Indonesia's BII says Q1 net profit jumps 72 pct

JAKARTA, April 25 (Reuters) - PT Bank Internasional Indonesia Tbk (BII), Indonesia's sixth-largest lender, on Friday said that first-quarter net profit jumped 72 percent as lending rose 29 percent and net interest margins improved.

BII (BNII.JK: Quote, Profile, Research, Stock Buzz) reported net profit of 197.86 billion rupiah ($21.5 million) in the January-March quarter, up from 115.43 billion in the same period last year.

Malaysia's biggest lender, Malayan Banking Bhd (MBBM.KL: Quote, Profile, Research, Stock Buzz), paid $1.5 billion for a 56 percent stake in BII last month, or 4.6 times book value, prompting some analysts to say the Malaysian lender had overpaid.

Maybank has said it will offer $1.2 billion buy BII shares from minority shareholders, bringing the total cost of the acquisition to $2.7 billion.

BII's net interest income climbed 15 percent to 715 billion rupiah, lifting its net interest margin to 5.27 percent from 4.87 percent a year earlier.

"Our performance is encouraging and in line with our expectations. Good progress has been made in building up our core loan and deposit business and improving our loan loss provisions," BII's president director Henry Ho said in a statement.

He also warned that uncertainties in the global financial markets, the tightening of credit spreads, and domestic inflationary pressures from possible fuel and food price rises could affect the Indonesian economy and banking industry.

Demand for loans has picked up in Indonesia, as a decline in inflation paved the way for the central bank to steadily cut its benchmark interest rate BIPG.

As a result, Indonesia's banks have been lending aggressively to businesses and consumers, with loan growth reaching 25.5 percent last year, up from 14 percent in 2006.