Mandiri after tax profit may grow 300%

Following BNI's statement early this week that its profit after tax for 2006 grew 35% on loan growth of 6%, today, Bank Mandiri, the largest bank by assets, announced a possible 300% growth in profit after tax to Rp2.4 trillion for the financial year 2006. It's sad that the bank's credit grew only 9.1% last year while net interest margin (NIM) surged almost 20%.

It's a good news for investors, especially those who hold Mandiri shares (price of Rp1.640 in Dec 05 - Rp2.900 as of Dec 06, outperformed index with 77% gain).
Mandiri managed to cut its non-performing loan through major restructuring on debtors like Raja Garuda Mas (USD589 million), Agro Pantes (Rp2.88 trillion), Sumber Mitra, payment from Kiani, Apac etc even though several parties criticize some of these deals.
Domba Mas plans to refinance its Rp1.5 trillion debt, Bosowa to be restructured (Rp1.66 trillion), etc. Altogether, Mandiri's net NPL has dropped significantly to around 7% as of Dec 06, leaving the bank with further efforts to push NPL below 5% by the end of 2007.
What's next? We hope the bank could play more important role in funding new job creation projects.

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