MANAGEMENT STOCK OPTION PLAN

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 107

35. INTEREST EXPENSE

Interest expense was incurred on the following: 2005 2004 Time deposits 7,161,132 5,147,235 Savings deposits 2,033,438 2,112,420 Demand deposits 1,252,277 1,131,117 Fund borrowings 427,613 349,484 Securities issued 413,203 362,396 Subordinated loans 84,006 310,138 Loan capital 56,863 35,309 Others 318,828 74,434 11,747,360 9,522,533 Included in interest expense from time and savings deposits is syariah expense for the years ended December 31, 2005 and 2004 amounting to Rp357,518 and Rp242,675, respectively.

36. OTHER OPERATING INCOME - OTHERS

2005 2004 Accretion in the realizable value of the security and effective reduction of principal related to SUFRNs Notes 15, 29 and 30 337,431 144,830 Others 334,031 557,487 671,462 702,317 37. PROVISION REVERSAL OF ALLOWANCE FOR POSSIBLE LOSSES ON EARNING ASSETS 2005 2004 Provisionreversal of allowance for possible losses on: Current accounts with other banks Note 4e 1,278 2,112 Placements with other banks Note 5e 63,043 19,428 Securities Note 6g 59,310 45,622 Other receivables - trade transactions Note 8d 192,897 26,008 Securities purchased with agreements to resell Note 9b 4,800 4,800 Derivative receivables Note 10 559 7,462 Loans Note 11B.j 3,860,646 276,305 Acceptances receivable Note 12d 277,140 6,626 Investments in shares of stock Note 13c 4,847 1,922 4,445,226 371,517 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 108

38. REVERSAL OF ALLOWANCE FOR POSSIBLE LOSSES - OTHERS

2005 2004 Reversal of allowance for: Possible losses on legal cases Note 28 297,241 259,172 Possible losses on fraud cases 3,078 50,000 Others 756,326 - 1,056,645 309,172

39. LOSSESGAINS FROM DECREASEINCREASE IN VALUE OF SECURITIES AND GOVERNMENT RECAPITALIZATION BONDS

2005 2004 Securities 22,812 71 Government Recapitalization Bonds 66,332 66,201 89,144 66,272 40. GAINS FROM SALE OF SECURITIES AND GOVERNMENT RECAPITALIZATION BONDS 2005 2004 Securities 199,204 218,892 Government Recapitalization Bonds 257,290 1,365,343 456,494 1,584,235

41. GENERAL AND ADMINISTRATIVE EXPENSES

2005 2004 Depreciation and amortization of premises and equipments 557,706 533,559 Rent 446,310 346,168 Repairs and maintenance 283,153 313,723 Communications 281,917 301,263 Professional fees 277,075 256,084 Promotions 270,812 321,910 Electricity, water and gas 198,716 153,664 Public relations 137,998 198,343 Transportations 133,385 51,671 Office supplies 113,930 117,450 Office equipments 41,059 20,889 Research and development 6,480 8,469 Others 331,538 365,479 3,080,079 2,988,672 Professional fees included audit and tax services amounting to Rp23,703 and Rp21,227 for the years ended Decenber 31, 2005 and 2004, respectively.