Advisory Services for Bank Sahabat Purba Danarta 2009-2011
In 2009, LFS was commissioned by the IFC to support a Microfinance Bank in Indonesia in its objective of becoming an efficient, large-scale MSME bank.
Bank Sahabat Purba Danarta is an MSME Bank headquartered in Semarang, Central Java. In 2007 the Bank was acquired by the Sahabat Group that injected capital into the bank, which was used for an expansion of the branch network, the purchase of new equipment, a 10-fold increase in the Bank’s overall loan portfolio, and a 3-fold increase in the small business credit loan portfolio. The Bank has 6 branches and about 300 staff. The objective of the assignment was:
- to develop and implement best-practice MSME loan products, policies, processes and procedures;
- to implement pilot operations in two branches in Central Java, and to roll them out other branches;
- to elaborate a strategy for Bank Sahabat Purba Danarta to become an efficient, large-scale MSME bank characterised by a strong credit culture shared by motivated, highly-dedicated employees;
- to design and implement an internal audit system for lending operations and all other operations of the Bank.
Lending operations started in November 2009. As of 28 February 2011, MSE loans under the new methodology were extended in 4 branches by 45 Loan Officers. The project ended in March 2011.
Feasibility Study for SME finance projects, 2005 and 2006
In 2005 and 2006, LFS, on behalf of KfW, carried out two feasiblitity studies on the Indonesian SME finance sector. The first study assessed the feasibility of an SME finance project. The second one assessed the feasibility of project of Technical and Financial Assistance to Support Small and Medium Industries in Indonesia. Both studies included the development of project proposals, based on the findings of the studies.