BNI expects to book higher bad loans

JAKARTA (JP): Publicly listed state-owned Bank Negara Indonesia (BNI) projected yesterday that its nonperforming loans would likely increase in the near future due to the economic crisis dogging the country.

BNI president Widigdo Sukarman told journalists after an extraordinary shareholders meeting that his bank's nonperforming loans currently stood at 5.9 percent of its total credits of Rp 30.15 trillion (US$5.79 billion) as of last September.

Bad loans accounted for less than 1 percent of BNI's total credits as of last September, Widigdo said.

"Due to the current crisis, we expect that nonperforming loans will increase in the near future. Already, many companies are facing a difficult time, especially those operating with much import content," Widigdo said.

"And to anticipate such a possible increasing loans problem, we significantly increased our reserves for nonperforming loans," he added.

He said BNI had raised reserves for nonperforming loans by 77.2 percent to Rp 755.58 billion as of last September from Rp 426.49 in September 1996.

As of last September, BNI had collected Rp 21.19 trillion in third party funds, a 18.83 percent increase from 18.12 trillion in September last year.

BNI's total assets rose 34.7 percent to Rp 44.43 trillion from Rp 32.98 trillion.

Yesterday's extraordinary shareholders meeting reinstated Sarmono Warnopuspito as the bank's chief commissioner until the next shareholders' meeting. (rid)