Oct. 27 (Bloomberg) -- PT Bank Negara Indonesia, the nation’s third-biggest state-owned bank by market value, said nine-month net income rose 37 percent, supported by increased loan growth.
Net income for the January through September period jumped to 4.06 trillion rupiah ($457 million), from 2.95 trillion rupiah in the same period last year, the lender said in a statement released in Jakarta today. Outstanding loans grew 27 percent to 160.72 trillion rupiah, exceeding the average growth in loans for Indonesian commercial banks, President Director Gatot Suwondo said at a press briefing.
Bank Indonesia cut its benchmark interest rate by a quarter percentage point to 6.5 percent for the first time in more than two years Oct. 11, help to boost purchasing power in Southeast Asia’s biggest economy. Sluggish growth in the world’s developed economies is threatening to slow the pace of expansion in Asia’s emerging markets.
Net interest income, or interest earned on loans after deducting interest paid for deposits, rose 5 percent to 9.41 trillion rupiah, the bank said. Provision for bad loans fell 13 percent to 2.49 trillion rupiah, the lender said.
Loans from Indonesian commercial banks rose 23.8 percent in September from a year earlier, the central bank said on Oct. 11. Bank Indonesia forecasts credit growth at Indonesian banks will rise 25 percent in 2011, beating the industry’s 24 percent target, as demand for working capital and investment-credit increases, Deputy Governor Muliaman Hadad said on Sept. 24.
--Editors: Andrew Janes, Greg Ahlstrand
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