Release Date: October 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- PT Bank Negara Indonesia (Persero) Tbk (PTBRY, Financial) reported a loan growth of 9.5% year on year, indicating a positive trend in lending activities.
- The company's net interest margin (NIM) improved to 4.4% in the third quarter, surpassing initial expectations.
- CASA (current account savings account) grew by 5.5% year on year, with significant growth in savings accounts at 7.4%, reflecting strong deposit growth.
- The bank's digital initiatives, including the launch of the new mobile banking application 'W by BNI', have shown promising results in customer acquisition and transaction frequency.
- PT Bank Negara Indonesia (Persero) Tbk (PTBRY) has made significant strides in green financing, with IDR71 trillion in green loans, demonstrating its commitment to sustainability.
Negative Points
- The SME segment experienced a contraction, particularly in the KUR portfolio, which decreased by 22% year on year.
- Operating expenses grew by 7.4% year on year, driven by investments in digital platforms and cybersecurity, which could impact profitability.
- The bank's time deposits contracted by 2.6% year on year, indicating a shift away from more expensive funding sources.
- Despite improvements, the loan at risk ratio remains relatively high at 11.8%, suggesting ongoing asset quality challenges.
- The write-off of IDR14.2 trillion in loans, a 41% increase year on year, highlights the bank's efforts to clean up its loan book but also indicates potential credit risk issues.
Q & A Highlights
Q: How does the new administration's economic policy impact BNI's business strategy?
A: Royke Tumilaar, President Director, explained that the new administration under President Prabowo focuses on economic priorities such as food self-sufficiency, infrastructure, energy security, and MSME empowerment. These priorities align with BNI's business strategy, offering new business opportunities and improving consumer purchasing power, which is expected to boost loan demand.
Q: What are the key initiatives in BNI's funding structure transformation?
A: Hussein Paolo Kartadjoemena, Digital and Integrated Transaction Banking Director, highlighted two initiatives: branch transformation, shifting branches from transaction-focused to sales-oriented, and the launch of a new mobile banking application, W by BNI, which has shown positive progress in customer acquisition and transaction frequency.
Q: Can you provide an update on BNI's Explorer initiative for SME exporters?
A: Corina Leyla Karnalies, Retail Banking Director, reported that since its launch in 2021, Explorer has facilitated IDR31 trillion in loans for export-oriented SMEs, with significant growth in CASA and SME debtors. The initiative aims to strengthen BNI's position as a global bank and increase its sustainable SME portfolio.
Q: How has BNI's financial performance been in the third quarter of 2024?
A: Novita Widya Anggraini, Finance Director, stated that BNI achieved a 9.5% year-on-year loan growth and a 3% growth in third-party funds. The bank's net interest margin improved to 4.4%, and non-interest income grew by 15% year-on-year, driven by trading income and fee income from loan syndication and bill payments.
Q: What are BNI's efforts in promoting sustainability and managing asset quality?
A: David Pirzada, Risk Management Director, emphasized BNI's commitment to green financing, with IDR71 trillion in green loans and initiatives like sustainability-linked loans. The bank's asset quality improved, with a lower loan-at-risk ratio and proactive management of restructured loans, maintaining a healthy coverage ratio.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
