Danamon net Rp 640b in profit

Danamon net Rp 640b in profit

PT Bank Danamon Indonesia posted a 17 percent increase in first-quarter net profit largely due to an increase in net interest income, the bank's Chief Financial Officer Vera Eve Liem told reporters on Thursday.

Net profit for the quarter rose to Rp 640 billion from Rp 548 billion in the year-ago period.

Net interest income at Indonesia's fifth-largest lender gained 10 percent to Rp 1.1 trillion from Rp 1.0 trillion due to a drop in interest payments for time deposits and an increase in lending, Vera said.

She said the bank's outstanding loans in the January-March period grew 45 percent to Rp 33.4 trillion from Rp 20.6 trillion a year earlier.

Bank Danamon's interest margin stood at 9.2 percent at the end of March, compared with 8.2 percent a year earlier.

Vera said the bank plans to maintain net interest margin between 8 percent and 9 percent for the rest 2005.

bBank Danamon's strong profit likely came from efforts to boost loans, especially to the growing consumer sector, analysts said. Indonesian consumer spending has risen sharply in the past two years because of low interest rates.

At the end of March, the bank had total assets of Rp 58.81 trillion, compared with Rp 52.68 trillion a year earlier.

Bank Danamon is majority owned by Singapore's state-owned investment company Temasek Holdings Pte. Ltd.-- Dow Jones