T

he country'€™s major lenders '€” Bank Mandiri, Bank Central Asia (BCA) and Bank Permata '€” revealed on Wednesday their financial reports in which they booked higher than industry performances in the first nine-months of 2013.

State-owned Mandiri said the booming business from January to September had driven its total assets to exceed Rp 700 trillion (US$62.72 billion) for the first time. As of now, it remains the country'€™s largest bank by assets.

Its net profits soared 15.1 percent to Rp 12.8 trillion.

Mandiri vice president director Riswinandi said although the domestic economy had slowed during this period, the lender was still able to see increases in both its lending and deposit portfolios.

Between January and September, Mandiri'€™s outstanding loans surged 23.4 percent to Rp 450.8 trillion, driven by its micro loans segment, which rose 48.6 percent year-on-year to Rp 24.9 trillion.

Meanwhile, the latest data from Bank Indonesia (BI) reveals average credit growth in the banking industry revolves around 20 percent.

According to Mandiri finance and strategy director Pahala N. Mansury, the productive sector (such as manufacturing, farming, trading and mining) continues to dominate its overall lending business with 86.1 percent. '€œMost of the lending is disbursed for investment and working capital loans,'€ he said.

In third-party funds (DPK), the bank posted a 19.3 percent increase to Rp 514.22 trillion. With the latest results, Mandiri'€™s loan-to-deposit ratio (LDR) stood at 87.3 percent, up from the 84.4 percent recorded a year ago.

'€œThe higher LDR was a result of our credit expansion. We aim at keeping the ratio at 85 percent by year-end as we plan to boost our DPK in the fourth quarter,'€ Mandiri president director Budi Gunadi Sadikin said.

Budi predicted business would slow in 2014, growing at a rate below 20 percent, which he claimed as its '€œnormal'€ rate. '€œNext year will be more of a stability year, rather than a growth year,'€ he added.

Separately, BCA president director Jahja Setiaatmadja said the private bank'€™s credit growth next year would be in line with industry estimates. '€œNational annual credit growth has been above 20 percent, but next year, the estimated increase is around 15 percent to 16 percent,'€ he said.

He further said that credit growth was expected to weaken next year although the macroeconomic shocks, including inflation, had occurred this year. His prediction was based on experience in the 2008-2009 crisis that was triggered by the US subprime mortgage loans.

'€œWhen the crisis hit in 2008, credit growth remained high. The credit growth slowdown was only felt the year after,'€ he noted.

He added that credit growth would weaken next year due to two factors '€” the waning performance of corporates, which in turn, affected their ability to take out loans, and market liquidity.

'€œWhen taking into consideration the four big banks, the average loan-to-deposit [LDR] ratio in August was 89.9 percent. However, when those four banks are taken out of the equation, the LDR is above 93 percent to 94 percent,'€ he said.

'€œThis situation means the remaining banks'€™ funds are just sufficient to fund existing loans, but expanding credit would be difficult unless they decide to offer higher interest rates,'€ he added.

He went on that the LDR of BCA was among the lowest at 74 percent. '€œThis means we still have secondary reserves, such as our deposit facility rate [FASBI] at Bank Indonesia, worth around Rp 62 trillion as of September,'€ he said.

He added the bank sought to maintain its LDR at 76 percent to 78 percent.

In the first nine months of the year, BCA recorded a year-on-year net profit increase of 25.2 percent to Rp 10.4 trillion. Net interest income rose by 24.7 percent to Rp 19.1 trillion on the back of higher lending. From January to September, its outstanding loans jumped 25.8 percent to Rp 298.93 trillion.

Its net interest margin went up by 62 basis points year-on-year to 6 percent. In addition, gross non-performing loans (NPL) were at 0.5 percent and their capital adequacy ratio (CAR) as of September was at 15.8 percent. As of September, year-on-year credit growth across all segments was at 25.8 percent to Rp 299 trillion.

Private lender Bank Permata reported its total loans grew 30 percent year-on-year to Rp 116.7 trillion, on robust business in small and medium enterprises, mortgage and middle market corporates.