BCA forecasts 2004 profit at Rp3.1 trillion

BCA forecasts 2004 profit at Rp3.1 trillion

PT Bank Central Asia, Indonesia's second-largest lender by assets, expects a 30 percent increase in profit this year as faster economic growth spurs borrowing by Indonesian consumers and companies.

"Our profit is forecast to reach Rp 3.1 trillion (US$341.8 million) this year," Jahja Setiaatmadja, finance director at the lender, said in Jakarta on Thursday.

Bank Central Asia and other Indonesian lenders are expanding loans to consumers, whose spending accounts for 70 percent of the $208 billion economy.

Demand for credit is expanding in an economy the government forecasts will grow as much as 5.4 percent next year, up from as much as 4.8 percent this year.

The lender also expects its profit to rise to between Rp 3.4 trillion and Rp 3.5 trillion next year on the higher economic growth, Setiaatmadja said.

The lender, a unit of U.S. hedge fund Farallon Capital Management LLC, had a net income of Rp 2.39 trillion last year. In the first nine months ended Sept. 30, Jakarta-based Bank Central Asia's net income rose to Rp 2.34 trillion from Rp 1.67 trillion a year earlier.

Shares of Bank Central Asia, which have risen 65 percent this year, rose Rp 100 or 3.7 percent to Rp 2,750 at the close of trading on the Jakarta Stock Exchange today.

Bank Central Asia has targeted extending as much as Rp 10 trillion in new loans this year, from Rp 9 trillion last year. It expects to make Rp 4 trillion of new loans in the second half of 2004.

Total outstanding loans in the first nine months rose 47 percent to Rp 35.96 trillion. Loans to small businesses accounted for 44 percent of total loans, with loans to large corporate groups representing 42 percent, the lender said in a statement last month. -- Bloomberg