Jakarta. Bank Tabungan Negara has secured a Rp 11.4 trillion ($789 million) loan from Bank ICBC Indonesia, the local unit of China's largest lender, to finance part of Indonesia's "one million houses" program.
BTN, the country's biggest mortgage lender, will withdraw the loan in stages over the next three years. The loan will carry the same interest rate as the Shanghai Interbank Offered Rate, BTN's president director Maryono said on Wednesday.
"This is cheaper than taking a loan in US dollars," he said, adding that BTN declined to accept US-denominated loan offers from the International Financing Corporation, the private-sector financing arm of the World Bank.
The state-owned bank estimates that it will need more than Rp 40 trillion for the government-sponsored program over the next few years, Maryono said.
The program provides subsidies for down payments and mortgages to alleviate the country's housing backlog.