BDNI expects higher amount of loan defaults

JAKARTA (JP): Publicly listed PT Bank Dagang Nasional Indonesia (BDNI) expects a higher amount of loan defaults this year due to the country's economic crisis.

The bank said in a statement yesterday that it had increased its loan loss provision by over 300 percent to Rp 118.2 billion (US$35.81 million) in the third quarter of this year from Rp 28 billion in the corresponding period last year to anticipate a possible increase in nonperforming loans.

The bank's nonperforming loans in the third quarter represented slightly less than 1 percent of total loans.

But over the next 12 months, given the current economic crisis, the bank expects that this figure will rise to 3 percent of total loans.

Its loan loss allowance at the end of this year's third quarter was 1.7 percent.

The bank said the level of loan loss allowance would be steadily increased to cover the anticipated rise in nonperforming loans in the coming months.

The bank also said the rupiah's depreciation against the U.S. dollar from June to September had significantly increased third quarter balance sheet line items, because a large amount of its assets and liabilities were denominated in dollars.

The bank booked Rp 24.4 trillion in assets as of Sept. 30, or an increase of 62 percent from Rp 15 trillion over the same period last year.

Net income after taxes jumped 64 percent to Rp 201.6 billion in the first three quarters this year, from Rp 123.4 billion in the same period last year.

Net income increased 25 percent compared to profits of Rp 160.7 billion in the first half this year.

Its profit in the third quarter was driven by a 70 percent increase in operating income which totaled Rp 664.7 billion.

BDNI's foreign exchange earnings rose 37 percent to Rp 88.1 billion from Rp 64.1 billion in last year's third quarter.

Foreign exchange earnings in the period were 44 percent higher than the Rp 61.1 billion recorded in this year's first half.

Bank deposits grew 51 percent to Rp 15.3 trillion from Rp 10.1 trillion in last year's third quarter. Deposits increased 19 percent over the Rp 12.8 trillion recorded in the first half this year.

The bank booked a regulatory loan to deposit ratio of 93.6 percent, compared to 95.5 percent in the third quarter last year and 95.9 percent in the first half this year.

The bank's capital adequacy ratio was 10 percent, compared to 8.8 percent in last year's third quarter.

Its loans grew by 58 percent to Rp 18.9 trillion in the third quarter from Rp 11.9 trillion in the third quarter last year, and by 16 percent (2 percent on a constant dollar basis) over Rp 16.2 trillion in the first half this year.

The bank said the increase was mainly due to the exchange rate adjustment applied to existing loans.

The bank's loan portfolios were diversified in many sectors, including trade (45 percent), business services (20 percent), manufacturing (15 percent), agriculture (12 percent), construction (6 percent) and others (2 percent).

BDNI, which was founded in Medan in 1945, also cooperates with state-owned electricity company PT PLN and state-run telecommunications company PT Telkom for the payment of electricity and telephone bills.

It is owned by PT Daya Patria Corp (51.84 percent), PT Nusantara Duta Development Corp (5.1 percent), PT Nusantour Duta Djaya Invest Corp (3.2 percent) and public shareholders (39.86 percent). (08)