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[Alpha Biz=(Chicago) Reporter Paul Lee] Kookmin Bank's Indonesian subsidiary, Bukopin Bank, has not improved its soundness index despite large-scale provisions last year.
According to the Financial Supervisory Service's electronic disclosure system on the 5th, the equity capital ratio of Bukopin Bank (PT Bank KB Bukopin Tbk) stood at -7.32% in the first quarter of last year. The figure is 0.76 percentage points (p) worse than the end of the previous quarter.
The equity ratio is an indicator of the bank's capital soundness. The Bank for International Settlements (BIS) recommends that banks maintain their equity capital ratio and basic capital ratio of more than 8%.
The capital ratio of Bukopin Bank remained at 8.14% until the first half of last year, but it began to suffer losses at the end of last year and the deficit widened this year. During the same period, the basic capital ratio also fell to -8.50 percent.
Last year, it invested 870 billion won and set aside 570 billion won in loan-loss reserves, but failed to defend its soundness. Bad loans have backtracked, rising more than expected. In fact, Bukopin Bank's risk-weighted assets amounted to 4.72 trillion won, up 5.35% from the previous quarter.
AlphaBIZ 폴 리(hoondork1977@alphabiz.co.kr)
