S

eizing the momentum of declining interest rates, publicly listed lender Bank Bukopin expects to boost its low-cost third-party funds through promotions and other initiatives this year.

Bukopin, which focuses its business in small and medium segments, was confident it could grow its savings accounts and number of deposit customers by double-digits despite tight competition, an executive said.

Meanwhile, Adhi Brahmantya, Bukopin'€™s director for business and IT development, said the bank saw its savings grew by 14.1 percent to Rp 16.3 trillion (US$1.21 billion) by the end of 2015, from Rp 14 trillion a year earlier.

For this year, Adhi said the bank expected its savings to increase by Rp 3 trillion, a 18.4 percent growth that would help grow its overall third-party funds by 24 percent year-on-year (yoy) to Rp 88 trillion.

In order to achieve the target, he said that Bukopin would continue promoting its initiatives, such as re-launching its savings promotions that offered customers prizes from lucky draws and gifts based on the amount in their accounts

One of the bank'€™s major savings promotions offering many grand prizes was launched on Tuesday and will take place from February to June in order to attract its individual and institutional customers to deposit more funds in their savings accounts.

'€œThe program is one of our strategies to grow our savings as we want to strengthen the loyalty of our customers. We want to maintain sustainable funding for the long term,'€ Adhi said after the launch event in Jakarta.

With the help of re-launched promotions and upcoming initiatives, Adhi said the bank expected to grow the number of its customers by 33 percent to 1.6 million people this year, from the current 1.2 million.

Bukopin general manager for business development Rivan A. Purwantono said the bank was upbeat the efforts could help increase the portion of low-cost funds, or current accounts and savings accounts (CASA), in its total third-party funds.

He said the bank expected to see its CASA portion reach 40 percent of its total third-party funds, from 33 percent as of last year.

He added that with the higher portion of CASA, the bank would be able to continue its efforts to press down its cost of funds and follow the trend of declining time deposit rates following Bank Indonesia'€™s (BI) benchmark rate cut by 25 basis points (bps) in January.

With the help of the BI rate cut, Adhi said Bukopin had also trimmed its time deposit rates by 25 bps, but the bank was still reviewing which lending rates would be slashed as well.

As the bank planned to decrease its lending rates next month, he said the cuts would be conducted gradually as there were still ongoing loans with previous rates calculations.

Based on information, on its website Bukopin has set its prime lending rates at 13.05 percent, 13.34 percent and 17.10 percent for corporate, retail and micro loans, respectively. Meanwhile, mortgage and non-mortgage consumer credits are charged 12.93 percent and 12.89 percent, respectively.