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
104
32. SHAREHOLDERS’ EQUITY continued
d. Distribution of Net Profit Based on the resolution of the shareholders during their general meetings held on May 16, 2005 and
May 5, 2004, the shareholders approved the distribution of the 2004 and 2003 net profit as follows:
2004 2003
Dividends 2,627,816
2,300,000 Tantiem
26,278 22,930
Cooperative Development fund program 78,835
- Community Development fund program
26,278 -
2,759,207 2,322,930 Appropriated retained earnings: General reserve
1,813,285 200,000
Specific reserve -
547,000 Total
1,813,285 747,000
Retained earnings 683,139
158,644 5,255,631 3,228,574
Dividend per share Rp130.496 full amount Rp115.00 full amount
In accordance with the Extraordinary General Shareholders’ Meeting held on December 21, 2005, tantiem is taken from 2004 net profit, which have been approved as retained earnings based on the General Shareholders’ Meeting’s decision on May 16, 2005
The dividends from 2004 net profit were paid to the shareholders on June 24, 2005. The dividends and directors’ and tantiem from the 2003 net profit were paid to the shareholders and directors and
commissioners of the Bank on June 7, 2004 and June 30, 2004, respectively. The allocations for Cooperative development fund program and the community development fund program were paid on
June 21, 2005. Up to 2003, the Bank charged tantiem to retained earnings. In accordance with PSAK No.24 Revised
2004 regarding employee benefits, the Bank has accrued the tantiem in the 2004 financial statements. At the General Stockholders’ Meeting on May 16, 2005, the shareholders agreed the payment of
tantiem to the members of the Board of Directors and Commissioners and Commissioners’ Secretary in the amount of Rp26,278.
Tantiem amounting to Rp26,278 from the 2004 profit which was previously charged against the accrual provided in 2004, based on the decision at the Extraordinary General Shareholders’ Meeting is charged
against the 2004 retained earnings and the accrual previously provided is reversed as part of the 2005 operational profit.
The change is made to fulfill the legal requirement as stated in Explanation of Article 62 1 UU No. 1 Year 1995 regarding Limited Company “UU PT”, which states that tantiem be taken from net profit.
e. Difference Arising from Transactions Resulting in Changes in the Equity of Subsidiaries The account represents the Bank’s proportionate interest in the subsidiaries arising from changes in
subsidiaries’ equity which are not derived from transactions with the Bank and are calculated based on the percentage of ownership of the Bank and subsidiaries. In 2005, the Bank adjusted the unrealized
loss from available for sale securities as part of Difference Arising from Transactions Resulting in Changes in the Equity of Subsidiaries because of the related securities held by Subsidiaries.
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
105
33. MANAGEMENT STOCK OPTION PLAN
Based on the Extraordinary General Shareholders’ Meeting held on May 29, 2003, which was notarized on the same date by Sutjipto, S.H., as per notarial deed No. 142, the shareholders approved the adoption
of the Management Stock Option Plan MSOP.
The purpose of the MSOP program is to achieve long-term objective, of ensuring the continuity of the current or future performance of the Bank by aligning management and shareholders’ objectives. The
Bank implemented a MSOP program to attract, retain and motivate senior management and other key employees. The bank plans to issue MSOP shares, additional common shares Series B issued without
the priority right to order share, up to maximum 5 from the total of Issued and fully paid-up capital or equal to 1 billion of common shares Series B with par value of Rp500 full amount per share.
The options granted at Stage-1 MSOP - Stage 1 which were approved during the Extraordinary General Shareholders’ Meeting held on May 29, 2003, involved 2.18 of the total paid-up capital, with an
exercise price of 110 of the offering price or equivalent to Rp742.5 full amount per share, and with a vesting period of two years.
The share option life is five years from the grant date. The number of stock options that can be exercised for MSOP - Stage 1 at the end of the first year from the grant date is a maximum of 50 of the total
options granted, and the remaining 50 may be exercised at the end of the second year up through the end of the fifth year.
On July 14, 2003, the date of the Bank’s IPO, the Bank granted MSOP - Stage 1 amonting to 378,583,785 share options with an exercise price of Rp742.5 full amount per share or 110 of the
offering price. The fair value of MSOP – Stage 2 stock options granted as of July 14, 2003 was Rp69.71 full amount
based on a valuation report issued by PT Watson Wyatt Indonesia dated March 4, 2004. The General Shareholders’ Meeting held on May 16, 2005 approved the MSOP – Stage 2 amounting to
312,000,000 share options. Exercise price and nominal value for each share is Rp1,190.5 full amount and Rp500 full amount, respectively.
MSOP – Stage 2 share option life is five years from the grant date. All stock options can be exercised since February 7, 2006 which is determined as vested date. The exercise of the share options is in
accordance with Jakarta Stock Exchange regulation that the window for exercise is only two times a year. The exercise period is in accordance with the window trading regulation which is 2 two working days
after the issuance of a quarterly published financial report and is closed at 30 thirty days working days after or when there is non material non public information or Corporate Action, which ever comes first.
The fair value of MSOP – Stage 2 stock options granted as of May 16, 2005 was Rp642.28 full amount based on a valuation report issued by PT Watson Wyatt Indonesia dated February 27, 2006.
