Bank Mandiri, the country’s largest lender by assets, is considering an initial public offering for its Islamic banking unit Bank Syariah Mandiri.

A possible IPO is expected to bolster the bank’s capital, Bank Mandiri president director Budi Gunadi Sadikin said in Jakarta on Thursday.

Budi was non-committal on the terms of any possible IPO including the size and total proceeds and time frame.

He did say though, that the current uncertain financial situation would not be conducive to an offering this year.

“We are waiting for the right timing,” Budi said.

Budi was appointed as president director of Bank Mandiri in May this year.

The Jakarta main stock index fell 0.7 percent to 4,389.35 on Friday in Jakarta, having risen by 1.5 percent so far this year.

Bank Syariah Mandiri is one of the more than 10 Islamic lenders operating in Indonesia.

Other syariah lenders include Bank Muamalat, Bank Syriah Mega, Bank BRI Syariah and Bank BCA Syariah.

Bank Mandiri, with assets of more than Rp 650 trillion, has six divisions including Mandiri Sekuritas, a brokerage company, Mandiri Tunas Finance, a financing unit, Bank Sinar Harapan Bali, a mid-size lender and Axa Mandiri, an insurance company.

Bank Mandiri was created by the merger of the four state lenders in 1999 in the wake of the financial crisis that hit Indonesia in the late 1990s.

Lending growth at Bank Mandiri rose more than 20 percent in the third quarter on strong demand by consumers and corporations.

The increase lifted its total loan outstanding to Rp 438 trillion ($38 billion) in the July-September period from Rp 365.2 trillion in the same period last year.

Bank Mandiri has amended its lending growth target this year to between 19 percent and 20 percent, in line with revised figures from the central bank, Bank Indonesia.

Total outstanding loans by the country’s 120 commercial banks stood at Rp 3,045 trillion at the end of July, according to central bank data.

Bank Mandiri reported a 16 percent increase in net income to Rp 8.29 trillion in the first six months of 2013. Its net interest income — from loans after deducting charges to depositors — rose 15 percent to Rp 15.4 trillion, it said in July, while its total outstanding loans at the end of June climbed 22 percent to Rp 429 trillion.

Shares of Bank Mandiri fell 0.6 percent to Rp 8,350 on the Indonesia Stock Exchange on Friday.

*This article was published by Jakarta Globe. Read the original article here.