Mining Business Increasingly Shining, Bank Mandiri Optimistic Corporate Credit Soars

JAKARTA - PT Bank Mandiri Tbk. optimistic that the corporate sector credit, especially mining, will resume its activity this year. This is indicated by an increase in domestic heavy equipment sales, which grew significantly in the period February 2021.

"This opens up opportunities for better sales increases throughout the year," said the bank with the ticker code BMR in its release on Thursday, April 1.

Referring to data from one of the major retailers United Tractors (UT), domestic heavy equipment sales in February 2021 reached 914 units. This figure grew 53.3 percent on an annual basis compared to the same period the previous year.

Apart from that, on a month-to-month (mom) basis, the realization of growth in February 2021 is also better than January 2021 which amounted to 32.4 percent.

Furthermore, of the four sales categories by sector, two sectors recorded an increase, namely the mining and construction sectors.

Meanwhile, two other sectors, namely agriculture and forestry, experienced contraction. The mining sector, which has the largest share of UT heavy equipment sales (34.9 percent in 2020), recorded a growth of 8.9 percent year-on-year (yoy) in February 2021.

This achievement increased from January 2021's growth of 7.8 percent yoy.

"We estimate that domestic heavy equipment sales will reach 6,123 units in 2021, or grow by 5.9 percent. This is in line with the easing of the impact of the COVID-19 pandemic which has boosted economic performance, ”said Bank Mandiri.

Based on information compiled by the editorial team, the bank's red-plate corporate credit has increased by 3 basis points in the first two months of 2021 from its position at the end of last year to IDR492 trillion.

In terms of performance achievements in 2020, BMRI is known to have booked a consolidated net profit of IDR 17.1 trillion. Even though it produced a large amount of money, the score decreased by around 38 percent from the 2019 period which recorded a profit of IDR 27.5 trillion.

The pandemic factor is suspected to be the cause of the decline in the performance of this financial institution last year which has an impact on the decline in the rate of bank credit expansion.