BCA 2004 net profit up 33%

PT Bank Central Asia's 2004 net profit jumped 33 percent to Rp 3.2 trillion (US$341 million) due to a rise in net interest income, BCA President Djohan Emir Setijoso told reporters on Tuesday.

Net interest income for Indonesia's second-largest bank in terms of assets rose 25 percent year-on-year to Rp 6.6 trillion from Rp 5.3 trillion, thanks to lower interest rates that helped cut interest expenses.

The bank's net interest margin last year was 5.28 percent compared with 4.93 percent in 2003.

Djohan also attributed the rise in net profit to increased lending during the period, underscoring the bank's ability to generate income from its intermediary services.

Outstanding loans rose to Rp 40.4 trillion as of Dec. 31 from Rp 29.22 trillion a year earlier. Its lending ratio was at 30.6 percent, compared with 24.6 percent in the previous year.

"Our lending expansion last year contributed to higher interest income, which in turn pushed up our bottom-line," Djohan added.

However, the rise in these loans dragged the bank's capital adequacy ratio down to 23.95 percent from 27.95 percent. The figure, however, is still well above the mandatory 8 percent minimum level set by the central bank.

BCA has said it expects lending this year to grow by 20 percent.

Farindo Investment Ltd. owns a 52 percent stake in the bank, the Indonesian government holds a 0.5 percent stake, the public owns 42 percent, and individual investors hold the remaining stake. -- Dow Jones