Dubai International Award

for Best Practices

to Improve the Living Environment












NARATIVE REPORTING FORMAT
7
th
CYCLE - YEAR 2008

PT BANK TABUNGAN NEGARA (PERSERO)
Jl. Gadjahmada No.1 Harmoni
Jakarta Pusat, 10130
Indonesia




Page 1
Annex I: BEST PRACTICES REPORTING FORMAT


1. a) Name of the Best Practice : Affordable Housing for Middle to Lower
Income Group In Indonesia
b) City/Town : Nation Wide
c) Country : Indonesia
d) Region : Asia & Pacific
e) Has this initiative been submitted previously? NO

2. Address of the Best Practice
Name oI the Organization : PT Bank Tabungan Negara (Persero)
Street : 1l. Gadjahmada No.1 Harmoni
P.O. Box : --
City/Town : 1akarta Pusat
Postal Code : 10130
Country : Indonesia
Telephone number : +62216336789
Fax number : +62216346704
Email addresses : webadminbtn.co.id

3. Contact Person : Iqbal Latanro (Direktur Utama / CEO)

4. Type oI Organisation: Others, Commercial Banking

5. The Nominating Organisation (only iI diIIerent Irom above).
---

6. The Partners

Partner 1
a) Name oI Organisation : PT CAHAYA BUMI PRATAMA
b) Address oI the Organisation : 1l. Industri Raya Cikarang No.2
Cikarang Utara, 1awa Barat, Indonesia
Postal Code : 17530
Telephone : +622170219902-03
c) Contact Person : H. DASUKI RAHMAN
d) Type oI Organisation : Others, Developer
e) Type oI Support : Financial Support

Partner 2
a) Name oI Organisation : PT. PERSADA 1AYA ARTHA
b) Address oI the Organisation : 1l. Mandar XIX Blok DF6 No.7
Bintaro, 1akarta Selatan, Indonesia
Telephone : +62217376568, +622159450666
Facsimile : +62217372888
c) Contact Person : IR. HARI1ONO HINDRAD1A1A / TOMI / NANA
d) Type oI Organisation : Others, Developer
e) Type oI Support : Financial Support

Page 2
Partner 3
a) Name oI Organisation : PT KARYA GRAHA CEMERLANG
b) Address oI the Organisation : 1l. Tanjung Duren Selatan No.1
Gedung Tomang Tol Lantai 2
1akarta Barat, Indonesia
Telephone : +62215636913 / +622156942191
c) Contact Person : ERNA
d) Type oI Organisation : Others, Developer
e) Type oI Support : Financial Support

Partner 4
a) Name oI Organisation : PT ISPI PRATAMA LESTARI PERKASA
b) Address oI the Organisation : 1l. Boulevard Artha Gading Blok C15-16
1akarta Utara
Telephone : +62214527777
c) Contact Person : REMMY KOHAR
d) Type oI Organisation : Others, Developer
e) Type oI Support : Financial Support

Partner 5
a) Name oI Organisation : PT BEKASI ASRI PEMULA
b) Address oI the Organisation : 1l. Duren Tiga No.18
1akarta Selatan
Telephone : +62217975955
c) Contact Person : AGUSTINUS ATMADI
d) Type oI Organisation : Others, Developer
e) Type oI Support : Financial Support

7. Financial Profile
(in million $)
No Partner Year 2004 Year 2005 Year 2006 Year 2007 TOTAL
1 PT Cahaya Bumi Pratama 33.71% 6.01
2 Persada Jaya Artha, PT 42.62% 48.39% 39.29% 15.99
3 Karya Graha Cemerlang, PT 27.74% 13.04% 4.78
4 spi Pratamalestari Perkasa, PT 43.14% 23.86% 13.96% 9.36
5 Bekasi Asri Pemula, PT 100% 14.24% 4.92
TOTAL 3.35 11.02 8.85 17.82 41
Note: USD 1 approx. to IDR 9200

8. Category of the Best Practice:

Housing
O Affordable housing production O Homelessness
O Access to housing finance and
improvement
O Slum and settlement upgrading
O onstruction industry O Building materials and construction technology
O 6ual access to housing resources
and ownership
O Rental housing
O By-laws and standards


Page 3
Land Use Management
O and use planning O Geographical inIormation systems
O Development incentives O Open space conservation
O and development O Urban/suburban renewal
O state management O Equal rights to ownership and inheritance
(especially by women)

Housing and Human Rights
O Implementation oI the right to
adequate housing
O Prevention oI Iorced eviction
O Security oI tenure O Secure tenancy
O Provision oI public inIrastructure Ior
adequate housing
O ousing accessibility
O Housing habitability and cultural
adequacy
O ousing affordability
O Equal rights to ownership and
inheritance (by women)



9. Level of Activity
Select one oI the Iollowing that best describes the usual level oI activity:

O Global O Regional (international) O ational
O Provincial/State O etropolitan O City/Town
O Neighbourhood O 'illage O International

10. Eco-System
Select the eco-system in which your initiative usually operates:
O Arid/Semi-Arid O Coastal O Continental
O High Plateau O Island O ountain
O River Basin O %ropical/Sub-%ropical

11. Summary

n 1974, ndonesian government launched its residential development plan. n
order to support its policy, as State Owned orporations, Bank %abungan egara
(or Bank B% was appointed as residential funding institution for middle-lower
income people. Based on the decree from Minister of Financial home ownership
loan was launched. Since that day, Bank B% provide subsidized home ownership
loan for all ndonesian middle lower income community and also middle up home
ownership. At present day Bank B% has formulated main objective to give
outstanding services in housing finance and its related industry, and also
providing other products and banking services. ome loan becoming the core
business of Bank B%, by the end of 2 it's reached by 91" of oan portfolio,
and the rest are located as different types of loan. By the end of 27 Bank B%
have been financing subsidized home loan more than 1.939.537 units (Retail
customer and disbursing for about Rp.2.78,48 million (e6uals to USD 2.248
million.


Page 4
12. Key Dates

%here are no particular dates for such main mission to be conducted. n order to
conduct all corporate objection and initiatives, the home loan was disbursed all the
time during office hours. Any customer may come to the Branch Office to consult
with the customer service concerning their needs about housing finance at any
time. %he customer may also come to our partners (housing developer who
provide the housing project. Our partners will direct them to Bank %abungan
egara branch office and give the customer with supported document or
information that may needed in home loan application documentation. But the key
dates for national housing movement started since
O 1974 when the government assigned Bank as residential funding institution
for middle-lower income people
O 27 When the Bank initiates the 27 Annual orporate planning and
develop Strategic orporate Planning 28-212.

13. Narrative

SITUATION BEFORE THE INITIATIVE BEGAN

Prior to 1974, there was no home loan for ndonesian people. ndonesian people
who wish to build a residential house, must take consumption loan from the bank
or saving some money. %here was no special loan addressed for home ownership
even a subsidized credit scheme/home loan for middle to lower income group.
%here was also no housing/property developers established to provide affordable
housing project. Only people who have a good financial condition can build an
affordable house.


ESTABLISHMENT OF PRIORITIES

Based on the year 27 Bank %abungan egara orporate Planning, with regard
to corporate main objections in housing loan, the top list priorities formulated
need to be conducted as follows:
O ew credit line Rp.7.43, billion.
O ntegrate marketing program campaign to improve prospect customer
awareness towards Bank %abungan egara existing as a Bank who serves the
customer with the needs for housing by applying one stop banking strategy in
housing program.
O mproving the loan delivery service processes.
O mproving human resources 6uality in loan services delivery.
O mproving the competitive advantage of the loan product line.
O mproving loan documentation administration.




Page 5
FORMULATION OF OB1ECTIVES AND STRATEGIES

Based on the year 27 orporate Planning the management has formulated the
main objectives for loan activities as follows:
O mproving loan services
O Maintain the loan 6uality
O valuating and develop the line of loan product
O Promoting the loan products

Based on the Bank %abungan egara 28-212 orporate Planning, there are
five main strategies formulated by the Management as follows:
O %o give outstanding services in housing finance and its related industry,
consumption loan, and Small and Medium enterprise
O mproving competitive advantage by product development innovation, services
and strategic network based on ultimate technology.
O Develop a 6uality human capital, a professional and with high integrity
O onducting banking management based on prudential banking principle and
good orporate Covernance to improve shareholder value
O orporate social responsibility for the rest of people and surrounding
environment.


MOBILISATION OF RESOURCES

n order to support corporate operation and to achieve financial objective while
still providing subsidized home loan for middle to lower income people, Bank
%abungan egara continue to raise fund surplus and exploring all possibilities to
mobilize low cost fresh fund resources as follows:
O Developing low cost retail product feature
reating a new product feature can be very useful to preserve the customer
retention. %his is very important and become one factor to keep the customer
loyalty.
O ow cost fund surplus
ow cost fund surplus is very important in order to keep the cost loan able fund
low
O mitting A new Obligation
ew Obligation emission very useful to keep the corporate operation and
financial leverage stays on its track, while the other type of retail product must
be maintained carefully
O orporate Privatization
Privatization is a way to leverage Bank %abungan egara its capability to
disburse home loan and getting a fresh fund to support the corporate
operation.
O Mortgage Securitization
Mortgage Securitization will provide a fresh fund through intensive assets turn
over.

%he Covernment as the subsidy provider for healthy and simple housing (RS
also encourages all of Banking/on Bank institution in ndonesia to serve RS

Page 6
loan disbursement. %he Covernment negotiates with %he entral Bank to create
incentive for banking institution who serves RS loan disbursement for Middle to
ower ncome Croup.


PROCESS

Bank B% corporate objection is to give outstanding services in housing finance
and its related industry and also providing other products and banking services. n
parallel, Bank B% must support the ndonesian Covernment in ational ousing
Policy to Provide Subsidized oan for Middle to lower ncome people e.g. Cerakan
asional Pembangunan Sejuta Rumah (Developing a million affordable house
ational Movement and developing rental and owned low cost apartment. %he
Covernment Policy seems to be not successfully implemented because the national
movement did not get fully supported by ade6uate national budget. ven %hough
Bank B% keeps on trying to help the ndonesia Covernment by raising a new credit
line for middle to lower income group.

Bank B% had made some financial projection for five years to come in order to
meets the needs for affordable housing. Bank B% has initiate an option needs to be
done in order to meets such need for affordable housing through Privatization and
Mortgage Securitization. An ndependent consultant also invited to do some study to
review and to develop visible options for Bank B% with regards to financial
projection result. %he privatization through nitial Public Offering right now is
waiting for the government approval, meanwhile the mortgage securitization will be
launched as soon as all supporting regulation clearly set up. Privatization and
Mortgage Securitization will leverage Bank B% financial capability to provide low
cost fresh fund and will make the home loan disbursement through the Bank's
partner (ousing Developer more affordable.

Another problem for Bank B% to support the outlet expansion is limited amount of
human resources. ew employee need to be recruited to fill the position on a new
outlet. %his problem gradually alleviated, and the outlet opening launched as
scheduled as soon as the Bank ndonesia granted the outlet opening licensed.
nternal resources of low cost fresh fund are limited. %o deal with this problem Bank
B% continue to improve its marketing campaign and creating a new product
feature to preserve the customer loyalty.






Page 7

ealthy and Simple ousing (RS oan Disbursement Flow hart





























%he flow chart shows how Affordable housing delivered to Middle to ower ncome
Croups. Bank %abungan egara disburse construction loan to ousing developer.
ousing developer build the housing project. %he customers buy the house with
ousing loan facilities from Bank %abungan egara. %he Covernment plays role as
the ational housing program regulator and providing an interest subsidy.














Bank B%
Partner/
Developer
iddle to ower
Income
Customer
Government
( Regulator &
Interest subsidy
)provider
RSH Housing
Project










Page 8

RESULTS ACHIEVED

(Rp. miliar)
NPL KPR NASIONAL NationaI Market Share
Non Subsidy Subsidy TotaI Non Susbsidy &KPA KPR TotaI Bank BTN NationaI
ec-02 3,779 5,430 9,209 4.76% 21,773 27,203 33.85% 14.38% #V/0!
ec-03 5,102 5,376 10,478 3.80% 30,108 35,484 29.53% 13.78% 30.44%
ec-04 6,010 5,833 11,843 3.21% 42,099 47,932 24.71% 13.02% 35.08%
ec-05 7,340 6,742 14,082 4.04% 56,034 62,776 22.43% 18.91% 30.97%
ec-06 8,081 8,264 16,345 3.91% 72,713 80,977 20.18% 16.07% 28.99%
ec-07 9,095 10,847 19,942 3.88% 94,253 105,100 18.97% 22.01% 29.79%
rowth Bank BTN
MARKET SHARE KPR BANK BTN
Note: KPR means home mortgage

Bank B% is a market leader in ousing oan in ndonesia. %he table above
shown Bank %abungan egara market share in 22 - 27 periods. At the end of
year 27, Bank B% had been disbursed Rp. 9.95 million ommercials ousing
oan and Rp.1.847 million subsidized ousing oan for Middle to ower ncome
Croup (Unaudited, Market share for total reach about 18.97". Bank %abungan
egara manages to keep the on Performing oan ratio below 5". %he P
Ratio for 27 reaches 3.88" (Unaudited.

oan Disbursement Achievement in more detail can be seen on the table attached
to this arrative Formatting Report. By the end of 27 Bank %abungan egara
disburse not less than 1.939.537 unit (Retail customer and disbursing for about
Rp.2.78,48 million (e6uals to USD 2.248 million.



SUSTAINABILITY

A critical point about the affordable housing program in ndonesia is limitation of
low cost fresh fund. %here are some ways to minimize the limitation.

a. %his kind of great work has been established since 1974. %he Covernment
ousing Agency realize that Bank %abungan egara resources is limited and
realize that must be way out to support government policy provide affordable
housing for all ndonesian people. n 24 %he Covernment ousing
Department initiate Memorandum of Understanding with 33 Banking
nstitution in ndonesia to distribute or disburse KPR RS (home mortgage for
affordable housing for Middle to ower ncome Croup with nterest Rate
subsidy mechanism.

%he table below shows the target and realization KPR RS disbursement in
2 as the MOU result.


Page 9
aIam Jutaan Rupiah, kecuaIi unit
No. Bank Name TARET AdditionaI
Unit share (%) Loan
1 BTN 100,000 83,273 97.21 2,735,093 MOU
2 BTN SYARIAH 200 195 0.23 5,279 MOU
3 BNI 2,906 621 0.72 2,321 MOU
4 BRI 3,000 107 0.12 343 MOU
5 BANK BUMI PUTERA 0 8 0.01 40 MOU
6 BANK PERSYARIKATAN 2,000 0 0.00 0 MOU
7 BANK KESE1AHTERAAN EKONOMI 300 0.00 MOU
8 BANK BUKOPIN 1,000 0.00 MOU
9 BANK DANAMON 4,500 0.00 MOU
10 BMT MARDLATILLAH, MA1U 1AYA, AN NA1AH 400 49 0.06 MOU
11 BANK SYARIAH MANDIRI 200 0.00 MOU
12 BPD NANGGRO ACEH D 1,500 0.00 MOU
13 BPD SUMUT 1,663 0.00 MOU
14 BPD SUMSEL 400 94 0.11 226 MOU
15 BPD RIAU 725 0.00 MOU
16 BPD 1AMBI 500 0.00 MOU
17 BPD BENGKULU 450 0.00 MOU
18 BPD SUMBAR (BANK NAGARI) 1,200 0.00 MOU
19 BPD LAMPUNG 0.00 MOU
20 BPD DKI 1akarta 1,500 114 0.13 442 MOU
21 BPD 1ABAR 2,900 48 0.06 240 MOU
22 BPD 1ATENG 350 20 0.02 100 MOU
23 BPD DIY 64 10 0.01 50 MOU
24 BPD 1ATIM 2,500 0.00 MOU
25 BPD KALSEL 1,000 152 0.18 551 MOU
26 BPD KALTIM 2,900 739 0.86 3,956 MOU
27 BPD KALBAR 500 112 0.13 305 MOU
28 BPD KALTENG 100 0.00 MOU
29 BPD SULAWESI TENGGARA 3,000 0.00 MOU
30 BPD SULAWESI TENGAH 170 0.00 MOU
31 BPD SULAWESI SELATAN 750 68 0.08 213 MOU
32 BPD NTB 120 51 0.06 191 MOU
33 BPD NTT, MALUKU, PAPUA 3,750 0.00 MOU
T O T A L 140,548 85,661 100.00 2,749,348
ReaIized KPR
2006
RSH MOU MEMBER


As result many of ndonesia people especially those who live as middle to lower
income group can take benefit from the government policy in affordable
housing program

b. Bank %abungan egara Privatization
Privatization is a way to leverage Bank %abungan egara its capability to
disburse home loan, and getting a fresh fund to support the corporate operation.
But this is has not been done yet even though its get fully supported by the
ndonesian ouse Representative.


LESSONS LEARNED

O n order to fulfil the needs of affordable housing for middle to lower income
people an ade6uate low cost fresh fund need to be mobilized. %he Covernment and
the private sector should have to work together to create a conducive economic
condition where as the low cost fresh fund mobilization will prevail intensively.
ow cost Fresh Fund can be mobilized easily through stock market. ong term
government obligation can be used as subsidized home loan resources. %he
mortgage securitization will receive fresh fund if supporting regulation was set up
already.

O ousing/property market should be deregulated by government to minimize the
housing demand gap. %he government should also give the incentive for subsidized
home loan developer. Unnecessary regulations sometimes discourage developer to
develop a housing project, and this situation will lead to higher price/unit of the
house.

Page 10

O A Creat support for Bank %abungan egara for privatization to provide
commercial and subsidized home loan. ndonesian ouse representative fully
support the government and the Bank %abungan egara management policy to
conduct the privatization via initial public offering. nitial Public offering will
leverage the Bank %abungan egara loan disbursement capability. %he higher
amount loan would be disbursed the greater amount of middle to lower income
people will be served.

O Bank %abungan egara as state owned enterprise, with developer as partner and
Covernment Agency have worked together to provide affordable housing for
middle to lower income groups. ven though the lack of supply Affordable
ousing still hard to meet the housing demands. All of support still needed to
mobilize all resources to provide affordable housing for middle to lower income
groups.


TRANSFERSABILITY

Bank %abungan egara as state owned enterprise, with developer as partner and
Covernment Agency have worked together to provide affordable housing for middle
to lower income groups. ven though there still a lot of lack of Affordable ousing
market supply it is still hard to meet the housing demands. We still need a big
support to mobilize all resources to provide affordable housing for middle to lower
income groups.

%his kind of great work has been established since 1974. %he Covernment ousing
Agency realize that Bank %abungan egara resources is limited and realize that
must be way out to support government policy provide affordable housing for all
ndonesian people. n 24 %he Covernment ousing Department initiate
Memorandum of Understanding with 33 Banking nstitution in ndonesia to
distribute or disburse KPR RS (affordable ousing for Middle to ower ncome
Croup with nterest Rate subsidy mechanism.



RELATED POLICY/IES OR LEGISLATION

%his practice had been getting fully supported from the Covernment ousing
Department and ndonesian ouse of representative. Recent government policy on
ational affordable ousing program is:

a. Ministry of ousing Regulation o. 5/PRM/M/27 regulate subsidy
facility for Middle to lower income group who wish to build their own house
to get support from subsidy housing loan from the bank institution.
b. Ministry of ousing Regulation o. /PRM/M/27 regulate subsidy
facility for Middle to lower income group who wish to build their own house
to get support from subsidy housing loan with syaria institution principle.
c. Ministry of Finance Regulation o. 3/PMK.3/27 regulate about value
added tax which exclude on purchasing RS below Rp. 49 milion.

Page 11

Bank %abungan egara had been fully support by ndonesian ouse of representative to
do the privatization option to leverage Bank %abungan egara loan disbursement
capability to provide affordable housing loan for middle to lower income group.


14. References

Title oI Article: Source (include author, publication title, volume/number, date, and page
number(s) :

1. InIobank agazine (InIobank, 'angkah Mantap Bank B% dengan Kendali
Manajemen Baru, No.347, Februari 2008, Page 34-36).
2. InIobank agazine (InIobank, '6bal atanro: B% %idak Bisa agi idup di Menara
Cading, InIobank No.347, Februari 2008, Page 34-36).
3. Berita Bank BTN (Bank BTN, website www.btn.co.id,Pemohon Kredit Rusunami
Antri di B%, Bank BTN Website, arch, 13, 2008).
4. Berita Bank BTN (Bank BTN, website www.btn.co.id, Bank nggan Bangun
Perumahan Rakyat?", Bank BTN Website, January , 28, 2008).
5. Berita Bank BTN (Bank BTN, website www.btn.co.id, KPR B% Siap Bersaing,
Bank BTN Website, January , 04, 2008).
6. Berita Bank BTN (Bank BTN, website www.btn.co.id, Fokus Pembiayaan
Perumahan, Bank BTN Website, January , 02, 2008).
7. Berita Bank BTN (Bank BTN, website www.btn.co.id, Segera %erbitkan Oblgasi Rp.1
%riliun, Bank BTN Website, January , 02, 2008).
8. Banjarmasin Post (Banjarmasin Post, website www.banjarmasinpost.co.id, 'Subsidi
RS jadi 8 miliar, September 06, 2007).


Description of Articles

1. InIobank agazine (InIobank, 'Bank B% onfident Step ontrolled by ew
Management, No.347, February 2008, Page 34-36)

Bank BTN role which become dominant Iactor in helping the Indonesia government
providing the need Ior housing Ior Indonesia people has made Bank BTN existence can
not be put aside. Bank BTN perIormance getting better day by day, Iully service all oI
the Indonesian people to have their own home. With its new Board oI director has made
Bank BTN contribution in home owner Iinancing can not be replace by another
institution.
There are some Bank BTN conIident steps in providing loan housing as Iollow:
Improving corporate perIormance
arket leader in loan housing
Improving service quality
Generate a new outlet
Corporate business development
Supporting Indonesian government national housing program


Page 12
2. InIobank agazine (InIobank, 6bal atanro : B% an not live in vory %ower
Anymore", InIobank No.347, February 2008, Page 34-36)

Bank BTN has been playing a big role in supporting aIIordable housing Ior all oI
Indonesian people through out the country and about 97 housing program Ior middle
to lower income group Iinanced by Bank BTN. But now Bank BTN has to change. The
change must support Bank BTN perIormance in the Iuture. Furthermore loan growth
target in 2008 must be raised by 26. The change must be done as quickly as possible,
Iail to do so, Bank BTN will surely out oI business. The Bank BTN new CEO, Iqbal
atanro said Bank BTN Can not live in Ivory Tower anymore. Bank BTN wants to
change the paradigm. To achieve the main corporate mission, Bank BTN corporate
image will have to be transIorming Iorm Bureaucratic to business environment.

3. Bank BTN News (Bank BTN, website www.btn.co.id, Rusunami Applicator are
Queue n ine, Bank BTN Website, arch, 13, 2008)

Rusunami Applicators are Queue in ine. Bank BTN loan director, Purwadi said that is
up Ior now there has been 4000 unit application processed, meanwhile its still 1600-
1700 unit to go Irom Cengkareng, odern land Tangerang, Cawang and 1800 unit to go
Irom up coming rusunami project. Purwadi also mention the loan that had been
disbursed Rp. 800 billion Ior Rusunami and RSH Irom the target Rp.10.043 trillion.

4. Bank BTN News (Bank BTN, website www.btn.co.id, %he Bank nstitution
Reluctant to Support Affordable ousing Program?", Bank BTN Website, January ,
28, 2008)

Recently the Banks Institutions in Indonesia tends to reIuse to disburse a micro loan Ior
small business enterprise. Commercials banking presume disbursing a loan Ior small
business enterprise has a higher risk than a big commercial corporation. The same thing
happens with aIIordable housing loan Ior middle to lower income group. The
commercial bank presume the loan Ior middle to lower income group to get an
aIIordable housing loan has a lot higher risk than iI its disbursed Ior upper income
group to get commercial housing loan. Among 132 Commercial Bank in Indonesia,
practically only Bank BTN constantly disburse a subsidy housing loan Ior middle to
lower income group. Bank BTN has a capital limitation. The demand Ior aIIordable
housing is nearly 600.000 units/annum, but Bank BTN can only support subsidy loan
housing Ior about 100.000 unit/annum. According to Ryan Kiryanto, in order to
stimulate all oI the commercial bank to support Indonesia government in housing policy
is to reduce the risk level oI subsidy housing loan by reducing ATR rate by 15 Irom
40 to 25. This option will enable all oI the Commercial Bank to have a higher
lending capability to disburse the loan especially in subsidy housing loan.

5. Bank BTN News (Bank BTN, website www.btn.co.id, KPR B% ready to compete,
Bank BTN Website, January , 04, 2008)

Bank BTN management realize that the business competition between Bank Institutions
is remain tough and getting harder everyday, especially in aIIordable loan housing. In
order to deal with other competitor, as a breakthrough Bank BTN had launched KPR
platinum with two alternative loan interest rate instalment option. First option is Iix
instalment with interest rate 10.75 just Ior one year instalment and 10.95 interest

Page 13
rate Ior the Iirst Iive year instalment. KPR Platinum is intended targeted Ior lower to
upper income group with loan value above Rp.150 million.

6. Bank BTN News (Bank BTN, website www.btn.co.id, Focusing On oan ousing
(Mortgage", Bank BTN Website, January, 02, 2008).

The Ultimate challenge Ior the new Bank BTN`s Board OI Director Ior the near Iuture
is remain tough because Bank BTN have to conduct its main mission which Iocusing on
oan Housing (mortgage) Ior middle to lower income people.

Bank BTN Iormer CEO, Kodradi said, economically speaking, the Iuture challenge is
remain tough especially when Bank BTN engage in Indonesian Banking architecture
Iramework concerning the single presence policy issue held by Bank Indonesia.
Politically speaking, whether the challenge is remain tough or less is depend on
Indonesian government political will as the owner. Should the government still concern
with its housing program Ior the sake oI Indonesia people, Bank BTN will still survive.

AIter all have been through with all oI economic turbulence in late 1999, Bank BTN
still survive and continuing providing aIIordable housing loan Ior middle to lower
income group in Indonesia.

7. Bank BTN News (Bank BTN, website www.btn.co.id, Bank B% announce to
launch Rp 1. %rillion Debts, Bank BTN Website, January, 02, 2008).

In 2008 Bank BTN initiate to make housing loan growth raised by 28 or about
Rp.10.03 trillion higher than in 2007 which about Rp.8 trillion. In order to support that
loan growth Bank BTN intend to issue Rp.1 trillion debts to anticipate previous debts
that due Ior Rp. 800 billion in 2008. In Parallel, Bank BTN also had planned to launch
privatization trough initial public oIIering (IPO) 30 oI its capital. Bank BTN new
CEO, Iqbal atanro said that Bank BTN will stay Iocus on Housing loan Ior middle to
lower income group and yet still continue to Iine tune the marketing campaign policy
and loan pricing including the interest rate to keep Bank BTN competitive toward the
main competitor.

8. Banjarmasin Post (Banjarmasin Post, website www.banjarmasinpost.co.id, 'ealthy
Decent ousing Subsidy Become 8 Billion Rupiahs, September 06, 2007)

Bank BTN CEO Kodradi said that Bank BTN had lowered the loan interest rates which
becoming 13.5/annum. The policy being taken as responded to Bank oI Indonesia
policy that keep lowered the BI rate which stay on single digit level 8,25. He also
mentions the bank institution business competition especially in housing loan gradually
tougher recently. Customer purchasing power getting better and they want to take a
bigger amount oI loan. To deal with this Bank BTN had launched KPR platinum with
two alternative loan interest rate instalment options. First option is Iix instalment with
interest rate 10.75 just Ior one year instalment and 10.95 interest rate Ior the Iirst
Iive year instalment. KPR Platinum is intended targeted Ior lower to upper income
group with loan value above Rp.150 million.