08 02 15 BMRI Analyst Meeting
PT Bank Mandiri (Persero) Tbk
2008 Analyst Day
15 February 2008
Fulfilling all financial milestones#...
Gross NPL below 10%
Net NPL below 4%
Increased coverage of NPLs to > 100%
Profitability normalizing, ROE > 15%
Gross loan growth > 18%*
Major leap in savings deposits to > Rp65 tn
Growing balance sheet to more than Rp300 tn
Margin improvement to approximately 5%
Retain efficiency ratio below 50%
;
;
;
;
;
;
;
;
;
# All data reported in this presentation are based on in-house unaudited numbers
* Prior to the write-off & repayment of NPLs
1
preparing for the 2nd stage of transformation
~12 months
Horizon 1:
Fix the leaks and lay foundations
“Back on Track”
Build winning
organization &
performance
culture
Deliver tailored
proposition for
priority
segments
New BU structure and Performance
Management System in place to drive
performance culture
Higher professional standards
embedded
Piloted and implementing CST model
for large corporates
New commercial business model in
place for medium and small
commercial
Revamp alliance
program
Strengthen risk
management &
operations
Overall Bank
Source: Team Analysis
“Bad Bank” up and running to resolve
NPL issues
Key operational improvements wellunderway
C/I ratio of ~76% with ~15% market
share
~12-24 months
Horizon 2:
Consolidate & build momentum
“Outperform the Market”
~12-24 months
Horizon 3:
Accelerate and grow
“Shaping the End Game”
Among most desired employers in
Indonesia due to best people
development program
Dominant corporate bank built on CST
model
Top commercial players with strong
penetration in target segments
Completed acquisition of specialized
bank and multifinance company
Market-leading position for affluent and
lower affluent banking
Most convenient and service-oriented
retail bank
Completed acquisition and
integration of major domestic bank
Top 3 alliance program up and running,
creating synergies across segments
Alliance program up and running,
creating synergies across segments
NPLs down to 5% gross
NPLs fully resolved and Bad Bank
dissolved
C/I ratio of ~59% with
~16-17% market share
C/I ratio of ~54-55% with ~20-30%
market share
P/B ratio 2.2
Exploring regional expansion
2
Specific initiatives to outperform the market..
Build
momentum for Growth
Non-organic Growth
Corporate
Commercial
Treasury & Int’l
Micro & Retail
Consumer Finance
• Extending the implementation of our performance culture by implementing value-based management,
including reviewing capital allocation across business units
• Improving operational efficiency through centralization, renegotiating contracts and reallocating
resources to more cost efficient channels
• Enhancing productivity of our staff through implementing best practice HR management and building
capabilities
• Building the necessary infrastructure to support growth targets, including in risk management
• Building brand experience and brand visibility
3
Building momentum for growth (1)
Q4 2006*
Q4 2007*
Change
Total Assets
Rp267.5 tn
Rp320.7 tn
19.9%
Total Deposits
Rp205.7 tn
Rp247.5 tn
20.3%
Low Cost Deposits
Rp109.1 tn
Rp152.4 tn
39.7%
• Current Accounts
Rp 48.8 tn
Rp 66.9 tn
37.2%
• Savings Accounts
Rp 60.3 tn
Rp 85.4 tn
41.7%
Total Loans
Rp117.7 tn
Rp138.3 tn
17.5%
*Consolidated
4
Building momentum for growth (2)
Loans by SBU*
(Rp Bn)
Corp
Small
Comm
Micro
Cons
70
1.7
7.6
60
10.7
50
40
2.7
42.1%
13.1
47.2%
1.9
8.9
11.1
14.2
Rp Savings Deposits
Rp Demand Deposits
FX Demand Deposits
Rp Time Deposits
FX Time Deposits
200
90
80
2007
U
250
110
100
Deposits by Product – Bank Only
(Rp Bn)
27.9%
15.7
150
31.5
29.1%
24.4
93.2
100
25.9
47.7
20
30.9
37.0
28.9%
80.5
13.2
14.9
30
12.6
2007
U
15.9
26.2%
73.4
(8.8%)
14.5
9.8%
50.4
50.0%
81.5
41.5%
33.6
30.1
50
45.2
10
57.6
0
0
Q4 '05
Q4 '06
Q4 '07
Q4 '05
Q4 '06
Q4 '07
*Cash Collateral Loans have been reallocated to Small Business
5
Continue to leverage cash generators (1)
Consumer
Finance &
Micro & Retail
Banking
Rp2,633 bn
33
Providing Services & Business Development for
Oil & Gas Company
Corporate &
Treasury
Building
Future
Growth
Engine
Performance
to Date
Mandiri Prioritas Membership
143 New
Customers
185 Customers
Liabilities Product & Investment
Product
IDR 75.1 bn
IDR 85.0 bn
Consumer
Cards
Corporate Card
1,600 cards
2,314 cards
Consumer
Loans
Mitrakarya Mandiri
IDR 150 bn
IDR 160 bn
Lending to Petrol Distributors
IDR 50 bn
IDR 8.6 bn
Lending to Petrol Sub-agents
IDR 50 bn
IDR 0.44 bn
Employees Cooperatives
IDR 39 bn
IDR 16.2 bn
IDR 37 bn
IDR 18.3 bn
Trade Service
USD 1.84 bn
USD 2.23 bn
EDC on SPBU
150 units
259 units
-
3,000 account
(IDR 29 bn)
USD 7.71 bn
USD 5.30 bn
IDR 3 tn
IDR 5.4 tn
Rp3,830 bn
Wealth
Management
11
Leveraging
Our Cash
Generator
Optimizing
Optimizing
Synergies
Synergies
Across
Across SBUs
SBUs
Strengthen
Emerging
Business
Targets
Groups
Facilities
Micro Business
22
Commercial
Banking
Rp2,063 bn
Small Business
Delivery Order SPBU
Commercial
Banking
Mass &
Electronic
Banking
Payroll
Foreign Exchange
Contribution Margin (Net Profit Before Tax)
Treasury
Money Market
6
Continue to leverage cash generators (2)
Supplier/ Employees
Value Chain
Facilities to sub-contractors
providing construction as well as
supplier requirements:
Cash Loans
Non Cash Loans
E-BIZ for Small Business
segment
Leveraging on the large number
of employees:
Payroll Package for payment
of salaries to employees
Consumer Loans for the
employees of the company, ex.
Mitra Karya
Telkom
Customers/Channels
Telkom &
Group
Optimize Funding and
Lending facilities through our
CST Program to increase share
of wallet by offering:
Cash Loans
Non Cash Loans
Cash Management Systems
Treasury products to better
manage currency exposure
from importing capital
goods
Trade products, particularly
for import of capital goods
End User
Leverage Telkom’s customer
base to cross-sell our several
products such as:
Co-branding or introducing
Credit Cards
Cross-sell consumer loan
products
Offer wealth products to
selected customers
Bill payment
In addition, we are also
looking for opportunities to
leverage Telkom’s outlets to
sell Bank Mandiri products
•Sizeable opportunities in generating business for other SBUs
•Deepening relationships with existing customer base
7
Strengthening the Mandiri Group…
Syariah Banking
Investment
Bank
Insurance
Niche Banking
Bank Sinar
Harapan Bali
Total Assets
Rp11.5 tn
Bond Trading Volume
Rp70.8 tn
Total Assets
Rp3.2 tn
Total Loans
Rp173 bn
Total Financing
Rp9.3 tn
Bond Underwriting
Rp3.5 tn
Annual FYP
Rp438 bn
Net Interest Margin
13.7%
Total Deposits
Rp9.9 tn
Equity Trading Volume
Rp49.4 tn
Total GWP
Rp1.4 tn
ROA
3.4%
ROE
16.6%
ROA
5.8%
Embedded Value
Rp466 bn
ROE
19.7%
• Remain the leader in
syariah financing
• Capital injection
program over 3 years
• Cross-sell syariah
products to Mandiri
customers
• Expansion of business to
fully utilize current capital
base
• Cross-sell capital market
services to broad range of
Mandiri customers
• Refocus business toward
higher fee income
• Provide end-to-end bank
assurance business
• Continue to build crosssell opportunities in
various segments
• Bank assurance products
complete our suite of
consumer offerings
• Enhance operating model
• Improve risk management
systems and IT
• Improve productivity
8
Niche Strategy - Bank Sinar Harapan Bali
Total Lending (Rp bn)
175
150
125
100
75
50
25
0
125.9
107.3
2004
2005
Our Strategy & Intent
133.6
2006
172.7
Oct '07
Total NPL (%)
3%
2%
2%
1%
1%
1.25%
0.82%
1.25%
0.70%
0%
2004
2005
2006
Oct '07
14.1%
13.5%
13.7%
2005
2006
Q3 '07
Net Interest Margins
18%
15%
12%
9%
6%
16.0%
Our main focus will be to
strengthen Bank Sinar’s capability
and infrastructure by assisting the
implementation of appropriate
Risk Management Tools, an IT
Platform, as well as Human
Capital Development
We intend to maintain Bank
Sinar’s positioning as the
premiere Micro & SME lending
institution in Bali, through the
introduction of new products
aimed specifically toward this
particular segment
Bank Mandiri will also utilize Bank
Sinar as a vehicle to further
develop and penetrate the Micro
& SME segment in Indonesia,
which is an integral part of Bank
Mandiri’s strategy to develop
high-margin segment
Actions Going Forward
EGM to approve the acquisition
of Bank Sinar is planned for
March 17th, 2008
Following the EGM, and upon
approval from BI (anticipated by
end of March 2008), we intend to
sign the Sale & Purchase
Agreement (SPA) for the
ownership of 80% of Bank Sinar
Before completing the
transaction, we have assigned
personnel to assist Bank Sinar in
preparing for post-acquisition
business development (with
specific focus on strengthening
Risk Management and IT
platform), product development,
and to ensure value preservation
of Bank Sinar during the interim
period
3%
0%
2004
9
Corporate Banking: Establishing Multi-faceted
Relationships
1. Strengthening relationships with existing customers where Bank
Mandiri has a dominant share, including plantations, infrastructure,
SOE’s and other government institutions.
2. Finding opportunities to cross-sell fee-based business through
treasury products, cash management and investment banking
activities.
3. Actively target publicly listed companies with which Bank Mandiri is
currently not garnering a sufficient share, particularly in attractive
sectors.
4. Improve our value proposition through more tailored product
offerings, total relationship management and fast turnaround to
targeted customers.
5. Broaden relationships to offer products and services to our
corporate clients’ suppliers, employees and customers.
10
Corporate Banking: Cross-selling and alliances to expand
our total value chain exposure
Relationships with 145 Top SOEs and Govt Depts
Further driving cross-selling opportunities into other SBU’s
e.g. Free Fuel program to increase utilization of EDCs in Pertamina gas stations
Share of Funding (%) of Top 100 Public Companies
Payroll Loan Growth from Alliance Program
800
100%
40.3%
80%
600
60%
100.0%
40%
400
41.2%
200
20%
11.0%
0%
7.5%
BM
319
391
486
532
Q2 '07
Q3 '07
611
0
Other SOEs Private JVs/Foreign Total
Banks
Q4 '06
Q1 '07
Q4 '07
11
Commercial Banking : Stronger Platform Improved
Distribution Capability
Movement of Commercial Loans
Strategies For 2008
Rp Tn
10.0
17.1
0.1
2. Targets growth in selected geographics
and regions including through take overs
and strengthening distribution
0.1
0.2
24.4
1. Focus on large and medium commercial
to grow quality loan portfolio
31.5
3. Financing the subcontractors of large
corporates particularly in infrastructure,
mining, and telecom
4. Grow the solid and stable source of low
cost funds
2007
Write-Offs
Intra SBU
Movement
FX Impact
Repayments
Disbursement
2006
5. Strengthening the infrastructure of fee
income business, particularly trade finance
and cash management
12
Commercial Banking : Stronger Platform Improved
Distribution Capability
Expanding Scope of Distribution, 2007
Sumatera
Loans = Rp 4.8 Tn
Funds = Rp 5.1 Tn
Java and Bali
Loans = Rp23.8 Tn
Funds = Rp22.2 Tn
Kalimantan
Loans = Rp2.1 Tn
Funds = Rp1.7 Tn
Eastern
Loans = Rp0.7 Tn
Funds = Rp1.4 Tn
Solid & Stable Source of
Low Cost Funds
Rp Tn
Product
2006
2007
Growth
Demand
Deposit
14.76
19.36
31.2%
Rupiah
11.43
15.24
33.3%
FX
3.33
4.11
23.4%
Saving
Deposit*
0.74
1.75
236.5%
Total Low
Cost Fund
14.76
21.11
43.0%
Total
Funding
23.28
30.52
31.1%
CBC = 17 Unit
Floor = 12 Unit
TSC = 9 Unit
Low Cost Fund Ratio = 69.17%
LDR Commercial = 102.95%
* Business Savings Product
13
Treasury & International Banking: Focused on FX and
trade transactions
Volume of Forex Transaction
(USD Bn)
72.5
Singapore Branch Loan Growth
(IDR Bn)
78.7
1,323
52.7
547
375
2005
2006
2007
2005
2006
2007
Strategies for 2008
1. Intensify cross-selling of forex
products and services to our
corporate and large
commercial clients
2. Leverage our overseas network
to grow our syndicated
facilities to high quality
customers in selected sectors
3. Partner with 3rd parties to
improve derivative offerings
4. Enhancing our regional
distribution (RTM) in high
growth, export-oriented
regions in collaboration with
Micro & Retail Banking
5. Seek opportunities to enhance
the yield of our recent
portfolio
14
Micro & Retail Banking : Rapidly growing our high
margin businesses
Breakdown of New Micro
Loans Disbursed
Breakdown of New Small Business
Loans Disbursed
Rp Bn
Rp Bn
2,460
97
31 101
7,118
1,591
289
0.015
2,058
2,549
1,478
Strategies for 2008
580
TOTAL
Cash Collateral Loans
Food Sufficiency Loans
Channeling Loans
Alliance
Cooperatives
Program Loans
Non-Program Loans
TOTAL
Unsecured Micro
Loans
Micro Loans
Rural Banks
1. Build around our strength
in corporate and large
Commercial customers to
quickly build high margin
business
2. Continue to improve our
payment infrastructure
3. Expand our distribution
with a focus on high
margin business
4. Improving sales culture and
productivity of existing
network
5. Cross sell to grow our fee
based income business
15
Micro & Retail Banking: Building upon our solid
infrastructure & extensive corporate relationships
Building on Our Corporate
Strength
Improving Our Payment
Infrastructure
Strengthening Our Distribution
Network
1. Growing micro-loans to
employees of and suppliers
related to our corporate
customers (e.g. loans to petrol
distributors, loan to employee
cooperatives, etc)
Informations
Mutual Funds
Transfer
Education
23,690
Payment/Purchase
Loan Installment
Credit Card
Tax Payment
BCA
30,000
EDCs
Cash Deposit
Insurance
2. Payment Systems for employee
payroll and payment points
3. Saving products and ATM
Services for employees at
corporate company area
Debit Facility
BNI
Micro
Outlets
597
297
Bank Mandiri
Recently Added Features
Insurance Payment
Installment Payment
Education Payment
Multi Payment
Acquiring/ATM Network
Purchase Payment
Credit Card Payment
Branches
& Outlets
1,025
955
4,186
ATM
3,186
Plan 2008
2007
16
Consumer finance: Cross-selling to corporate
employees and driving anchor mortgage products
Breakdown of Consumer Finance*
(Rp Bn)
5,382
3,865
4,501
3,663
Q3 '07
3,437
3,390
3,404
3,522
3,610
Q2 '07
3,010
2,427
3,666
Q1 '07
1,908
2,285
Q4 '06
2,789
1,358
2,644
1,293
1,426
121.4%
1,678
Other
Credit Cards
Payroll Loans
Home Equity Loans
Mortgages
2007
U
47.6%
Strategies in 2008
1. Building on our corporate relationships to
cross-sell our consumer finance products particularly cards and payroll loans
31.7%
2. Continue to focus on growing 3 main
products: mortgages, credit cards, and
payroll & personal loans
(6.2%)
3. Expand our channels through converting
the outlets into business centers and
opening new consumer outlets
4. Optimize the business process, and
continue to improve the existing score
cards
49.1%
5. Focus on top 10 developers and dealers as
main distributors
Q4 '07
*Cash Collateral Loans have been reallocated to Small Business
17
Consumer Finance: Expanding high margin products
& driving developer relationships
Grow High Margin Consumer Finance
Example of Our Push to Focus on Top 10
Developer
85% Share to Total
Housing Sales
18
...translated into specific milestones in 2008
Gross NPL < 5%
Improving return to shareholders, ROE > 19%
Gross loan growth > 22%*
Savings deposit growth to > Rp85 tn
Margin improvement to approximately 5.2%
Retain efficiency ratio below 50%
Increased coverage of NPLs to > 120%
*Prior to the write-off & repayment of NPLs
19
Notes
__________________________________________________________________________________
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__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
20
21
For Additional Information:
Please refer to our website at www.bankmandiri.co.id
Or Contact:
Mansyur Nasution
Corporate Secretary
Tel: (6221) 524 5299
Fax: (6221) 5296 4024
Jonathan Zax
Head of Investor Relations
Tel: (6221) 3002-3171
Fax: (6221) 5290 4249
E-mail: ir@bankmandiri.co.id
PT Bank Mandiri (Persero) Tbk
Plaza Mandiri
Jl. Jend. Gatot Subroto Kav. 36-38
Jakarta 12190
Main Tel: 526-5045
2008 Analyst Day
15 February 2008
Fulfilling all financial milestones#...
Gross NPL below 10%
Net NPL below 4%
Increased coverage of NPLs to > 100%
Profitability normalizing, ROE > 15%
Gross loan growth > 18%*
Major leap in savings deposits to > Rp65 tn
Growing balance sheet to more than Rp300 tn
Margin improvement to approximately 5%
Retain efficiency ratio below 50%
;
;
;
;
;
;
;
;
;
# All data reported in this presentation are based on in-house unaudited numbers
* Prior to the write-off & repayment of NPLs
1
preparing for the 2nd stage of transformation
~12 months
Horizon 1:
Fix the leaks and lay foundations
“Back on Track”
Build winning
organization &
performance
culture
Deliver tailored
proposition for
priority
segments
New BU structure and Performance
Management System in place to drive
performance culture
Higher professional standards
embedded
Piloted and implementing CST model
for large corporates
New commercial business model in
place for medium and small
commercial
Revamp alliance
program
Strengthen risk
management &
operations
Overall Bank
Source: Team Analysis
“Bad Bank” up and running to resolve
NPL issues
Key operational improvements wellunderway
C/I ratio of ~76% with ~15% market
share
~12-24 months
Horizon 2:
Consolidate & build momentum
“Outperform the Market”
~12-24 months
Horizon 3:
Accelerate and grow
“Shaping the End Game”
Among most desired employers in
Indonesia due to best people
development program
Dominant corporate bank built on CST
model
Top commercial players with strong
penetration in target segments
Completed acquisition of specialized
bank and multifinance company
Market-leading position for affluent and
lower affluent banking
Most convenient and service-oriented
retail bank
Completed acquisition and
integration of major domestic bank
Top 3 alliance program up and running,
creating synergies across segments
Alliance program up and running,
creating synergies across segments
NPLs down to 5% gross
NPLs fully resolved and Bad Bank
dissolved
C/I ratio of ~59% with
~16-17% market share
C/I ratio of ~54-55% with ~20-30%
market share
P/B ratio 2.2
Exploring regional expansion
2
Specific initiatives to outperform the market..
Build
momentum for Growth
Non-organic Growth
Corporate
Commercial
Treasury & Int’l
Micro & Retail
Consumer Finance
• Extending the implementation of our performance culture by implementing value-based management,
including reviewing capital allocation across business units
• Improving operational efficiency through centralization, renegotiating contracts and reallocating
resources to more cost efficient channels
• Enhancing productivity of our staff through implementing best practice HR management and building
capabilities
• Building the necessary infrastructure to support growth targets, including in risk management
• Building brand experience and brand visibility
3
Building momentum for growth (1)
Q4 2006*
Q4 2007*
Change
Total Assets
Rp267.5 tn
Rp320.7 tn
19.9%
Total Deposits
Rp205.7 tn
Rp247.5 tn
20.3%
Low Cost Deposits
Rp109.1 tn
Rp152.4 tn
39.7%
• Current Accounts
Rp 48.8 tn
Rp 66.9 tn
37.2%
• Savings Accounts
Rp 60.3 tn
Rp 85.4 tn
41.7%
Total Loans
Rp117.7 tn
Rp138.3 tn
17.5%
*Consolidated
4
Building momentum for growth (2)
Loans by SBU*
(Rp Bn)
Corp
Small
Comm
Micro
Cons
70
1.7
7.6
60
10.7
50
40
2.7
42.1%
13.1
47.2%
1.9
8.9
11.1
14.2
Rp Savings Deposits
Rp Demand Deposits
FX Demand Deposits
Rp Time Deposits
FX Time Deposits
200
90
80
2007
U
250
110
100
Deposits by Product – Bank Only
(Rp Bn)
27.9%
15.7
150
31.5
29.1%
24.4
93.2
100
25.9
47.7
20
30.9
37.0
28.9%
80.5
13.2
14.9
30
12.6
2007
U
15.9
26.2%
73.4
(8.8%)
14.5
9.8%
50.4
50.0%
81.5
41.5%
33.6
30.1
50
45.2
10
57.6
0
0
Q4 '05
Q4 '06
Q4 '07
Q4 '05
Q4 '06
Q4 '07
*Cash Collateral Loans have been reallocated to Small Business
5
Continue to leverage cash generators (1)
Consumer
Finance &
Micro & Retail
Banking
Rp2,633 bn
33
Providing Services & Business Development for
Oil & Gas Company
Corporate &
Treasury
Building
Future
Growth
Engine
Performance
to Date
Mandiri Prioritas Membership
143 New
Customers
185 Customers
Liabilities Product & Investment
Product
IDR 75.1 bn
IDR 85.0 bn
Consumer
Cards
Corporate Card
1,600 cards
2,314 cards
Consumer
Loans
Mitrakarya Mandiri
IDR 150 bn
IDR 160 bn
Lending to Petrol Distributors
IDR 50 bn
IDR 8.6 bn
Lending to Petrol Sub-agents
IDR 50 bn
IDR 0.44 bn
Employees Cooperatives
IDR 39 bn
IDR 16.2 bn
IDR 37 bn
IDR 18.3 bn
Trade Service
USD 1.84 bn
USD 2.23 bn
EDC on SPBU
150 units
259 units
-
3,000 account
(IDR 29 bn)
USD 7.71 bn
USD 5.30 bn
IDR 3 tn
IDR 5.4 tn
Rp3,830 bn
Wealth
Management
11
Leveraging
Our Cash
Generator
Optimizing
Optimizing
Synergies
Synergies
Across
Across SBUs
SBUs
Strengthen
Emerging
Business
Targets
Groups
Facilities
Micro Business
22
Commercial
Banking
Rp2,063 bn
Small Business
Delivery Order SPBU
Commercial
Banking
Mass &
Electronic
Banking
Payroll
Foreign Exchange
Contribution Margin (Net Profit Before Tax)
Treasury
Money Market
6
Continue to leverage cash generators (2)
Supplier/ Employees
Value Chain
Facilities to sub-contractors
providing construction as well as
supplier requirements:
Cash Loans
Non Cash Loans
E-BIZ for Small Business
segment
Leveraging on the large number
of employees:
Payroll Package for payment
of salaries to employees
Consumer Loans for the
employees of the company, ex.
Mitra Karya
Telkom
Customers/Channels
Telkom &
Group
Optimize Funding and
Lending facilities through our
CST Program to increase share
of wallet by offering:
Cash Loans
Non Cash Loans
Cash Management Systems
Treasury products to better
manage currency exposure
from importing capital
goods
Trade products, particularly
for import of capital goods
End User
Leverage Telkom’s customer
base to cross-sell our several
products such as:
Co-branding or introducing
Credit Cards
Cross-sell consumer loan
products
Offer wealth products to
selected customers
Bill payment
In addition, we are also
looking for opportunities to
leverage Telkom’s outlets to
sell Bank Mandiri products
•Sizeable opportunities in generating business for other SBUs
•Deepening relationships with existing customer base
7
Strengthening the Mandiri Group…
Syariah Banking
Investment
Bank
Insurance
Niche Banking
Bank Sinar
Harapan Bali
Total Assets
Rp11.5 tn
Bond Trading Volume
Rp70.8 tn
Total Assets
Rp3.2 tn
Total Loans
Rp173 bn
Total Financing
Rp9.3 tn
Bond Underwriting
Rp3.5 tn
Annual FYP
Rp438 bn
Net Interest Margin
13.7%
Total Deposits
Rp9.9 tn
Equity Trading Volume
Rp49.4 tn
Total GWP
Rp1.4 tn
ROA
3.4%
ROE
16.6%
ROA
5.8%
Embedded Value
Rp466 bn
ROE
19.7%
• Remain the leader in
syariah financing
• Capital injection
program over 3 years
• Cross-sell syariah
products to Mandiri
customers
• Expansion of business to
fully utilize current capital
base
• Cross-sell capital market
services to broad range of
Mandiri customers
• Refocus business toward
higher fee income
• Provide end-to-end bank
assurance business
• Continue to build crosssell opportunities in
various segments
• Bank assurance products
complete our suite of
consumer offerings
• Enhance operating model
• Improve risk management
systems and IT
• Improve productivity
8
Niche Strategy - Bank Sinar Harapan Bali
Total Lending (Rp bn)
175
150
125
100
75
50
25
0
125.9
107.3
2004
2005
Our Strategy & Intent
133.6
2006
172.7
Oct '07
Total NPL (%)
3%
2%
2%
1%
1%
1.25%
0.82%
1.25%
0.70%
0%
2004
2005
2006
Oct '07
14.1%
13.5%
13.7%
2005
2006
Q3 '07
Net Interest Margins
18%
15%
12%
9%
6%
16.0%
Our main focus will be to
strengthen Bank Sinar’s capability
and infrastructure by assisting the
implementation of appropriate
Risk Management Tools, an IT
Platform, as well as Human
Capital Development
We intend to maintain Bank
Sinar’s positioning as the
premiere Micro & SME lending
institution in Bali, through the
introduction of new products
aimed specifically toward this
particular segment
Bank Mandiri will also utilize Bank
Sinar as a vehicle to further
develop and penetrate the Micro
& SME segment in Indonesia,
which is an integral part of Bank
Mandiri’s strategy to develop
high-margin segment
Actions Going Forward
EGM to approve the acquisition
of Bank Sinar is planned for
March 17th, 2008
Following the EGM, and upon
approval from BI (anticipated by
end of March 2008), we intend to
sign the Sale & Purchase
Agreement (SPA) for the
ownership of 80% of Bank Sinar
Before completing the
transaction, we have assigned
personnel to assist Bank Sinar in
preparing for post-acquisition
business development (with
specific focus on strengthening
Risk Management and IT
platform), product development,
and to ensure value preservation
of Bank Sinar during the interim
period
3%
0%
2004
9
Corporate Banking: Establishing Multi-faceted
Relationships
1. Strengthening relationships with existing customers where Bank
Mandiri has a dominant share, including plantations, infrastructure,
SOE’s and other government institutions.
2. Finding opportunities to cross-sell fee-based business through
treasury products, cash management and investment banking
activities.
3. Actively target publicly listed companies with which Bank Mandiri is
currently not garnering a sufficient share, particularly in attractive
sectors.
4. Improve our value proposition through more tailored product
offerings, total relationship management and fast turnaround to
targeted customers.
5. Broaden relationships to offer products and services to our
corporate clients’ suppliers, employees and customers.
10
Corporate Banking: Cross-selling and alliances to expand
our total value chain exposure
Relationships with 145 Top SOEs and Govt Depts
Further driving cross-selling opportunities into other SBU’s
e.g. Free Fuel program to increase utilization of EDCs in Pertamina gas stations
Share of Funding (%) of Top 100 Public Companies
Payroll Loan Growth from Alliance Program
800
100%
40.3%
80%
600
60%
100.0%
40%
400
41.2%
200
20%
11.0%
0%
7.5%
BM
319
391
486
532
Q2 '07
Q3 '07
611
0
Other SOEs Private JVs/Foreign Total
Banks
Q4 '06
Q1 '07
Q4 '07
11
Commercial Banking : Stronger Platform Improved
Distribution Capability
Movement of Commercial Loans
Strategies For 2008
Rp Tn
10.0
17.1
0.1
2. Targets growth in selected geographics
and regions including through take overs
and strengthening distribution
0.1
0.2
24.4
1. Focus on large and medium commercial
to grow quality loan portfolio
31.5
3. Financing the subcontractors of large
corporates particularly in infrastructure,
mining, and telecom
4. Grow the solid and stable source of low
cost funds
2007
Write-Offs
Intra SBU
Movement
FX Impact
Repayments
Disbursement
2006
5. Strengthening the infrastructure of fee
income business, particularly trade finance
and cash management
12
Commercial Banking : Stronger Platform Improved
Distribution Capability
Expanding Scope of Distribution, 2007
Sumatera
Loans = Rp 4.8 Tn
Funds = Rp 5.1 Tn
Java and Bali
Loans = Rp23.8 Tn
Funds = Rp22.2 Tn
Kalimantan
Loans = Rp2.1 Tn
Funds = Rp1.7 Tn
Eastern
Loans = Rp0.7 Tn
Funds = Rp1.4 Tn
Solid & Stable Source of
Low Cost Funds
Rp Tn
Product
2006
2007
Growth
Demand
Deposit
14.76
19.36
31.2%
Rupiah
11.43
15.24
33.3%
FX
3.33
4.11
23.4%
Saving
Deposit*
0.74
1.75
236.5%
Total Low
Cost Fund
14.76
21.11
43.0%
Total
Funding
23.28
30.52
31.1%
CBC = 17 Unit
Floor = 12 Unit
TSC = 9 Unit
Low Cost Fund Ratio = 69.17%
LDR Commercial = 102.95%
* Business Savings Product
13
Treasury & International Banking: Focused on FX and
trade transactions
Volume of Forex Transaction
(USD Bn)
72.5
Singapore Branch Loan Growth
(IDR Bn)
78.7
1,323
52.7
547
375
2005
2006
2007
2005
2006
2007
Strategies for 2008
1. Intensify cross-selling of forex
products and services to our
corporate and large
commercial clients
2. Leverage our overseas network
to grow our syndicated
facilities to high quality
customers in selected sectors
3. Partner with 3rd parties to
improve derivative offerings
4. Enhancing our regional
distribution (RTM) in high
growth, export-oriented
regions in collaboration with
Micro & Retail Banking
5. Seek opportunities to enhance
the yield of our recent
portfolio
14
Micro & Retail Banking : Rapidly growing our high
margin businesses
Breakdown of New Micro
Loans Disbursed
Breakdown of New Small Business
Loans Disbursed
Rp Bn
Rp Bn
2,460
97
31 101
7,118
1,591
289
0.015
2,058
2,549
1,478
Strategies for 2008
580
TOTAL
Cash Collateral Loans
Food Sufficiency Loans
Channeling Loans
Alliance
Cooperatives
Program Loans
Non-Program Loans
TOTAL
Unsecured Micro
Loans
Micro Loans
Rural Banks
1. Build around our strength
in corporate and large
Commercial customers to
quickly build high margin
business
2. Continue to improve our
payment infrastructure
3. Expand our distribution
with a focus on high
margin business
4. Improving sales culture and
productivity of existing
network
5. Cross sell to grow our fee
based income business
15
Micro & Retail Banking: Building upon our solid
infrastructure & extensive corporate relationships
Building on Our Corporate
Strength
Improving Our Payment
Infrastructure
Strengthening Our Distribution
Network
1. Growing micro-loans to
employees of and suppliers
related to our corporate
customers (e.g. loans to petrol
distributors, loan to employee
cooperatives, etc)
Informations
Mutual Funds
Transfer
Education
23,690
Payment/Purchase
Loan Installment
Credit Card
Tax Payment
BCA
30,000
EDCs
Cash Deposit
Insurance
2. Payment Systems for employee
payroll and payment points
3. Saving products and ATM
Services for employees at
corporate company area
Debit Facility
BNI
Micro
Outlets
597
297
Bank Mandiri
Recently Added Features
Insurance Payment
Installment Payment
Education Payment
Multi Payment
Acquiring/ATM Network
Purchase Payment
Credit Card Payment
Branches
& Outlets
1,025
955
4,186
ATM
3,186
Plan 2008
2007
16
Consumer finance: Cross-selling to corporate
employees and driving anchor mortgage products
Breakdown of Consumer Finance*
(Rp Bn)
5,382
3,865
4,501
3,663
Q3 '07
3,437
3,390
3,404
3,522
3,610
Q2 '07
3,010
2,427
3,666
Q1 '07
1,908
2,285
Q4 '06
2,789
1,358
2,644
1,293
1,426
121.4%
1,678
Other
Credit Cards
Payroll Loans
Home Equity Loans
Mortgages
2007
U
47.6%
Strategies in 2008
1. Building on our corporate relationships to
cross-sell our consumer finance products particularly cards and payroll loans
31.7%
2. Continue to focus on growing 3 main
products: mortgages, credit cards, and
payroll & personal loans
(6.2%)
3. Expand our channels through converting
the outlets into business centers and
opening new consumer outlets
4. Optimize the business process, and
continue to improve the existing score
cards
49.1%
5. Focus on top 10 developers and dealers as
main distributors
Q4 '07
*Cash Collateral Loans have been reallocated to Small Business
17
Consumer Finance: Expanding high margin products
& driving developer relationships
Grow High Margin Consumer Finance
Example of Our Push to Focus on Top 10
Developer
85% Share to Total
Housing Sales
18
...translated into specific milestones in 2008
Gross NPL < 5%
Improving return to shareholders, ROE > 19%
Gross loan growth > 22%*
Savings deposit growth to > Rp85 tn
Margin improvement to approximately 5.2%
Retain efficiency ratio below 50%
Increased coverage of NPLs to > 120%
*Prior to the write-off & repayment of NPLs
19
Notes
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20
21
For Additional Information:
Please refer to our website at www.bankmandiri.co.id
Or Contact:
Mansyur Nasution
Corporate Secretary
Tel: (6221) 524 5299
Fax: (6221) 5296 4024
Jonathan Zax
Head of Investor Relations
Tel: (6221) 3002-3171
Fax: (6221) 5290 4249
E-mail: ir@bankmandiri.co.id
PT Bank Mandiri (Persero) Tbk
Plaza Mandiri
Jl. Jend. Gatot Subroto Kav. 36-38
Jakarta 12190
Main Tel: 526-5045