OTHER RECEIVABLES - TRADE TRANSACTIONS continued

PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Years Ended December 31, 2008 and 2007 Expressed in millions of Rupiah, unless otherwise stated 51

10. DERIVATIVE RECEIVABLES AND PAYABLES continued

Interest Rate Swaps On April 17, 2003 Bank Mandiri entered into interest rate swap agreements with counterparty banks with nominal values amounting to US125,000,000 full amount and US175,000,000 full amount, respectively. The underlying transaction is the Bank’s US300,000,000 full amount fixed interest rate Medium-Term Notes MTN issued in April 2003 Note 24. Under this transaction, the Bank receives semi-annual fixed interest at the rate of 7.00 per annum and pays semi-annual floating interest at the rate of six-month LIBOR + 3.37 per annum until the maturity of the Note on April 22, 2008. The six-month LIBOR interest is stated in arrears. These transactions qualify as hedging for accounting purposes. The background and purpose of the issuance of the hedging instruments are related to interest rate risk management, whereby the Bank’s positive foreign currency interest rate gap position is exposed to downward trends in interest rates in the following five years. The Bank decided to convert its MTN’s fixed interest rate into floating interest rates in order to mitigate the risks of a decreased in net interest margin. The MTN has been settled on April 22, 2008. Cross Currency Swap Bank Mandiri has entered into cross currency swap contracts, which are associated with the securities sold with agreements to repurchase with several counterparty banks. The contracts were initiated when Bank Mandiri sold its Government Bonds to the counterparty banks and received Rupiah funds. These funds were used to settle the spot leg of the cross currency swaps and Bank Mandiri will then receive US Dollar funds. On the settlement date, the Bank will receive Rupiah funds and pay US Dollar funds to the counterparty banks. Bank Mandiri is then obliged to use the Rupiah funds to repurchase the Government Bonds previously sold to counterparty banks Notes 7 and 22. A summary of the cross currency swap contracts is as follows: Type of Buy Sell Effective Date Maturity Date Transactions full amount full amount November 3, 2004 November 3, 2009 Spot US25 million Rp285,060 million Forward Rp285,060 million US25 million November 4, 2004 November 4, 2009 Spot US25 million Rp284,062 million Forward Rp284,062 million US25 million May 18, 2005 May 18, 2010 Spot US25 million Rp316,356 million Forward Rp316,356 million US25 million