PermataBank clarifies

With regard to the news report about PermataBank on Nov. 16, page 14, which was excerpted by The Jakarta Post from Bloomberg we would like to thank you for the publication.

However, there are a few matters related to the article that should be clarified as follows.

Your headline says: Bank Permata 2005 earnings may fall, official says. It is stated: "Our profit may fall to below 472 billion rupiah (US$47.1 million) this year, said Saptono."

We never made this statement to Bloomberg. We just mentioned that the bank's profit up to September 2005 was IDR 184 billion and the net profit up to September 2004 was IDR 489 billion.

We had correspondence with Bloomberg related to the news report with explanations as follows:

* In response to the question as to why Q3 profit decreased compared to the previous year, we explained that this was due to a combination of factors including: - Investments that the Bank made this year which were reflected in increase of expenses. - Loss of IDR 30 billion from Mark-to-Market value of government bonds. - Higher provisions for bad debts of approximately IDR 131 billion, which was partially due to the new Bank Indonesia regulation on asset portfolio reclassification.

* In response to the question as to whether the decrease in Q3 profits compared to the previous year reflects the poor performance of PermataBank's current management, I explained that this was not necessarily the case because last year's results were not exactly an apple-to-apple comparison with this year's.

I further explained that there were two significant variables PermataBank enjoyed last year that we could not possibly be repeated this year. These included the reversal of merger costs injected by the government during the recap period of around IDR 144 billion which boosted our other operating income and the tax loss carry-forward situation PermataBank still enjoyed as a result of the merger/recap three years ago.

IMAM TEGUH SAPTONO, General Manager Corporate Secretary, PermataBank, Jakarta

Note: Thank you for the clarification.

--Editor