Danamon's Q1 lending up 23% with $11.6B
Bank Danamon fueled a 23 percent year-on-year growth in loans for Indonesia’s in the first quarter of 2012.
The bank aggresively took funded purchases of automobiles, motorcycles and durable goods as well as financed operations of small and medium enterprises.
The increase in outstanding loans, which reached Rp 106 trillion or US$11.6 billion by end of March, lifted Bank Danamon’s net profit by 18 percent to Rp 900 billion in the first three months of the year compared with the same period last year.
Net interest income derived from Bank Danamon’s lending business also rose 5 percent to Rp 3.02 trillion.
Loans for cars and motorcycles, which are important indicators of Indonesia’s household consumption to drive the nation’s economic growth, are Bank Danamon’s forte through its subsidiary PT Adira Dinamika Multi Finance Tbk.
“Our automotive loans, both for two-wheelers and four-wheelers, disbursed through Adira Finance grew by 30 percent” in the first quarter this year from a year earlier, said Bank Danamon finance director Vera Eve Lim.
Vera attributed the rise in loans to the stable growth of and lower interest rates for the automotive industry, as banking regulator Bank Indonesia has maintained a low interest rate environment by cutting benchmark borrowing costs by a total of 100 basis points since a year ago to a record low of 5.75 percent.
Bank Danamon’s automotive loans and its micro-lending account for two-thirds of the bank’s loan portfolio, and that has attracted Southeast Asia’s largest lender DBS Group Holdings Ltd to takeover a 99 percent stake in Danamon in a $7.2 billion deal, the largest ever made by a regional bank.
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