Does a bank actually need to obtain approval from customers for the acquisition process?

To answer this question, referring to Government Regulation of the Republic of Indonesia No. 28 of 1999 states that an acquisition is carried out by taking over all or part of the shares which results in the transfer of control of the Bank to the acquiring party (Article 9 paragraph (1)). Thus, an acquisition is defined as the transfer of part or all of the shares and results in the transfer of bank control.

Furthermore, Article 10 states that to obtain an Acquisition permit, it is mandatory to fulfill the requirements, one of which is having obtained approval from the General Meeting of Shareholders (RUPS) of the Bank to be acquired or a similar meeting from a Bank that is not a Limited Liability Company as referred to in Article 7. And Article 7 states the following:

  1. Merger, Consolidation and Acquisition can only be carried out with the approval of the General Meeting of Shareholders for Banks in the form of Limited Liability Companies or similar meetings for Banks in other legal forms.
  2. Mergers, Consolidations and Acquisitions are carried out based on decisions of the General Meeting of Shareholders which are attended by shareholders representing at least ¾ (three quarters) of the total number of shares with valid voting rights and approved by at least ¾ (three quarters) of the number of shareholders present.
  3. For Banks in the form of Public Companies, if the requirements as referred to in paragraph (2) are not met, then the attendance requirements and decision-making are determined in accordance with the laws and regulations in force in the Capital Market sector.

In the author's opinion, based on the information contained in Law No. 28 of 1999, it can be concluded that the bank acquisition process can or can be done if approval has been obtained from the General Meeting of Shareholders (RUPS) of the banking itself. If minority shareholders and creditors do not approve the acquisition, the disapproval is conveyed in the GMS to obtain a resolution. This means that the acquisition is not based on customer approval but is carried out with the approval of the GMS.

When an acquisition is about to be carried out, the credibility of the prospective acquiring party is first examined through financial reports, and Article 4 states that a bank acquisition carried out on the initiative of the Bank concerned must obtain an acquisition permit from the Head of Bank Indonesia. In the case of the acquisition above, the acquisition process that was carried out had been examined in detail so that it obtained a permit from the Head of BI and the acquisition took place, so there is no need to doubt the credibility and capabilities of the bank acquirer.