Local banks lose $24.4b last year

JAKARTA (JP): Locally incorporated banks suffered net losses totaling Rp 166.4 trillion (about US$24.4 billion) in 1998, as compared to the Rp 2.3 trillion net income in 1997, according to the latest issue of local monthly magazine Info Bank.

The magazine's managing editor, Eko B. Supriyanto, said on Thursday that the figures were based on the 1998 financial reports published by the banks.

He said that as many as 168 banks were included in the magazine's report, but only 158 of them were assessed because the other 10 banks did not publish balance sheets for the period.

The above figure would increase by about Rp 50 trillion to Rp 216 trillion in net losses if it included also the losses suffered by these 10 banks.

The 10 banks include the four state banks (Bank Bapindo, Bank Bumi Daya, Bank Exim and Bang Dagang Negara) now in the process of being merged into newly established Bank Mandiri, which the magazine predicted to contribute about Rp 40 trillion to the total Rp 216 trillion net loss figure.

The remaining six banks are three provincial banks (BPD Lampung, BPD Maluku and BPD Timor Timur), three private banks (Bank Central Asia, Bank Nusa Nasional and Bank BNP Lippo Indonesia), which were predicted by the magazine to together contribute another Rp 10 trillion.

The magazine also said the other three state banks, namely, Bank Negara Indonesia, Bank Rakyat Indonesia and Bank Tabungan Negara, contributed a total of Rp 84.4 trillion to the figure.

"State banks are definitely the major contributors to the big total net loss figure of the 168 national banks," Eko said.

The magazine also issued a list of the worst banks for 1998, on which Bank Multicor takes first place, followed by Bank Finconesia, Bank Danamon, Bank PDFCI, Merrincorp, Inter-Pacific Bank, Bank Tabungan Negara, Bank Universal, Bank Rakyat Indonesia and May Bank Nusa International.

The magazine based its rating on several parameters including the magnitude of non-performing loan pressure on the bank, the difference between the bank's interest income and interest expenses and the bank's ability to service short-term payment obligations.

The magazine first conducted the yearly national bank ratings three years ago in 1996.

The ratings list included 215 banks in 1998, 239 banks in 197 and 240 banks in 1996.

"The decrease of the number of banks in the ratings list was due to the government's move to close down 38 banks in 1999 and another two later on during the year and freeze 7 banks in 1998," the magazine said. (udi)