An Indonesian bank that is majority-owned by OCBC is looking to create an onshore private bank in the Asian jurisdiction, prompted by a shift due to a major tax amnesty programme.

The Indonesia unit of Singapore-listed Oversea-Chinese Banking Corp is setting up a private banking business to exploit the billions of dollars of assets recently declared by locals under a tax amnesty, which expires at the end of March, according to Bloomberg.

PT Bank OCBC NISP is waiting to win approval from Indonesia’s financial services authority, or OJK, before it creates the private bank, Parwati Surjaudaja, the lender’s Jakarta-based president director, was quoted as telling the news service.

WealthBriefingAsia has contacted OCBC for confirmation of the report, and further details. It may update in due course.

“The tax amnesty has created new momentum for the wealth management industry,” she was quoted as having said. “It is becoming a necessity for banks here to be able to offer a variety of customised wealth products that suits the needs of our Indonesian customers.”

This publication has already examined how the amnesty, which has so far prompted people to report on $338 billion in previously undeclared funds, is causing banks located in offshore centres such as Singapore to reconsider how they book business in future to avoid losing lucrative revenue. (To see an article on this topic, click here.) As the Bloomberg article stated, about a quarter of the $338 billion of undeclared money is located outside Indonesia.

OCBC became a controlling shareholder of the Indonesia entity, PT Bank OCBC NISP, in 2004.

The group already has a private banking operation with multiple offices - Bank of Singapore.