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BTN's profits soar over 50% as lending, income grow
Highly profitable: Bank Tabungan Negara (BTN) president director Maryono (facing camera), accompanied by BTN director Mansyur S
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Highly profitable: Bank Tabungan Negara (BTN) president director Maryono (facing camera), accompanied by BTN director Mansyur S. Nasution (to his left) and other directors, presents the firmâs business performance from the first half of 2015. The state-owned lender booked Rp 813 billion (US$60.4 million) in profits during the period, up 54.25 percent from last year, supported by a higher net interest income of Rp 3.19 trillion.(Antara/Yudhi Mahatma) (BTN) president director Maryono (facing camera), accompanied by BTN director Mansyur S. Nasution (to his left) and other directors, presents the firmâs business performance from the first half of 2015. The state-owned lender booked Rp 813 billion (US$60.4 million) in profits during the period, up 54.25 percent from last year, supported by a higher net interest income of Rp 3.19 trillion.(Antara/Yudhi Mahatma)
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span class="inline inline-center">Highly profitable: Bank Tabungan Negara (BTN) president director Maryono (facing camera), accompanied by BTN director Mansyur S. Nasution (to his left) and other directors, presents the firm's business performance from the first half of 2015. The state-owned lender booked Rp 813 billion (US$60.4 million) in profits during the period, up 54.25 percent from last year, supported by a higher net interest income of Rp 3.19 trillion.(Antara/Yudhi Mahatma)
State-owned lender Bank Tabungan Negara (BTN) enjoyed soaring profits and higher-than-expected credit growth during the first half of this year amid sluggish business performance recently forecast by other lenders.
BTN reaped Rp 831 billion (US$61.54 million) in net profits, or 54.25 percent year-on-year (yoy) higher than the Rp 539 billion booked in the same period last year, as loans grew 18.33 percent to Rp 126.12 trillion as of June 30 this year from Rp 106.58 trillion a year ago.
BTN president director Maryono said on Monday that the aggressive profit growth was attributed to its net interest income (NII) amounting to Rp 3.19 trillion, or 19.06 percent higher than last year's.
'We are optimistic about achieving our profit growth target of more than 40 percent by the end of this year,' he said, adding that his company aimed to book 14 to 16 percent in loan growth by the end of this year, in line with the overall industry's growth target.
Commercial banks around the country are struggling to boost lending as Southeast Asia's economy sank to its lowest level in more than five years, with banking regulator Financial Services Authority (OJK) recently slashing its full year nationwide loan growth target to 13 to 14 percent this year from 16 to 17 percent previously.
BTN, whose core business is house financing, had Rp 112.90 trillion in housing loans outstanding during the first half, representing almost 90 percent of overall outstanding loans as of June 30.
Almost a third of the housing loans, precisely Rp 38 trillion-worth, were allocated for subsidized houses while almost 40 percent, or Rp 49 trillion-worth, were for non-subsidized houses.
BTN participates in the government's 'one million houses' program that aims to provide housing for low income families, in which BTN plans to finance 460,000 subsidized housing units and 400,000 non-subsidized ones. The remaining 140,000 houses for low-income people will be fully financed by the government.
Maryono admitted that the housing business for the upper-middle class was sluggish during the first half. However, business for lower-middle class housing was up because of credit subsidy realization by the government.
As of June 30, BTN has realized subsidized housing credits (KPR) amounting to Rp 5.25 trillion for 53,369 houses.
BTN director Adi Setianto said that loan growth was healthy as indicated by declining bad loans in the non-performing loans (NPL) ratio.
'The NPL ratio in the first semester reached 3.37 percent or was lower than last year's 3.83 percent. We aim to reach 3 percent of the NPL ratio by the end of this year,' he said.
To increase its credit quality, the state lender has recovered its assets worth Rp 761.13 billion during the half, already nearing 60 percent of its target. By the end of this year, BTN aims at recovering Rp 1.27 trillion worth of assets.
'Our business is relatively more secure than other [lenders] as our securities are houses. It's easier for us to recover our assets in case of NPL,' he said.
This week, several giant lenders will release their first half business performances, with state-owned lending giants predicting slowing performance during the period. Mandiri forecast a single digit growth in net profits, while BRI admitted lower loan disbursement for corporations because of a slowing economy and BNI revised its credit growth target to 13 to 15 percent from between 16 and 17 percent previously, according to local media reports. (prm)
