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Bank Mandiri posts 9.2% growth in net profit in 2014
State-owned lender Bank Mandiri managed to increase its net profit by 9
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tate-owned lender Bank Mandiri managed to increase its net profit by 9.2 percent last year amid weakening loan growth in the country's banking industry due to global and domestic economic pressures.
The publicly listed bank posted Rp 19.9 trillion (US$1.54 billion) in consolidated net profit between January and December last year, increasing from Rp 18.2 trillion in the same period of 2013, its executive said.
Bank Mandiri finance director Pahala Mansury said the lender's five subsidiaries contributed Rp 500 billion to the Rp 19.9 trillion consolidated net profit.
Bank Mandiri's five subsidiaries are Bank Syariah Mandiri (BSM), life insurer AXA Mandiri Financial Services, multi-financing firm Mandiri Tunas Finance, securities company Mandiri Sekuritas and Bank Sinar Harapan Bali.
'So, the bank's net profit was Rp 19.4 trillion last year, which grew 12 percent from 2013,' Pahala said at a press conference on the lender's full-year report on Wednesday.
Pahala said Bank Mandiri's net profit growth was higher than the consolidated one because the latter was pulled down by a decline in BSM contribution, which saw Rp 49 trillion in financing last year from Rp 50.4 trillion in 2013.
'BSM's business size is big, so a decrease in BSM financing has affected its net profit, which in turn also affected our consolidated net profit,' he said.
Pahala added Bank Mandiri's net non-performing loans (NPLs) stood at 0.81 percent last year, from 0.23 percent in 2013, showing that economic pressures have slightly affected the quality of credit.
Bank Mandiri president director Budi Gunadi Sadikin said the lender's net profit growth was mainly driven by its loans, which increased by 12.2 percent to Rp 530 trillion last year, from Rp 472.4 trillion in 2013.
Budi said 13.9 percent of the bank's lending went to the productive sector, comprising investment and working capital loans, both of which grew 9.1 percent and 16.7 percent, respectively, last year.
'In the productive sector, loans to the infrastructure sector, including construction, increased by 19.1 percent, followed by 15.5 percent,' he said.
In terms of growth, Budi said micro loans had seen the biggest hike last year, which reached 33.2 percent to Rp 36 trillion from 2013. Bank Mandiri served a total of 119,000 micro customers as of last year, he added.
The bank's net profit growth was also prompted by operating income, which grew 11.7 percent to Rp 56.9 trillion, Budi said.
According to Budi, the lender's operating income comes from net interest income and net premiums, which grew 14.8 percent to Rp 41.8 trillion, as well as fee-based income of Rp 15.1 trillion, which increased by 3.9 percent.
Bank Mandiri also booked Rp 636.4 trillion in third-party funding (DPK) last year, up by 14.39 percent from Rp 556.3 trillion in 2013.
Budi said the growth of DPK was mainly contributed by savings accounts, which increased by 6.72 percent to Rp 252.4 trillion.
The higher increase of DPK compared to the loan growth made the bank's loan-to-deposit ratio (LDR) decline to 82.86 percent last year from 84.46 percent in 2013.
'Bank Mandiri has also added 262 new office branches taking it to a total of 2,132. The lender also added 3,830 ATMs making it 15,344. They will support the growth of our DPK,' he said.
