The counterparty credit ratings on Indonesia's PT Bank Mandiri (Persero) Tbk. reflect the bank's good market position as the largest bank in the Indonesian banking system with its majority government ownership and expected government support. However, these strengths are offset by the bank's weak asset quality. In addition, Bank Mandiri operates in a high-risk, developing economic environment. The quality of the bank's loan portfolio has improved, but it remained weaker than regional peers'. As at Sept. 30, 2008, Bank Mandiri's ratio of gross nonperforming assets (NPAs; including NPLs, foreclosed assets, and some restructured loans) to total loans continued to improve to about 12%, from about 19% in fiscal 2007 and 26% in fiscal 2006. This resulted from the bank writing
