D

espite the ongoing economic crisis and tougher competition in the consumers market, DBS bank is still confident of 10 percent growth in its consumer banking.

"We expect slower growth this year. But I believe our consumer banking can still reach double digit growth," Kankipati Rajan Raju, the commissioner of PT Bank DBS Indonesia told a press gathering here on Wednesday, without giving any detailed figures.

Raju, who is also the bank group's managing director noted that in line with the increase in consumer banking, DBS will also see an increase in savings, and for insurance products.

"Because I think people are also seeking to protect their wealth. So we see the growth of investment products required for their wealth protection," said Raju, who claimed that its "AA-" and "Aa1" credit ratings are among the highest credit ratings in the region.

Head of the bank's consumer banking Budiman Tanjung said that DBS is trying to expand its market share in consumer banking by, among measures, opening more branches. "We'll open a branch in Bali this year. So far we have 38 branches, of which 10 are located outside of Java," he said.

He also said that consumer banking contributed about 40 percent to DBS' turnover last year, but its contribution to profits was smaller.

"Most of our income still comes from corporate loans. But our consumer banking sector is increasing. In terms of its profit contribution it is still not yet significant because we have spent a lot on developing it."

"That includes the cost of developing branches across Indonesia," he said.

Both DBS officials did not want to give details on their forecast growth, saying that the bank will still be profitable but at a much lower level than last year. But when asked for details on the financial report, they did not give exact figures.

They said, however, that despite the economic crisis, the bank's non performing loans (NPLs) are still safely below five percent. "Despite the crisis, our NPLs in corporate lending are still safe, that is below five percent. Even the NPL in the consumer segment is much better," added Tanjung.

Looking at regional level, DBS still considers Indonesia as a good investment destination in Asia.

The economy is expected to grow at over four percent, while the other Asian countries, except India and China, will see much slower growth or even negative growth.

Although exports have dropped, Indonesia is still considered to be much better protected from the financial downturn because of its large domestic market and because its banks are less exposed to the subprime crisis in the United States.

DBS, listed on the Singapore Exchange (SGX) as one of the largest financial services groups in Asia with operations in 16 markets, cited Indonesia's relatively strong GDP growth, high interest rates and forecast 10 percent rupiah appreciation as good reasons to invest here.