BCA Q1 net rises to Rp 837 billion

BCA Q1 net rises to Rp 837 billion

Bloomberg/Jakarta

PT Bank Central Asia, Indonesia's second-largest lender by assets, said first-quarter profit rose about 9 percent as it earned more interest income by expanding lending. The bank said it's planning a share buyback.

Net income in the three months ended March 31 rose to Rp 837 billion (US$87.4 million), or Rp 68 a share from, Rp 768 billion , or Rp 124 a share, a year earlier, the bank said in a statement.

Indonesian lenders are benefiting as an expanding economy spurs companies to invest and consumers to spend more after interest rates last year fell to the lowest in six years. The $222 billion economy, Southeast Asia's largest, is forecast by the government to expand 5.5 percent this year, the most in nine years, after 5.1 percent growth in 2004.

Bank Central Asia's net interest income, or interest revenue from borrowers after interest was paid to depositors, rose to Rp 1.81 trillion in the first quarter from Rp 1.57 trillion a year earlier.

The lender proposes to buy back 600 million shares, pending shareholders' approval, Chief Financial Officer Jahja Setiaatmadja said at press conference in Jakarta. The shares have a market value of Rp 1.91 trillion at today's price.

"Some foreign investors perceive Bank Central Asia as over- capitalized -- our capital adequacy ratio stands at 26 percent, above the central bank requirement of 8 percent," he said. "We don't know when to conduct the buyback."

He didn't say at what price the lender will consider buying back the shares. Bank Central Asia has Rp 2.1 trillion to finance the share buyback, he said.

Bank Central Asia has total assets of Rp 148.06 trillion, the statement said.

The comments came after the market close. The shares fell 0.8 percent to 3175, reducing the gain since the year started to 6.7 percent.