Bank Mandiri expects Rp 725b net profit this year<\/p>\n
JAKARTA (JP): President of Bank Mandiri Robby Djohan expects
\nthe giant state-owned bank to book a net profit of Rp 725 billion
\n(US$97.32 million) in net profit this year, compared to a loss of
\nRp 36.86 trillion last year.<\/p>\n
Speaking at a hearing with the House of Representatives
\nCommission IX on finance and state budget, Robby said that net
\nprofit per February 2000 was Rp 318 billion.<\/p>\n
He said that the bank would provide around Rp 8 trillion in
\nnew lending this year, an increase of 4 percent.<\/p>\n
He said that some Rp 3.98 trillion of the new lending would be
\nin the form of corporate lending, and Rp 4.09 trillion in
\ncommercial and retail loans.<\/p>\n
He said that most of the new lending would be directed toward
\nthe export industry, pulp and paper, palm oil and plantation
\nindustry, and consumer products.<\/p>\n
\"There's been strong demand for consumer products. Even
\nforeign investors are seeking to buy (Indonesian) consumer
\nproducts industry,\" he said.<\/p>\n
Robby said that the relatively low 4 percent growth was due to
\nthe current stagnant market.<\/p>\n
\"We don't want to push the asset growth to 10 percent or 20
\npercent amid the current conditions or we will be facing the same
\nbad debt problem again,\" he said.<\/p>\n
He said that the Rp 8 trillion lending volume already
\nrepresented a 30 percent share of the domestic loan market.<\/p>\n
Bank Mandiri was formed last year by merging four ailing state
\nbanks including Bank Bumi Daya (BBD), Bank Ekspor Impor Indonesia
\n(Exim), Bank Dagang Negara (BDN), and Bank Pembangunan Indonesia
\n(Bapindo).<\/p>\n
The government completed recapitalization of the bank last
\nyear by injecting some Rp 178 trillion worth of bonds to boost
\nits capital adequacy ratio (CAR) to 12.8 percent at end of
\nJanuary.<\/p>\n
Robby said that Bank Mandiri's assets at end of December
\ntotaled Rp 221 trillion.<\/p>\n
He said that the bank's return on equity was expected to reach
\n22.46 percent this year and return on assets to reach 1.33
\npercent.<\/p>\n
Bank Mandiri is planning to offer from 25 percent to 30
\npercent of its shares through an initial public offering (IPO)
\nearly next year in a bid to raise around US$1.5 billion.<\/p>\n
Robby said that five world-class investment banks had applied
\nto become the lead underwriter of the IPO.<\/p>\n
\"I'm optimistic that the $1.5 billion target can be
\nfulfilled ... as long as there's no negative news (on Bank
\nMandiri),\" he said.<\/p>\n
\"The success of the IPO will not only benefit Bank Mandiri but
\nalso the whole economy,\" he added.<\/p>\n
Asked if he had already picked any successor, Robby said: \"I
\nexpect my successor to come from the inside. There's plenty of
\nbrilliant young people here (in the bank).\"<\/p>\n
There have been rumors that Bank Mandiri managing director
\nAgus Martowardojo is favored as Robby's successor.<\/p>\n
\"I don't have problems if I have to step down from Bank
\nMandiri. But I expect to be able to lead the bank at least until
\nthe completion of the IPO,\" Robby said.<\/p>\n
Robby said that one of the most challenging tasks now was how
\nto change the culture of the bank's staff from a bureaucracy
\norientation to a market orientation.<\/p>\n
\"It is very painful to see that our cultural development has
\nbeen slow,\" he said, pointing out that this was mostly observed
\nin the bank's branch offices scattered throughout the region.<\/p>\n
Bank Mandiri now has a total of 630 branches, compared to 740
\nbefore the merger. The bank is expected to reduce the branches
\nto around 546 by the end of this year.(rei)<\/p>",
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