SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2009, 2008 AND 2007 Expressed in millions of Rupiah, unless otherwise stated Appendix 513 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued f. The Minimum Statutory Reserve On 23 October 2008, Bank Indonesia issued a regulation PBI No. 1025PBI2008 concerning amendment of PBI No. 1019PBI2008 dated 15 October 2008 regarding the Minimum Statutory Reserves at Bank Indonesia for Commercial Banks in Rupiah and foreign currencies. In accordance with such regulation, the minimum ratio of Statutory Reserves which Bank shall maintain is 7.50 from Third Party Funds TPF in Rupiah which consist of Primary Minimum Statutory Reserves and Secondary Minimum Statutory Reserves. The Minimum Statutory Reserves in foreign currencies is 1.00 from TPF in foreign currencies. Primary Minimum Statutory Reserves is 5.00 of TPF in Rupiah which was effective on 24 October 2008 and Secondary Minimum Statutory Reserves is 2.50 of TPF in Rupiah, effective 24 October 2009. On 6 September 2005, Bank Indonesia issued a regulation No. 729PBI2005 concerning changes of Bank Indonesia Regulation No. 615PBI2004 on Statutory Reserves of Commercial Banks with Bank Indonesia in Rupiah and foreign currency. This regulation was effective on 8 September 2005. In accordance with the regulation, regulated additional Statutory Reserves of Commercial Banks in Rupiah for Banks with Loan to Deposits Ratio 50.00 to 60.00 were previously required to maintain an additional Rupiah statutory reserves of 3.00 of the third party funds in Rupiah and commercial banks with third party funds more than Rp50,000,000 shall maintain additional Statutory Reserves of 3.00 of third party funds in Rupiah, therefore the minimum ratio of Statutory Reserves which the Bank shall maintain is 11.00 for Rupiah and 3.00 for foreign currency .

g. Placements with Bank Indonesia and Other Banks

Placements with Bank Indonesia and other banks represent placements in the form of Bank Indonesia deposit facility FASBI, sharia FASBI, call money, “fixed-term” placements, time deposits and others. Placements with Bank Indonesia are stated at the outstanding balances less unearned interest income. Placements with other banks are stated at the outstanding balances less any allowance for possible losses.

h. Marketable Securities

Marketable securities consist of securities traded in the money market such as Certificates of Bank Indonesia SBI, Sharia Certificates of Bank Indonesia SBIS, Surat Perbendaharaan Negara SPN, Negotiable Cerfiticates of Deposits, medium-term notes, floating rate notes, promissory notes, Treasury Bills issued by other country government and Republic of Indonesia’s Government, mandatory convertible bond, export bills, securities traded on the capital market such as mutual fund units and securities traded on the stock exchanges such as shares of stocks and bonds including Sharia Corporate bonds. Investments in mutual fund units are stated at market value, in accordance with the net value of assets of the mutual funds at the balance sheet date. Any unrealised gains or losses at the balance sheet date are reflected in the current year’s consolidated statement of income. The value of marketable securities is stated based on its classification, as follows: 1 Marketable securities classified as trading are stated at fair value. Unrealised gains or losses resulting from changes in fair value are recognised in the current year’s consolidated statement of income. Upon the sale of marketable securities in a trading portfolio, the difference between selling price and fair value is recognised as a realised gain or losses on sale.