PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Year Ended December 31, 2006 With Comparative Figures For 2005
Expressed in millions of Rupiah, unless otherwise stated
11
1. GENERAL
a. Establishment PT Bank Mandiri Persero Tbk. hereinafter referred to as “Bank Mandiri” or the “Bank” was
established in the Republic of Indonesia on October 2, 1998 under Government Regulation No. 75 of 1998 dated October 1, 1998 and based on notarial deed No. 10 of Sutjipto, S.H. dated
October 2, 1998. The deed of establishment was approved by the Minister of Justice in decision letter No. C2-16561.HT.01.01.TH.98 dated October 2, 1998 and was published in Supplement No. 6859 of
State Gazette No. 97 dated December 4, 1998. Bank Mandiri was established through the merger of the former PT Bank Bumi Daya Persero BBD, former PT Bank Dagang Negara Persero BDN,
former PT Bank Ekspor Impor Indonesia Persero Bank Exim and former PT Bank Pembangunan Indonesia Persero Bapindo hereinafter collectively referred to as the “Merged Banks”.
Based on Article 3 of the Bank’s Articles of Association, Bank Mandiri is engaged in banking activities in accordance with prevailing laws and regulations. The Bank commenced operations on August 1,
1999. Bank Mandiri’s Articles of Association have been amended several times. The amendment is in respect
of the exercise of stock options under the Management Stock Option Plan MSOP program based on the number of share options executed.
During the year January 1, 2006 through December 31, 2006 and year 2005 the stock options exercised totaled 375,500,103 and 122,862,492 shares Note 32. The stock options exercised during
2006 and 2005 resulted in the increase of the issued and fully paid-up capital by Rp187,750 and Rp61,431, respectively and additional paid in capitalagio of Rp427,693 and Rp38,359 respectively.
The increase in additional paid in capitalagio represents the difference between the exercise price and market values of MSOP shares with the nominal value of Rp500 per share. The amendment of the
Bank’s Articles of Association related to the change in the capital structure is still in process.
b. Merger At the end of February 1998, the Government announced its plan to restructure the Merged Banks.
In connection with such restructuring plan, the Government established Bank Mandiri in October 1998 through the payment of cash and the acquisition of the Government of the Republic of Indonesia’s
shares of stock in the Merged Banks Notes 31a and 31b. Due to the impracticability of measurement, the difference between the transfer price and the book value of the shares of stock at the time of the
acquisition was not determined. All losses incurred during the year of acquisition were taken into account in the Recapitalization Program.
The above mentioned restructuring plan provided for the merger of the Merged Banks into Bank Mandiri in July 1999 and the recapitalization of Bank Mandiri. The restructuring of the Merged Banks
and Bank Mandiri also covered the following:
• Restructuring of loans. • Restructuring of non-loan assets.
• Rationalization of domestic and overseas offices. • Rationalization of human resources.
PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Year Ended December 31, 2006 With Comparative Figures For 2005
Expressed in millions of Rupiah, unless otherwise stated
12
1. GENERAL continued
