BNI reports 30% increase in first-half profits

JAKARTA. State-owned lender Bank Negara Indonesia (BNI) reported a 30 percent jump in net profits to Rp 4.28 trillion (around US$423 million) during January to June, from the Rp 3.29 trillion recorded in the same period last year.

President director Gatot M. Suwondo said in Jakarta on Thursday that the increase was supported by the surge in both interest and non-interest income during the first half of this year.

The company recorded a 23.1 percent increase in net interest income to Rp 8.89 trillion in the first half of the year compared to the same period last year.

Meanwhile, its non-interest income during the first six months rose by 22 percent to Rp 4.56 trillion year-on-year.

Growing interest income was in line with the growth of the company’s lending, which rose 24 percent to Rp 222.65 trillion as of the end of June compared to Rp 179.44 trillion year on year.

“We expect there won’t be much change in lending targets despite Bank Indonesia’s [BI] recent decision to raise its benchmark rate. We’re still upbeat about our credit increasing at a range of 19-23 percent by the year end,” Gatot said.

BNI previously said it expected its lending to increase to 23-25 percent this year.

“We made the 23-25 percent increase based on our September 2012 result. The 19-23 percent growth is based on the December result, and will result in the same amount of loans,” Gatot said.

Large banks, including Bank Mandiri and Bank BCA, are cutting their loan growth target this year as the economy begins to feel the pinch from high inflation stemming from the increase in fuel prices, as well as from the impact of weak exports.

Budi Gunadi Sadikin, the president director of publicly listed Bank Mandiri, the largest bank by assets, said the bank had revised down the loan growth target to between 19 and 20 percent from the previous target of between 20 and 22 percent.

Bank Danamon has also lowered its loan growth target to 17 percent from the initial target of 18 percent. By the end of 2013, Danamon — the seventh largest bank in terms of assets — expects total loans will reach Rp 135.72 trillion.

However, this year’s loan growth rate is higher than the 14 percent recorded in 2012.

BCA president director Jahja Setiaatmadja also said recently the bank had predicted it would see slower loan growth in 2013 compared to previous years.

“Our loan growth rate was 37 percent in 2011 and 27 percent in 2012. Now our growth target is set at between 18 and 20 percent,” he said.

Gatot said, however, that BNI would likely see pressure on its net interest margin this year as it planned no increase in the interest rate following the steps of BI to raise its benchmark rate by 75 basis points to 6.5 percent earlier this month.

“Although we will see a lower margin, it won’t be less than 5.8 percent,” Gatot said. BNI’s net interest margin stood at 6.2 percent as of the end of June.

The lender’s third-party funds reached Rp 263.82 trillion at the end of June, increasing by 8.69 percent compared to the same period last year.

BNI director Yap Tjay Soen said the bank saw no liquidity problems despite slow growth in its third party funds because the bank could use the funds it raised from selling $500 million bonds last year.

Following the first half financial result announcement, shares in BNI, which are traded on the Indonesia Stock Exchange (IDX) under the code BBNI, were closed at 1.16 percent higher at Rp 4,325 apiece on Thursday. (Raras Cahyafitri)