Panin focuses new loans on retail sector

Tony Hotland, The Jakarta Post/Jakarta

Publicly listed Panin Bank wishes to channel more loans to the retail sector in the coming years to capitalize on the growing demand.

"This year, we have targeted to add another Rp 2 trillion in loans, or about 20 percent, from our total loans last year. We expect to channel the loans more to the retail sector," Panin deputy director Roosniati Salihin said on Thursday after the launch of the bank's newest product MagnaCard.

Panin channeled Rp 8.26 trillion (US$897.83 million) in loans in 2003. By the end of June, the bank had disbursed Rp 10.09 trillion. With total assets of Rp 21.36 trillion, Panin's loan to deposit ratio (LDR) stands at 71.13 percent.

Roosniati said that currently, 60 percent of the bank's loans went to corporations, while the rest went to consumers and small and medium-sized enterprises.

"We have a target of equaling the percentage," she added.

Panin, one of the few banks that survived the financial crisis in the late 1990s without the help of the government's bail-out program, recorded a staggering 315 percent increase in its after- tax profit last year due to a rise in net interest margin.

It booked Rp 418.5 billion in profit, surging high from Rp 101 billion recorded in 2002.

Regarding the bank's plan to acquire the government's major shares in Bank Permata, Roosniati stated that the management of Panin had yet to hold discussions with other parties about the possibility of forming a consortium.

"We've talked only with (Australia-based) ANZ, but that's because ANZ owns 29 percent of Panin shares. Even if we didn't acquire Permata, we could always acquire shares in other banks in the future as part of our efforts to increase our assets," said Roosniati.

She, however, refused to disclose whether Panin had sent a bidding letter to the Asset Management Company (PPA), only saying that "we'll do everything by the procedures".

The PPA, which now manages the government's shares in Permata, puts the deadline for bidding letters on August 23.

Also on Thursday, Panin launched its MagnaCard, which can function as both an ATM card and a Debit card.

The bank collaborates with payment company MasterCard International, allowing the card owners to be able to use the card in over 900,000 MasterCard's ATMs across the globe.