Bank Universal decides not to pay dividend

JAKARTA (JP): Publicly listed Bank Universal, a subsidiary of widely diversified Astra International, will not pay a dividend for the company's 1997 earnings in a move to safeguard its capital, its president said yesterday.

Stephen Z. Satyahadi said a proposal on not paying the dividend was one of several corporate plans approved by the bank's shareholders in an annual shareholders meeting yesterday.

He said that all the bank's profits last year would be used to strengthen its capital as a crucial business strategy to enable the bank to weather the economic crisis.

"Our chief commissioner, Bapak Sumitro Djojohadikusumo, said that a bank with stronger capital would survive longer, and our shareholders agreed with him. I hope the effort will enable our bank to cope with the current crisis," Stephen said.

Bank Universal's net profit plunged 52.62 percent to Rp 10.39 billion last year from Rp 21.94 billion in 1996.

Stephen said the decline was partly due to the increase in the company's operation costs.

He added that its total assets as of December last year rose to Rp 5.74 trillion, an increase by 65.67 percent from its figure last year. Its capital last year rose by 328 percent to Rp 535.34 billion from 162.78 billion in 1996.

Stephen also announced that as of May 20, Bank Universal was 83.74 percent owned by publicly listed PT Astra International, 3.69 percent by PT Prahabima, 2.10 percent by PT Telkom's Pension Fund Foundation, 1.05 percent by Bank Negara Indonesia's Pension Fund and 0.35 percent by Nomura Singapore Ltd. The remaining 9.07 percent is owned by the public.

Stephen said former president Soeharto's daughter Siti Hediati Prabowo only held 0.92 percent of Bank Universal's total stake through her ownership in PT Prahabima.

He added that PT Prahabima was owned by Sumitro Djojohadikusumo's family, whose son Prabowo is Siti Hediati's husband.

"Hediati's stake in bank Universal is only 0.92 percent. She even holds it through her ownership in her father-in-law's company PT Prahabima."

He said Bank Universal was managed professionally and had been appointed by the government as one of 31 banks to issue letters of credits (L/Cs) backed by U.S credit guarantees.

Bank Universal director Jerry Ng said the company suffered a loss of approximately Rp 56 million due to damage to its six branch offices in Jakarta in riots last month.

"But the loss will not affect our performance this year because it is so little compared to our profit," he said. He added that the company expected flat growth this year.

Bank Universal booked Rp 7 billion in earnings after tax in this year's first quarter. Its assets stood at Rp 7.73 trillion as of March 30. (gis)