FOCUSED ON SERVING THE MASS MARKET, BTPN’S CREDIT GROWS BY 14%, WITH 0,7% NPL (GROSS) AND CAR REACHING 24%
Jakarta, 21 April 2014 – With its commitment to serving and empowering the lower income segments of society, micro & small enterprise entrepreneurs, and productive poor communities (mass market), PT Bank Tabungan Pensiunan Nasional Tbk (BTPN) continues to record a positive performance.
This is evidenced by credit disbursement in the first quarter of 2014 which showed healthy growth with an extremely low non-performing loan/NPL ratio. BTPN recorded annual growth of 14% (year-on-year/yoy), from Rp 41 trillion as of 31 March 2013 to Rp 47 trillion as of 31 March 2014. This achievement was in line with the expectations of regulators which had targeted a rise in credit in the range of 15% in order for a more balanced and robust growth of the economy.
“The impact of dynamics on the economy since the second semester of 2013 is continuing until now. We are certainly grateful that we have managed to keep growing amidst such challenging economic circumstances,” said Jerry Ng, President Director BTPN.
The condition of the national economy is still being overshadowed by high inflation, hikes in deposit interest rates and the recovery of the global economy. These circumstances are driving the banking industry to make a number of adjustments, including slowing the pace of credit. “We are optimistic, however, that once this situation passes industry will once again grow even stronger than before,” he continued.
Growth in credit disbursement continued to be counterbalanced by the application of prudent banking principles, as reflected in the level of gross NPL of just 0,7% by the end of March 2014, unchanged from gross NPL at the end of March 2013.
This growth in credit and the low level of non-performing loans cannot be separated from BTPN’s strategy of providing continuous training and guidance to debtors. This training and guidance, which makes up the Daya Program, is aimed at enhancing the capacities of pensioner customers, micro & small enterprise entrepreneurs, as well as productive poor communities. “Customers who are disciplined and put into practice the financial guidance they have received immediately feel the benefits of the Daya Program when running their business,” Jerry added.
During the first three months of 2014, BTPN organized 46,233 Daya activities, an increase of 194% from the same period in 2013. Meanwhile, the number of customers participating in the Daya Program reached 566,772, a rise of 101% (yoy). This data shows the high level of interest that mass market customers have in taking part in empowerment projects that are able to enhance their business capabilities.
In line with company efforts to slow the pace of credit, BTPN is balancing its funding portions by paying close attention to liquidity adequacy. As of 31 March 2014, BTPN’s Third Party Funds (TPF) were recorded at Rp 49,3 trillion, a rise of 6% from the same period last year when they stood at Rp 46,6 trillion. “With this strategy, our loan to deposit ratio (LDR) has been maintained at a level of 95%. If we take into account funding from bonds, our liquidity ratio becomes a very robust and healthy 84%,” said Jerry.
The relatively moderate growth on the side of credit and TPF has driven a rise in BTPN assets of 8% (yoy) from Rp 62,6 trillion to Rp 67,3 trillion as of 31 March 2014. In addition, the current capital adequacy ratio/CAR stands at 24%, far above the ideal threshold set by regulators.
Jerry is optimistic about the growth of BTPN going into the future. “With a strong CAR, and above all with the Sumitomo Mitsui Banking Corporation (SMBC) joining us to become one of our controlling shareholders, we are confident of increasingly strengthening BTPN’s business and growth in the years to come.” On 14 March 2014, SMBC wrapped up the process of purchasing BTPN shares. Now, BTPN has two credible and reliable controlling shareholders, namely TPG Nusantara S.a.r.l (25,88%) and SMBC (40%). The presence of these two controlling shareholders is sure to have a positive impact on the performance of BTPN.
In the first quarter of 2014, BTPN recorded net profit after tax (NPAT) of Rp 493 billion. In comparison to net profit in the fourth quarter of 2013 (quarter over quarter/QoQ), this represents growth of 8%.
Furthermore, Jerry revealed that in the midst of these challenging economic conditions, BTPN has been consistent in continuing to invest and expand. This has included, amongst other things, the acquisition of Bank Sahabat Purba Danarta, the expansion of its distribution network, and the continued development of its Syariah business unit that focuses on productive poor communities. “The Syariah business model that we are developing is very labour intensive. At present, the BTPN Syariah business unit employs 8,275 members of staff, and in the first quarter of 2014 it disbursed Rp 1,6 trillion worth of credit to productive poor customers, an increase of 161% in comparison to the first quarter of 2013,” Jerry concluded. Moreover, BTPN currently has a total network of more than 1,200 offices and its total number of employees has reached more than 23,000.