Hanwha Life, a life insurer under the South Korean conglomerate Hanwha Group, plans to acquire a 40% stake in the Lippo Group-backed Indonesian lender Bank Nobu, according to an announcement.
Financial details of the transaction were not disclosed.
The deal is expected to be finalised after the signing of the contract between the two companies and approval from regulatory authorities in both countries.
Lippo Group through five affiliates—PT Putera Mulia Indonesia, PT Prima Cakrawala Sentosa, PT Star Pacific Tbk, PT Matahari Department Store Tbk, and PT Inti Anugerah Pratama—currently holds an over 75% stake in IDX-listed Bank Nobu, while the rest is owned by the public and brokerage companies.
The planned acquisition is part of Hanwha Life’s move to diversify beyond its core business of life & general insurance into banking operations in Indonesia. It also plans to use Indonesia, with its fast-growing economy and favourable demographics, as a base for expanding into the wider Southeast Asian market.
Founded in 1990, Bank Nobu is a mid-sized local bank, ranking within the top 30 in Indonesia by total assets, which stood at 26 trillion rupiah ($1.6 billion) at the end of 2023. Bank Nobu operates in 119 locations and employs more than 1,200 staff.
The Lippo Group operates in various sectors including finance, real estate, and retail, and has strong brand recognition locally.
By integrating Lippo Group’s banking management expertise, Hanwha Life aims to establish itself in the market swiftly, by creating hybrid channels that enhance traditional in-person channels and digital banking and expanding a mobile-based business environment.
Additional synergies are expected from the sale of life insurance products through Hanwha Life Indonesia and general insurance products through Lippo General Insurance, utilising the two companies’ bancassurance relationship. The partnership is also expected to increase the local brand awareness and influence of Lippo Group, as well as its ecosystem of affiliates, employees, supply chains, and customers.
“Hanwha Life already maintains a leading position in the domestic market through proactive management, but to overcome the limitations of the domestic market and ensure continuous growth, accelerating our global strategy is essential,” stated Seung-Joo Yeo, Vice Chairman and CEO of Hanwha Life.
In the first quarter of 2024, Bank Nobu recorded net profits of 141.5 billion rupiah, compared to 103.8 billion rupiah in the same period last year. Revenues surged 34% to 1.65 trillion rupiah in Q1 2024, compared with 1.23 trillion in Q1 2023.
