State banks to pay less dividends
Nani Afrida, The Jakarta Post, Jakarta | Mon, 05/24/2010 11:33 AM
The government has agreed to receive less dividends from Indonesia's four state banks, allowing them to retain more capital for their own use to enable them to strengthen their capital structures and facilitate expansion, a minister has said.
State-Owned Enterprises Minister Mustafa Abubakar said last week that with lower dividends, the state banks could retain the larger part of their last year's profits to support their planned lending expansion in the current year.
"We expects to get higher dividend payment from other state firms to meet the state budget target," he said, adding that despite this move the state enterprises ministry was still targeting to contribute Rp 29.5 trillion in dividends to the state budget this year.
The government usually takes 50 percent of state banks' net profits as a dividend. But this year, he said, the government will only take between 30 and 35 percent of state bank profits as its dividend.
Indonesia has four state banks: PT Bank Mandiri, PT BRI, PT BNI and PT Bank Tabungan Negara (BTN).
The combined net profits of the four state-owned banks were about Rp 17.4 trillion last year.
Bank Mandiri, the largest state bank in total assets, booked Rp 7.16 trillion in net profit in 2009, up from Rp 5.31 trillion a year earlier, while the net profit of BRI rose 23 percent to Rp 7.30 trillion in 2009.
BTN made a net profit of Rp 490 billion in 2009, an increase up from Rp 430 billion in 2008. BNI's net profits more than doubled to Rp 2.48 trillion in 2009 from Rp 1.22 trillion in the previous year.
In order to meet the government budget target for dividends this year, the government plans to seek higher dividend payments from state companies operating in extractive industries such as Pertamina and PT Aneka Tambang.
"We will also ask state toll operator PT Jasa Marga to increase its dividend payout rate to up to 60 percent up from 50 percent in previous years," Mustafa said.
Mustafa acknowledged these state companies still needed extra funds to make investments and to expand their businesses.
