BRI to make Rp 12t new loans next year

BRI to make Rp 12t new loans next year

Bank Rakyat Indonesia, the nation's fourth-largest lender, expects to give Rp 12 trillion (US$1.3 billion) of new loans next year as consumers and companies borrow more.

The figure marks a 9 percent increase over the 2004 target, which has already been achieved, the lender said.

"The bulk of the loans will be for small and medium enterprises," Finance Director Wayan Alit Antara told reporters in Jakarta.

BRI and other Indonesian lenders are trying to capitalize on increased borrowing by consumers and companies after three peaceful elections, including the first direct presidential poll, bolstered confidence in Southeast Asia's largest economy. The $208 billion economy is forecast by the government to expand 5.4 percent next year and 4.8 percent this year, from 4.5 percent growth last year.

Cheaper loans are helping spur the construction of homes and shopping malls and fuel consumer spending, which already accounts for more than two-thirds of the economy.

BRI, a state-controlled lender that 3,931 branches across Indonesia, targeted extending 11 trillion rupiah of new loans this year. It gave Rp 8.22 trillion of loans last year. Most of Bank Rakyat's loans are to small-and medium-sized businesses.

"We reached our loan target this year." Antara said.

In the first nine months of this year, profit rose to Rp 2.74 trillion from Rp 1.82 trillion a year earlier, it said in a statement this month. Net interest income, or interest revenue from borrowers after interest was paid to depositors, rose 38.8 percent to Rp 7.98 trillion from Rp 5.75 trillion a year earlier. -- Bloomberg