Indonesia's Bank Mandiri 2015 Profit Rises 2%, Beats Estimates

23 February 2016 Indonesia's biggest bank by assets, Bank Mandiri, reported a better-than-expected net profit for 2015 on Tuesday, but its bad loans crept up partly due to its exposure to the commodities sector.

The state-controlled lender posted a net profit of Rp 20.3 trillion ($1.5 billion) for the year ended December, about 2 percent higher than 2014. Total loans jumped 12.4 percent to 595.5 trillion rupiah. Growth in net profit was the smallest in a decade, according to Thomson Reuters data, as the bank stepped up provisions. But the lender's 2015 profit still came above the average forecast of 19.59 trillion rupiah from 18 analysts.

Gross non-performing loans (NPL) rose to 2.6 percent of total loans by the end of 2015, from 2.15 percent in the previous year. That was the highest percentage level since 2009, Thomson Reuters data shows.

Gross NPL is seen at 2.5 percent to 3 percent in 2016, Mandiri Chief Financial Officer Kartika Wirjoatmodjo told reporters.
Mandiri is avoiding exposure to the oil and gas and mining sectors as the slowdown in China's economy has reduced the demand for commodities, said Ahmad Siddik Badruddin, director of risk management and compliance.

Mandiri shares fell 1.6 percent, underperforming the broader Jakarta stock exchange, ahead of its earnings.