Lippobank reports 32% increase in profit

Lippobank reports 32% increase in profit

JAKARTA (JP): PT Lippobank, affiliated with the Lippo Group,
yesterday announced a 32.3 percent increase in its after-tax
profit to Rp 42.43 billion (US$19.72 million) last year from the
previous year.

"Our before-tax profit also showed a significant climb to Rp
66.04 billion from Rp 48.94 billion," Lippobank's vice president
Eddy Handoko told reporters after an extraordinary meeting of the
company's shareholders here yesterday.

"We expect that our profit will grow by over 25 percent this
year due to the improved business climate," he said.

He pointed out that the increase in profits was partly caused
by a sharp jump in the bank's fee-based revenues by 63.5 percent
to Rp 37.27 billion.

"We are optimistic that the fee-based revenues will grow by
about 30 percent this year," he added.

Handoko said the bank's net interest revenues increased to Rp
261.7 billion last year from Rp 218.26 billion in 1992.

He said the ratio of the bank's return on equity improved to
17.49 percent last year from 16.62 percent in 1992, while that of
return on assets rose to 0.99 percent from 0.93 percent.

Overseas offices

Lippobank, which has a subsidiary in Australia and branch
offices in Sydney, Bangkok, Kuala Lumpur, Hanoi and Ho Chi Minh
City, reported that its total assets last year surged by 28
percent to Rp 4.90 trillion from the previous year.

He also said that its loan-to-deposit ratio (LDR) stood at
83.6 percent last year, far higher than the 69.2 percent of a
year earlier.

"We consider last year's LDR as conservative due to our strong
loan portfolio," he said.

"Of our Rp 3.38 trillion loan portfolio, 60 percent was
channeled for retail trading activities, 20 percent for consumer
loans and the remaining 20 percent for middle-class business
activities," he said.

According to Handoko, shareholders at yesterday's meeting also
approved management's proposal to pay a cash dividend of Rp 60
per share on July 9 and to give bonus shares in November.

For the bonus share scheme, every two existing shares will be
entitled to receive one bonus share, he said.

The bonus shares would be issued from the capitalization of
Lippobank's agio or the capital gain collected during its public
offering in November 1989. The conversion of the agio into its
paid-up capital will automatically dilute share prices.

Handoko also said that yesterday's meeting also approved the
bank's plan to move its operational headquarters to the Lippo
Village in Karawaci.

"We will soon report the move to Bank Indonesia, the central
bank," he added.

He pointed out that the new 20-story headquarters, called the
Asia Tower, will cost the company around $13 million.

"It will be operational in September or December this year,"
he added. (fhp)