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Bank Syariah Mandiri struggles to curb bad loans
Bank Syariah Mandiri (BSM) is struggling to improve its non-performing financing (NPF) ratio, which continues to rest at 6 percent following the economic slowdown when its clients began to have problem in loan repayments.
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A bank employee talks to a customer at a Bank Syariah Mandiri outlet in Central Jakarta recently. The Financial Services Authority is preparing for a merger between state-owned sharia lenders Bank Syariah Mandiri, Bank BNI Syariah, Bank BRI Syariah and BTN Syariah. (The Jakarta Post/Jerry Adiguna)
Anton Hermansyah
Bank Syariah Mandiri (BSM) is struggling to improve its non-performing financing (NPF) ratio, which continues to rest at 6 percent following the economic slowdown when its clients began to have problem in loan repayments.
The Islamic lender’s NPF improved slightly last year at 6.06 percent, compared to the 6.84 percent in 2014. However, it remains below the safe NPF level, set by the Financial Service Authority (OJK) at five percent.
"We were in a state of euphoria from 2010 to 2013, when financing grew quickly. But this had not been supported by any backbone. We were lacking of risk management," Finance Director Agus Dwi Handaya told thejakartapost.com on Wednesday.
In 2015, BSM enhanced its operations by adding two more layers to its risk management procedure. Completing the business and risk management monitoring units, the lender added a checks and balances unit.
"We tightened monitoring and accelerated loan restructuring," Agus explained, adding that the lender eyed an NPF level at five percent this year. (ags)
