
Indonesian banks' earnings to increase 17-20% in 2013-14F
Thanks to a sustained loan growth of 20%.
Nomura forecasts sector earnings to accelerate to 17-20% in 2013-14F, from 9% in 2012F, on the back of sustained strong loan growth of 20%, resilient NIMs and improving cost ratios.
Here's more from Nomura:
We expect credit cost to remain low as economic growth remains robust in the country while banks’ exposure to commodity sectors is limited.
Asset quality in the sector has improved significantly in the past three years due to improved governance and credit underwriting standards and rising NPL recovery incomes, which we expect to be sustained in the next two years on the back of potential resolution of legacy NPLs at state-owned banks such as BMRI and BBNI.