Bumiputera profit increases by 13.8 percent

The Jakarta Post, Jakarta

A significant growth in the number of savings accounts helped PT Bank Bumiputera Indonesia Tbk. to book a 13.8 percent increase in its 2004 yearly after-tax profit to Rp 31.6 billion (US$3.37 million) from Rp 27.8 billion in the previous year.

Bumiputera said in its release that with the profit growth, the bank decided to give 25 percent of the net profit to its shareholders in the amount of Rp 3.95 per share.

The increase was contributed largely from a 110.5 percent growth in the bank's savings accounts from Rp 234.3 billion in 2003 to Rp 492.4 billion in 2004. The amount of savings has doubled partly due to the success of its savings account product known as Bung HARI.

The increase in savings helped Bumiputera's loan to deposit (LDR) ratio to decrease from 96.21 percent in 2003 to 83.76 percent last year due to the growth in its third party fund.

The significant increase has also contributed to a raise in Bumiputera's net interest margin from 5.84 percent in 2003 to 6.91 percent in 2004.

However, the bank's loan disbursement only increased by 1.1 percent last year to Rp 2.55 trillion from Rp 2.52 trillion in 2003.

The mediocre increase in the bank's loans was due to a consideration of maintaining its capital adequacy ratio (CAR) at 10.16 percent. In 2003, the bank's CAR stood at 9.87 percent.

Meanwhile, its non performing loans (NPL) ratio stood at 3.33 percent. Both ratios are key indicators to gauge a bank's financial health. (003)