BANK MANDIRI CUTS INTEREST RATE ON CREDITS

Jakarta, June 18 (ANTARA) - PT Bank Mandiri Tbk has cut its interest rate on both old and new credits by 0.5 percent as of June 15.

"This is the third cut this year. So our credit interest rate now is between 11 and 15 percent from 11.5 to 16 percent previously," the bank's senior vice president for small business groups, Rafjon Yahya, said here on Wednesday.

He said prudence was still needed with regard to credit extension to construction and manufacturing sectors.

He said Bank Mandiri continued restructuring its non-performing loans.

Right now, Rafjon said, foreign currency conditions were already easing compared to situation in the fourth quarter of 2008 so that extension of credits in foreign currencies was possible while nature of financing was short-term.

"Conditions change in every quarter so the bank's financing is supportive to financial institution financing schemes. Everything is still negotiable," he said.

The interest rate of deposits in the bank is now at an average six percent, he said.

Bank Mandiri has cut its lending interest rate by 50 basis points since January 20, 2009 following the central bank's decision to cut its key interest by 50 bisis points to 8.75 early in January.

The cut in the key interest rate was expected to encourage banks to cut their lending rates to give a positive impact on the real sector.

Some private banks however would not as yet want to cut their lending rates although the central bank had cut the key rate further to 7.0 percent.