BCA net profit up 47.29% in first-half<\/p>\n
Rendi A. Witular, Jakarta<\/p>\n
Publicly listed Bank Central Asia (BCA), the nation's second
\nlargest bank in terms of assets, announced on Wednesday a 47.29
\npercent increase in first-half net profit as compared to the same
\nperiod last year, mostly on the reduced cost of funds.<\/p>\n
BCA president director Djohan Emir Setijoso said the bank
\nposted a net profit of Rp 1.50 trillion (US$159.9 million) in the
\nperiod ending June, as against Rp 1.01 trillion in the
\ncorresponding period the year before.<\/p>\n
\"The profit increase is attributed primarily to the lower cost
\nof funds,\" said Setijoso at a news conference on Wednesday.<\/p>\n
BCA gross interest income fell by 15 percent to Rp 5.61
\ntrillion from Rp 6.49 trillion as revenue from government
\nrecapitalization bonds dropped due to lower interest rates.<\/p>\n
The decline in the Bank Indonesia benchmark rate impacted BCA
\nheavily because most of its recap bonds, which totaled Rp 42.63
\ntrillion as of June, carry a variable interest rate that is
\nlinked to the BI rate.<\/p>\n
At the same time, the bank also enjoyed profit from declining
\ninterest rates that reduced expenses in paying depositors. BCA's
\ntotal interest expenses dropped to Rp 2.41 trillion in the first
\nhalf from Rp 3.89 trillion in the same period of last year.<\/p>\n
The gap between its lending rates and the interest it pays on
\ndeposits increased the bank's net interest income to Rp 3.19
\ntrillion from Rp 2.60 trillion.<\/p>\n
BCA said that outstanding loans grew by 50.32 percent, or Rp
\n11.2 trillion, to Rp 33.47 trillion, with loans to the corporate
\nsector making up 43.43 percent of the bank's total lending
\nportfolio, while the remaining 43.51 percent went to the
\ncommercial sector and 13.06 percent to the consumer sector.<\/p>\n
The bank has targeted lending to grow by between Rp 8 trillion
\nand Rp 10 trillion this year.<\/p>\n
During the briefing, BCA finance director Jahja Setiaatmadja
\nsaid that BCA would suffer potential losses of around Rp 120
\nbillion per year, or Rp 12 billion per month, as a consequence of
\nthe central bank's decision to raise the minimum reserves
\nrequirement to 5 percent from 3 percent.<\/p>\n
\"There will be a potential loss due to the policy because we
\nwill only receive 3 percent interest on the money used as
\nreserves, lower than the 7.5 percent interest received from
\ngovernment bonds,\" he said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bca-net-profit-up-4729-in-first-half-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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