The Jakarta Post
Amid increasing competition from financial technology (fintech) companies, Malaysian publicly listed lender Maybank Indonesia plans to go digital this year to boost its fee-based income.
Maybank Indonesia president director Taswin Zakaria has said that aside from focusing on its two main segments, namely corporate and micro, small and medium enterprises (SMEs), the lender would also focus on retail banking by using digital technology to offer an appealing and convenient banking experience to its customers this year.
"We will be launching a new digital banking platform called Maybank2u [M2u], as well as a revamped Maybank Indonesia official website in the near future," Taswin told reporters in Jakarta recently.
He added the two platforms would be integrated to make it easier for customers to access its services.
The bank has aside 65 percent of its Rp 220 billion (US$15.6 million) capital expenditure to invest in information technology (IT) infrastructure, including digital banking platforms, Taswin said.
"Banks generally need IT for various purposes, such as digital and security services. The banking industry has seen a rapid development of IT, so it is natural for lenders to allocate large funds for IT infrastructure," he said.
Maybank Indonesia finance director Thilagavathy Nadason said the lender expected a rebound on its fee-based income through its digital banking services as transactions contributed a major portion of its income.
The lender's fee-based income declined 17 percent to Rp 2.26 trillion in 2018 from Rp 2.72 trillion in the previous year.
"Transactions are important for fee-based income. I expect the new website and M2u platform to help boost not only the number of our customers but also customer transactions, especially those who never come to our branches as they prefer to use [mobile] applications," she said.
Despite the decline in fee-based income, the lender's consolidated net profit grew by 21.6 percent year-on-year (yoy) to a new high of Rp 2.19 trillion in 2018.
The lender attributed last year’s profit growth to the 5.2 percent yoy increase in its net interest income to Rp 8.1 trillion and to some improvement in its asset quality.
The decline in net non-performing loans (NPL) ratio to 1.50 percent in 2018 from 1.72 percent in the previous year marked the improvement of the asset quality.
Maybank Indonesia's loans increased by 6.3 percent to Rp 133.3 trillion in 2018 from Rp 125.4 trillion in the previous year. Loan disbursements to the commercial segment accounted for more than half of its credit portfolio, with a 10.9 percent growth in non-retail community financial services (CFS) comprising business banking and SME loans.
The lender also saw growth in its two subsidiaries, automotive financing firm Wahana Ottomitra Multiartha (WOM Finance) and multi-financing company PT Maybank Indonesia Finance, which recorded a 19.4 percent annual increase in profits before taxes, respectively, while its Shariah business saw a 27.3 percent increase in net profit. Maybank Syariah accounts for 17 percent of the bank's total assets.
Maybank Indonesia has a total capital of Rp 26.1 trillion and total assets worth Rp 177.5 trillion as of 2018, a 2.5 percent increase from Rp 173.2 trillion the previous year.
Taswin said that despite its notable performance in 2018, the company would only set its loan growth target at 10 percent this year, considering uncertain economic conditions in the global and local landscape, especially with the presidential election taking place in April. (ars)