was previously known as PT. Elbatama Finance and in 2003; the name was changed to PT. Austindo Nusantara Jaya Finance to reflect association with its holding company, PT. Austindo Nusantara Jaya. ANJ Finance is headquartered in Jakarta and also operates out of twelve branches located in major cities in Java and Sumatra islands.

The mission of the International Finance Corporation
( is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY04, IFC has committed more than $44 billion of its own funds and arranged $23 billion in syndications for 3,143 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY04 was $17.9 billion for its own account and $5.5 billion held for participants in loan syndications.