BNI, BRI report higher first quarter profits
BNI, BRI report higher first quarter profits
Rendi A. Witular, The Jakarta Post, Jakarta
State-owned Bank Negara Indonesia (BNI) and Bank Rakyat
Indonesia (BNI) announced on Thursday increased earnings in the
first quarter of this year on higher income from lending
activities.
President of the publicly-listed BNI, Saefuddin Hasan, said
net profit in the first quarter rose by 2.1 percent to Rp 865
billion (about US$100 million), compared to the same period last
year.
Interest revenue from lending business increased to Rp 1.06
trillion from Rp 966 billion.
"The rise (in net profit) is relatively moderate in comparison
to last year, but looking at the source of the profit there are
indications that BNI is gradually weaning itself away from
relying on recap bonds as its main source of revenue," said
Saefuddin.
Most of the country's major banks were injected with massive
amounts of government bonds to help them stay afloat during the
late 1990s financial crisis. The banks receive interest on the
bonds, and for the past couple of years it is this interest that
has been their main source of profits as they have virtually
stopped providing loans to avoid risk.
BNI received Rp 61 trillion in recapitalization bonds, and
last year it unloaded Rp 3 trillion worth of these bonds.
Total loans channeled by BNI in the first quarter increased by
13.2 percent to Rp 38.4 trillion
The bank's capital adequacy ratio (CAR), which measures the
financial health of a bank, increased to 18.02 percent during the
quarter.
BNI also reported that its non-performing loans for the first
quarter dropped sharply from 26.81 percent in 2002 to 5.29
percent on a successful debt restructuring process and debt
write-offs.
BNI projects its net profit this year will reach Rp 2.8
trillion compared to Rp 2.5 trillion last year.
Meanwhile, BRI said that first quarter gross profit increased
to Rp 731 billion from Rp 535 billion in the same period last
year, also on higher interest revenue from loans.
BRI president Rudjito said that the bank would continue to
boost profits from its lending business, adding that it would
unload around Rp 2 trillion worth of bonds next year.
The bank plans to launch an initial public offering this year.