Bad loans are spiking at Bank Mandiri, Indonesia’s largest lender by assets, due to its high commodity exposure but the bank says it has a plan in place to mitigate any financial damage.
Non-performing loans (NPLs) hit a six-year high at 2.6 percent of total loans in 2015, up from 2.1 percent in 2014, the bank said in its full-year earnings report after Tuesday’s market close.
Net profit meanwhile climbed 2 percent on-year to $1.5 billion but despite beating analyst forecasts, that was still the slowest pace of growth in a decade, according to Reuters.
Following the earnings announcement, Mandiri said it will avoid exposure to mining as well as oil and gas since China’s economic slowdown has dented commodity demand.
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