Operating costs pulls down Citibank Indonesia's profit

Citibank Indonesia saw its profits from January to September go down by 27 percent.

The bank's net income fell to Rp 1 trillion or $110 million from Rp 1.38 trillion in the same period in 2010, while operational costs rose 65 percent to Rp 1.63 trillion.

Net interest income fell 6.7 percent to Rp 2.23 trillion.

Mona Monika, the bank’s assistant vice president for corporate affairs, said the rise in operating costs was partly the result of the bank hiring 1,400 debt collection staff members in the past several months.

With Rp 62 trillion in assets across Indonesia, Citibank has 19 branch offices in six major cities.

Other foreign banks operating in Indonesia, however, booked strong earnings during the nine-month period, thanks to robust domestic demand.

Bank DBS Indonesia, the local unit of Singapore’s biggest bank, DBS Group, posted a 319 percent year-on-year profit increase to Rp 334.6 billion in the January-September period.

British lender Standard Chartered Bank, higher net interest income helped boost earnings by 364 percent. The bank reported net income of Rp 287.21 billion, compared to Rp 61.77 billion in the same period a year earlier. Net interest income was up 54 percent to Rp 1.4 trillion.

The bank’s operating profits also rose 63 percent to Rp 997.3 billion, and it booked a smaller loss from spot-market transactions and derivatives.

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