RELATED PARTY TRANSACTIONS continued

PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS June 30, 2004 and 2003, and April 30, 2003 Expressed in millions of Rupiah, unless otherwise stated 153

59. RELATED PARTY TRANSACTIONS continued

a. Banking Activities in the Ordinary Course of Business continued Percentages of current accounts, savings accounts, time deposits and liabilities to the Government arising from the return of additional paid-in capital compared to the total consolidated liabilities are as follows: June 30, 2004 June 30, 2003 April 30, 2003 Demand Deposits 0.04 0.01 0.01 Savings Deposits 0.01 - - Time Deposits 0.14 0.68 0.74 0.19 0.69 0.75 b. Significant transactions with the Government of the Republic of Indonesia • In May 1999, the Government implemented a recapitalization program for Bank Mandiri by issuing Government recapitalization bonds Notes 3 and 9. • In connection with the recapitalization, Bank Mandiri entered into a management contract with the Government in April 2000 Note 60a. • The Committee on Financial Sector Policy KKSK and the Minister of Finance approved and guaranteed the issuance of standby letters of credit and conversion of loans of PT Garuda Indonesia to Mandatory Convertible Bonds. • The Bank paid Rp1,124,194 to the State Treasury representing a 50 deposit in relation to an objection regarding the Bank’s 2000 corporate income tax assessment Note 17. • The Bank returned additional paid-in capital of Rp1,412,000 representing a portion of the excess recapitalization Note 34. • Based on the Minister of Finance’s Decision Letter No.227KMK.022003 dated May 23, 2003, and Decree of the Minister of State-Owned Enterprises, as the Bank’s shareholder, No. KEP-154M-MBU2002 dated October 29, 2002, the Government converted recapitalization fund amounting to Rp5,000,000 with 5,000,000 shares with nominal value of Rp1,000,000 full amount per share, and the remaining recapitalization fund amounting to Rp168,801,315 was recorded as Agio. • Based on Government Regulation PP No. 26 dated May 29, 2003, the Government of the Republic of Indonesia converted Rp1,000,000 of appropriated retained earnings to issued and fully paid-up capital. PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS June 30, 2004 and 2003, and April 30, 2003 Expressed in millions of Rupiah, unless otherwise stated 154

60. SIGNIFICANT AGREEMENTS, COMMITMENTS AND CONTINGENCIES