Helman Sitohang’s play on Asia

By:
Eric Ellis
Published on:

Few investment bankers dominate one market as much as Credit Suisse’s Helman Sitohang does Indonesia. With other banks sensing opportunities, can his connections keep the bank ahead of the game?

Mention the name Aburizal Bakrie in the smart bars, clubs and restaurants of Singapore and Jakarta where bankers gather and the name Helman Sitohang is often uttered in the next breath.

Sitohang is Credit Suisse’s chief rainmaker in Jakarta and Singapore, a man regarded by many as perhaps the best-connected banker in Indonesia. Some of his envious colleagues even say he almost enjoys a father-son relationship with Bakrie, one of Indonesia’s richest – and most powerfully connected – businessmen.

Throughout the last 14 years, when most foreign banks, still bearing wounds from the late 1990s, wouldn't touch an Indonesia deal, Credit Suisse kept its door open in Jakarta and its Rolodex up to date. That was mostly down to Sitohang, rewarded for his efforts as co-head of Credit Suisse’s Asia-Pacific investment banking operation.

Sitohang’s Bakrie relationship has served him and Credit Suisse well, but it’s not been without its sleepless nights. As Indonesia’s highest-profile Muslim pribumi, or indigenous, business family, the Bakries have been something of a protected species in mostly Islamic Indonesia, where the business elite tends to be ethnic Chinese. Politically-wired Bakrie has been close to the wall several times, only to be bailed out or have his obligations waived in controversial deals stitched up behind official Jakarta’s secretive walls.

Shares in Bakrie’s main operating company Bumi Resources have fallen to a three-year low as the market frets about its ability to service around $4 billion in debt, most notably a pressing $1.3 billion obligation to Beijing’s state-owned China Investment Corp.

Bumi Resources’ coal reserves, gathered mostly in Kalimantan on the island of Borneo, are the mainstay of London-listed Bumi plc, which Bakrie co-owns with financier Nat Rothschild, a deal Sitohang helped set up through 2010/11.

But it’s a relationship that has often had tensions, sometimes breaking out into open warfare between the two sides as they publicly traded barbs over Bumi Resources management and debt levels. Adding to the drama is the sharp fall in coal prices in the last year, and the slowing of the Chinese economy – Bumi’s main customer.

Now operating from Singapore, Sitohang is a trusted keeper of many of the cosy Jakarta elite’s commercial secrets. It seems to help that many of them bank – mostly in secure Singapore, out of reach of grasping hands in Jakarta – with Credit Suisse’s private wealth management division. "We have this concept of ‘one bank’ and we have three big businesses – investment banking, private banking and asset management," says Sitohang. "So obviously if the clients can be serviced with more than one product, it’s a good situation. If somebody is already covering them with one product, why don’t we offer them the others."

Sitohang has been Indonesia’s top dealmaker for years, positioning Credit Suisse close to all of its big transactions, corporate and sovereign. Credit Suisse has topped the Indonesian investment banking league tables for most of the past 15 years.

Sitohang attended one of Indonesia’s most prestigious schools, the Bandung Institute of Technology, alma mater of many prominent Indonesians, including Bakrie and modern Indonesia’s founding president, Sukarno.

But Sitohang is far from being a typical Asian banker. And it also turns out he’s rather less Indonesian than many believe. He’s actually half-Slovakian, his family history a throwback to a very different kind of Indonesia.

Through the 1950s and early 1960s, at the height of the Cold War, the former Soviet bloc was locked in a fierce ideological struggle with a west led by the US. The newly independent and populous Indonesia under the leftist firebrand Sukarno was a particular Soviet favourite and Moscow wooed Jakarta with many favours.

Some of the largesse is still evident across the islands. One of southeast Asia’s biggest sporting stadiums is Gelora Bung Karno in central Jakarta, built six years after the massive Lenin Stadium was opened in Moscow by the same engineers and architects, a gift for Sukarno’s hosting of the 1962 Asian Games. The then USSR also gave rise to the modern steel industry in Indonesia, providing most of the plant that would become Indonesia’s biggest steelmaker, PT Krakatau.

The Soviets sponsored cultural and educational ties too, and it was under this programme that Sitohang’s father, an ethnic Batak from Indonesia’s northern Sumatra region, won a scholarship to study economics at Prague’s Charles University, where he met – and married – a fellow student, a Slovak from the small Tatra mountains town of Ružomberok, who is Sitohang’s mother.