Mandiri posts strong profit in first half<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
Bank Mandiri, the country's largest lender by assets, said on
\nMonday it had posted a 37.2 percent increase in its net profit in
\nthe first semester this year as compared to the same period last
\nyear.<\/p>\n
The publicly listed bank's after-tax profit reached Rp 3.1
\ntrillion (some US$330 million) as of June, up from Rp 2.2
\ntrillion in the same period in 2003, the company said.<\/p>\n
The net profit increase was largely because of a 36.7 percent
\nrise in net interest income -- the margin a bank receives between
\ninterest expenses paid to depositors and interest revenue it gets
\nfrom creditors.<\/p>\n
Mandiri, along with most banks here, is enjoying hefty
\ninterest earnings in line with a declining trend in the Bank
\nIndonesia's benchmark interest rate (SBI). Banks in Indonesia
\ngenerally adjust their deposit rate downwards in line with the
\nSBI faster than they decrease their lending rates.<\/p>\n
Mandiri's net interest income stood at Rp 5 trillion in the
\nfirst half of this year, up from Rp 3.6 trillion for the same
\nperiod last year.<\/p>\n
Other crucial indicators that gauged a bank's financial health
\nwere also encouraging, the statement said.<\/p>\n
The bank's capital adequacy ratio (CAR) was at 27.5 percent,
\nfar above the 8 percent minimum requirement set by the central
\nbank. However, its non-performing loans (NPLs) rose from 7.3
\npercent in the first semester 2003 to 8.2 percent as of June this
\nyear.<\/p>\n
CAR compares a bank's capital with its risked-weighted assets
\nincluding loans.<\/p>\n
As of June, Mandiri boasted total assets of Rp 234.7 trillion,
\nincluding Rp 102.3 trillion worth of government bonds.<\/p>",
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