Citigroup Inc in Indonesia bounced back from a banking scandal this year to top the underwriting league table for the country's international bond sales, using a dedicated team to secure the bulk of government and state-owned enterprise deals. It was a coup by the US bank over Swiss banks Credit Suisse and UBS, which have a more established corporate presence in Indonesia and regularly won mandates for government-related deals in the past, according to Thomson Reuters data.
The deals came despite a setback for Citi in May, when the central bank banned the US unit from adding new credit card clients for two years and new customers for its premium wealth services for a year. The bans stemmed from a case of alleged embezzlement by a Citibank relationship manager and the death of a client following questioning by external debt collectors working on behalf of Citi.
Germany's Deutsche Bank underwrote most stock offerings in 2011 based on value, while Citi came second. Other leading investment banks Goldman Sachs and Morgan Stanley are buying local brokerages to tap buoyant capital markets in a process likely to accelerate because Fitch Ratings last week upgraded Indonesia's status to investment grade.
"Our key success this year is that we are a full services banking house and we tailored the deal based on the clients' needs," said Tigor M Siahaan, Citi Indonesia's chief country officer. The bank last year set up a team to focus on getting deals from state-owned enterprises, popular with a government looking to benefit from initial public offerings and rights issues.
Citi reaped the reward when the government picked it to help sell $1 billion of Islamic bonds and state utility PT Perusahaan Listrik Negara chose the bank to handle its $1 billion Global bonds issue launched on two consecutive days in November at the height of the Eurozone crisis.
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