PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Years Ended December 31, 2005 and 2004 Expressed in millions of Rupiah, unless otherwise stated
93
29. SUBORDINATED LOANS continued
Bank Indonesia continued As stated in the letter from Bank Indonesia No. 6130iDPbS dated November 26, 2004 regarding the
settlement of the subordinated loan to BSM, Bank Indonesia agreed to the proposal from BSM to fully pay the subordinated loan amounting to Rp32,000 on November 30, 2008. For this purpose, BSM pledged
premises and equipment as collateral. The loan bears interest at the rate of 6 per annum and is to be repaid in quarterly installments.
The details of this facility as of December 31, 2005 and 2004 are as follows:
Bank Term
of Loan
2005 Amount
Rupiah 2004
Amount Rupiah
Interest Rate
PT Bank Mandiri
Persero Tbk.
November 30, 2004 - March 31, 2014 with 1
st
installment on November 30, 2004.
2,441,859 2,466,859 0.2
per annum
PT Bank Syariah
Mandiri BSM
January 31, 1994 - November 30, 2008
with payment at maturity
date 32,000
32,000 Paid quarterly at 6 per annum
2,473,859 2,498,859
Others Subordinated Loans - Others are comprised of:
2005 2004
a Subordinated Undated Floating Rate Notes SURFNs
- 2,307,902
b Subordinated Notes
SNs 1,221,855
1,153,124 1,221,855
3,461,026
a Subordinated Undated Floating Rate Notes SUFRNs
Details of SUFRNs are as follows:
2005 2004
Term of Original Amount
Equivalent Original Amount
Equivalent Issuer
Subscriber Subscription
full amount Rupiah
full amount Rupiah
Bank Exim Puri International
July 27, 1990 - Limited
July 27, 2005 -
- US125,000,000
1,160,625 Bapindo
Mitra Sejati Dec 21, 1990 -
International Dec 21, 2005
- -
US125,000,000 1,160,625
- -
US250,000,000 2,321,250
Less: Unamortized discount -
- US1,437,664
13,348 -
- US248,562,336 2,307,902
PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Years Ended December 31, 2005 and 2004 Expressed in millions of Rupiah, unless otherwise stated
94
29. SUBORDINATED LOANS continued
Others continued Bank Exim SUFRNs
Under a Subscription Agreement dated July 24, 1990 and Trust Deed dated July 27, 1990, Bank Exim issued SUFRNs with an aggregate nominal value of US125,000,000 full amount through its Cayman
Islandss Branch to Puri International Limited. PIL, a special purpose vehicle incorporated in the Cayman Islandss, in exchange for cash of US90,255,000 full amount.
The aggregate nominal value of the Bank Exim SUFRNs of US125,000,000 full amount and accrued interest thereon is recognized as a liability as of December 31, 2005 and 2004 because Bank Mandiri
assumed all of Bank Exim’s assets and liabilities from the date of the merger Note 1b. The Bank Exim SUFRNs are perpetual as they have no stated maturity date.
Interest on the Bank Exim SUFRNs is calculated based on their aggregate nominal value at 1.1 per annum above the six-month LIBOR interest rate through July 27, 2005, and following that date, interest
is calculated based on their aggregate nominal value at 0.0001 per annum. While the Bank Exim SUFRNs remain outstanding, accrued interest is due and payable semi-annually in arrears at the end
of each interest period in July and January.
To fund its purchase of the Bank Exim SUFRNs, in July 1990 PIL entered into a Purchase Agreement and a Deferred Sale Agreement with investors represented by Japan Leasing Hong Kong Ltd. now
represented by STB Leasing Co., Ltd. under which PIL sold and repurchased certain property on deferred payment terms, proceeds from which were used to fund the purchase of the Bank Exim
SUFRNs amounting to US90,255,000 full amount and to make a deposit the “Deposit” of US34,745,000 full amount with BNP Paribas formerly Banque Nationale de Paris BNP. The terms
of the Deposit are set out in a deposit agreement dated July 24, 1990 the “Deposit Agreement”. The Deposit Agreement provides that on maturity of the Deposit in July 2005, BNP will repay PIL
US125,000,000 full amount comprising the original US34,745,000 full amount plus accrued interest of US90,255,000 full amount. The Deposit formed the collateral for the repurchase of the
property by PIL under the Deferred Sale Agreement.
In September 1998, PIL entered into a Sale Agreement with ING Bank N.V., Tokyo Branch “ING” under which PIL sold US13,000,000 full amount of Bank Exim SUFRNs to ING, and additionally and
together with Bank Exim and Japan Leasing Hong Kong Ltd., agreements were amended to transfer US3,613,480 full amount of the Deposit that was placed on deposit in BNP to the account of ING
with BNP the “ING Deposit”. ING granted Bank Exim a first priority pledge over the ING Deposit.
The terms and conditions of the Bank Exim SUFRNs provide for redemption of their aggregate nominal value upon the occurrence of several events including mandatory redemption if the Republic of
Indonesia ceases to beneficially own at least 51 of the issued voting capital of Bank Mandiri.
If Bank Mandiri was required to redeem the Bank Exim SUFRNs prior to the interest payment date falling in July 2005 and made repayment in full then, subject to the prior discharge by PIL of its
obligations under the Purchase Agreement, the Deferred Sale Agreement and other related agreements to STB Leasing Co., Ltd. and the investors who hold a first priority interest in the Deposit,
the Bank would become entitled to the Deposit pursuant to a Second Deposit Pledge Agreement dated July 24, 1990.
PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Years Ended December 31, 2005 and 2004 Expressed in millions of Rupiah, unless otherwise stated
95
29. SUBORDINATED LOANS continued
