BNI allocates $80m for new ATMs, Internet banking

JAKARTA (JP): Publicly listed Bank Negara Indonesia (BNI) will allocate about US$80 million in new investment to increase its automated teller machines (ATMs).

The bank's president, Saifuddien Hasan, said on Thursday that BNI planned to install 400 new ATMs this year to increase its units to 1,538.

He said part of the money would be used to prepare for the bank's Internet banking service later this year.

"The improvement reflects our commitment to serve our customers better, especially in the retail market," he told reporters after the bank's public presentation, adding that the plan would be supported by IBM.

Saifuddien said the new ATMs would be installed in major cities in West Java, Central Java, East Java, North Sumatra, Bali and South Sulawesi.

At the end of 2000, the bank had 1,138 ATMs and 750 branches, which received 70 percent of its total funding from the retail market.

Saifuddien said the bank's loans, channeled to retail clients during the first quarter of this year, accounted for more than 90 percent of the total credits during the period.

He added that the total loan channeled during the January to March period reached Rp 1.6 trillion or 46.5 percent of the Rp 3.4 trillion in new credits targeted for the whole year.

The number helped push the bank's total outstanding loans to Rp 32.65 trillion during the period or 16.4 percent higher than the Rp 28.04 trillion booked in the same period of last year.

BNI's consolidated net profit rose by 152.5 percent to Rp 700.9 billion in the January to March period from a loss of Rp 1.3 trillion in the first quarter of last year, Saifuddien, said, adding that the profit exceeded its initial target of Rp 370.3 billion.

The bank's high growth of profit was attributed to a higher interest income.

According to him, BNI's net interest income surged 186.4 percent to Rp 805 billion, compared to a loss of Rp 931.3 billion in interest income in the same period of last year, partly due to the interest payment of the government recapitalization bonds.

Its other operating income rose 63 percent to Rp 494 billion from Rp 303 billion, which mainly came from foreign exchange transactions, Saifuddien added.

BNI's operating expenses increased 27.5 percent to Rp 454 billion from Rp 356 billion in the same period last year due to administrative expenses as well as higher inflation rates, he said.

BNI's capital adequacy ratio (CAR) reached 14.11 percent, while its nonperforming loan (NPL) stood at 24.9 percent.

Indonesian banks should meet the central bank's requirement of a CAR of at least 8 percent and a maximum NPL of 5 percent by the end of this year.

Saifuddien said the bank was also targeting a net profit of Rp 1.48 trillion in 2001. It lost Rp 1.23 trillion in 2000.

He said NPL would decline to 5 percent this year from 33.3 percent at the end of 2000.

The bank's CAR was expected to reach 18.5 percent at the end of this year, up from 13.6 percent at the end of last year.

Hasan said the bank would reach its profit target this year as long as Bank Indonesia SBI certificate rates did not rise above 19 percent. (05)