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RETAIL BANKING | Staff Reporter, Indonesia

Maybank Indonesia's profit surged 71% to US$146m in 2016

Thanks to the 10% increase in net interest income growth.

PT Bank Maybank Indonesia Tbk announced that it has delivered the highest ever PATAMI of Rp1.95 trillion (US$146m) for the financial year ended 31 December 2016, a 71.0% increase from Rp1.14 trillion (US$85m) achieved in the previous corresponding year.

The overall impressive performance was achieved on the back of sound NII growth coupled with controlled cost management and better provisioning levels required for the non-performing loans. This achievement was worth noting given the slow economy and challenging business environment.

NII rose 10.8% to Rp6.6 trillion for the financial year ended 31 December 2016 from Rp6.0 trillion in 2015. The strong increase in NII was mainly due to the Bank’s discipline in loan pricing and active funding management. The Bank also reported an increase in its NIM to 4.6% in December 2016 from 4.5% in 2015. 

The Bank’s overhead costs remained stable at Rp4.5 trillion for the financial year ended 31 December 2016 compared with the preceding year, as a result of intensified strategic cost management across the Bank’s operational and business lines. This rigorous cost management effort has brought the CIR to the lowest record of 52.9% as of 31 December 2016 from 55.1% in the previous corresponding period.

The Bank recorded loans growth of 2.9% to Rp115.7 trillion as of 31 December 2016 from Rp112.5 trillion as of 31 December 2015. Global Banking recorded a strong loans growth of  20.5% from Rp21.4 trillion to Rp25.8 trillion as a result of re-aligning and re-profiling of its portfolio that has been implemented by the Bank in the last two years. The Bank’s Small & Medium Enterprises (SME) and Commercial loans growth continued to be the backbone in generating revenues with a 12.3% growth to Rp51.5 trillion. However, Retail banking loans decreased by 15.1% from Rp45.2 trillion in December 2015 to Rp38.4 trillion in December 2016 mainly due to the slowdown in consumer spending.

Throughout the year the Bank’s liquidity position has been strong with LDR (bank only) stood at a healthy 88.9%, while the Loan-to-Funding Ratio (bank only) was at 88.2%. Total customer deposits grew from Rp115.5 trillion for the financial year ended 31 December 2015 to Rp118.9 trillion in 2016 with the CASA ratio reaching 38.7%. The Bank’s continuous focus on its transactional banking, strong financial supply chain solutions, and its electronic channels which include its internet based mobile banking facility Maybank M2U have also greatly contributed to the improved liquidity position.

To strengthen its capital and liquidity, the Bank also issued subordinated bonds of Rp800 billion and Sukuk Mudharabah of Rp700 billion during financial year of 2016.

The Bank improved its loan quality as its restructuring efforts carried out throughout the year have showed positive results. The Bank’s consolidated NPL level was at 3.4% (gross) and 2.3% (net) as of December 2016 compared to 3.7% (NPL gross) and 2.4% (NPL net) in the previous year. The Bank was also able to reduce provision expenses by 19.4% to Rp1.6 trillion compared to the previous corresponding year. Nonetheless, the Bank remains cautious over loan quality as businesses are still impacted by the recent economic slow-down.

The Bank’s CAR improved from 15.2% in December 2015 to 17.0 % in December 2016 with total capital reaching Rp21.8 trillion.

Sharia Banking continued to demonstrate its strong performance throughout 2016. Its total financing grew 61.2% from Rp8.7 trillion in December 2015 to Rp14.0 trillion in December 2016 and total deposits jumped 70.9% from Rp6.4 trillion to Rp10.9 trillion. Sharia Banking’s total assets rose 45.3% to Rp23.2 trillion, contributing to 13.9% of the Bank’s total assets, while its net profit increased 61.9% to Rp466.2 billion in December 2016 from Rp287.9 billion in December 2015.

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