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Finance News |
Bank Permata's 2004 Profit Rises 12% on Lower Costs
Feb. 7 (Bloomberg)
PT Bank Permata, in which Standard Chartered Plc bought a stake last year, said profit in 2004 rose 12 percent as the lowest interest rates in six years helped it cut funding costs and boosted demand for loans.
Net income in the year ended Dec. 31 rose to 630.5 billion rupiah ($69 million), or 80 rupiah a share, from 564.5 billion rupiah, or 72 rupiah a share, in 2003, the lender said in a statement published in Bisnis Indonesia newspaper today.
``Most Indonesian banks benefited from an expanding economy and improved political climate last year,'' said Irvin Patmadiwiria, who helps manage the equivalent of $217 million at PT Batavia Prosperindo Aset Management in Jakarta. Patmadiwiria doesn't own Permata shares.
Faster economic growth is stoking corporate borrowing and consumer spending in Southeast Asia's biggest economy, which is forecast by the government to expand 5.5 percent this year, the most in nine years, after estimated 5 percent growth last year. Interest rates fell to their lowest in six years in 2004, spurring demand for bank loans and cutting deposit costs.
Permata, Indonesia's seventh-largest lender, said net interest income, or interest earned on loans after deducting that paid for deposits, rose to 1.58 trillion rupiah in 2004 from 1.16 trillion rupiah in 2003. Interest costs dropped 33 percent to 1.38 trillion rupiah.
Interest Margins
Deposit rates have fallen faster than lending rates, improving banks' interest margins. The average six- month deposit rate was 6.2 percent last year, compared with an average lending rate of 15.6 percent.
Permata's assets rose to 31.7 trillion rupiah as of Dec 31, 2004 from 29.03 trillion rupiah in 2003, the lender's statement said.
Permata is controlled by Standard Chartered, a U.K. lender that makes two-thirds of its profit in Asia, and PT Astra International, Indonesia's biggest auto distributo, which jointly paid 3.4 trillion rupiah for 62.2 percent of the lender.
The Indonesian government, which still owns 26 percent of the lender, plans to sell its remaining stake this year to raise fund to cover a buget deficit estimated at more than 17.4 trillion rupiah.
Shares of Permata, which were unchanged at 750 rupiah last year, rose 10 rupiah or 1.3 percent to 770 rupiah a share at the midday break on the Jakarta Stock Exchange today.
Bank Permata, whose name means jewel in the local language, was formed in September 2002 through the merger of PT Bank Bali, PT Bank Universal, PT Bank Arthamedia, PT Bank Prima Express and PT Bank Patriot.
Source : Bloomberg
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