Find Article by Date
Thu, 17 Dec 1998

JP/Bank Mayapada announces 9.16 percent CAR after audit

Bank Mayapada announces 9.16 percent CAR after audit

JAKARTA (JP): Publicly listed Bank Mayapada Internasional revealed on Wednesday that its capital adequacy ratio (CAR) was 9.16 percent, according to a financial due diligence audit conducted by international auditors.

The bank said in a media statement that the CAR level was above the government's year-end minimum requirement of 4 percent, and the minimum level of 8 percent set by the Bank for International Settlement.

Bank Mayapada is the first to announce publicly its CAR status, following Minister of Finance Bambang Subianto's announcement last week on the initial result of the government- sponsored due diligence.

Bambang said only 54 commercial banks had a CAR level of more than 4 percent. He declined to disclose any names, but pledged that he would make the disclosure in January.

The announcement was based on financial audit results on the country's 166 commercial banks. Seventy banks were revealed to have CAR levels of between minus 25 percent and plus 4 percent. These banks will have to join the recapitalization program to meet the year-end minimum CAR requirement if they want to survive.

The remaining banks have a CAR level of less than minus 25 percent, meaning that they are not eligible to join the recapitalization program.

The banks have been given until the end of this month to take measures, such as merging or injecting fresh capital in order to be eligible to the recapitalization program.

The banks with a CAR of above 4 percent will not have to join the recapitalization program.

Bank Mayapada was established in 1990, became a foreign exchange bank in 1993, and was listed on the stock exchange in August 1997. At the end of September 1998, the bank had total assets of Rp 880.49 billion, outstanding credit of Rp 454.51 billion, and third party funds (deposits) of Rp 604.3 billion .

The bank said that although it expected to book a profit this year, its profitability had deteriorated due to the negative spread suffered by the banking sector as a whole. (rei)