Dion Bisara & Faisal Maliki Bakoro – Profits at some of the largest companies in Indonesia rose in the second quarter, boosting the case that the economy grew during that period.

Bank Mandiri's net income in the April-June period rose 25 percent to Rp 2.54 trillion ($300 million) from a year earlier. The lender, viewed as a bellwether for the banking industry because it is the largest by assets, saw strong growth in its lending.

The second-quarter figures for Mandiri and other companies were compiled by subtracting first-quarter data from unaudited first-half income statements that were released last week.

Mandiri's net interest margin – the percentage-point difference between the rate it charges on loans and the rate it pays depositors – remained steady from the first quarter to the end of the second quarter at 5.2 percent.

Still, profit growth slowed from the 89 percent rate in the first quarter, when it booked a Rp 1.3 trillion gain from the one-time sale of Garuda Indonesia shares.

At Bank Rakyat Indonesia, Mandiri's closest rival, second-quarter net income jumped 62 percent to Rp 3.53 trillion. That was larger than the 52 percent increase for the first quarter, as micro-lending, which makes up about a third of the bank's total loan portfolio, increased.

Achmad Baiquni, BRI's finance director, expressed confidence about the prospect of the bank doubling its profit in the second half, particularly because it focused on micro-lending.

Those loans disburse as little as Rp 100,000 to small businesses or sole proprietors and carry interest rates of about 24 percent, compared with commercial lending interest of about 12 percent. "Loan growth may look slow, but most of the loans disbursed are micro-credits," Achmad said.

Astra International, a conglomerate that controls the largest publicly traded plantation and the biggest auto distributor, had a 25 percent increase in second-quarter profit, to Rp 4.29 trillion.

Sinar Mas Agro, the nation's second-biggest publicly traded plantation operator, saw profit skyrocket almost sevenfold to Rp 580 billion. It benefited from higher prices for crude palm oil.

Net income at Telekomunikasi Indonesia fell 3.7 percent to Rp 3.11 trillion on a jump in expenses.

For Garuda Indonesia, the national flag carrier, the Ramadan season, which starts today, is likely to boost profitability. Its loss in the second quarter dropped to Rp 2.1 billion from Rp 183.6 billion in the first quarter, when expenses climbed on higher fuel costs. Emirsyah Satar, Garuda's president director, was optimistic the airline would return to profitability by the end of this year as demand picked up during religious celebrations. "Fuel, which accounts for 30 percent of our costs, is our biggest challenge," he said.

With companies reporting large profit increases in the second quarter, some analysts forecast faster growth for the economy. Manufacturing data shows that year-on-year industrial production rose 9.2 percent in May, the fastest rate in three years.

The economy probably grew 6.8 percent in the second quarter, according to David Sumual, an economist at Bank Central Asia, after expanding 6.5 percent in the first quarter.