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Jakarta Post

BTPN sees net profit contract by 9% in H1

BTPN has recorded a contraction in its net profit in this year’s first six months as interest income decreased while bad loans rose. 

Yunindita Prasidya (The Jakarta Post)
Jakarta
Wed, July 29, 2020

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BTPN sees net profit contract by 9% in H1 Employees walk near a screen showing stocks price movements in the Indonesia Stock Exchange building in Jakarta in February 2019. Publicly listed Bank BTPN recorded a contraction in its net profit in this year’s first six months as interest income decreased while the amount of bad loans rose. (Antara/Rivan Awal Lingga)

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ublicly listed Bank BTPN recorded a contraction in its net profit in this year’s first six months as interest income decreased while bad loans rose. 

During the first half of the year, the privately-owned bank’s net profit contracted by 9 percent to Rp 1.12 trillion (US$77 million) from Rp 1.23 trillion in the same period last year. 

Its loan disbursement, on the other hand, grew by 5 percent year-on-year (yoy) to Rp 150.5 trillion, driven by an 18 percent rise in the corporate segment to Rp 88.6 trillion.

“In the middle of a challenging environment like this, Bank BTPN was able to maintain its fundamentals well, accompanied by a healthy credit portfolio, so that the impact of the pandemic could be minimized,” BTPN president director Ongki Wanadjati Dana said in a press statement on Wednesday. 

Indonesian banks saw loan growth fall to 3.04 percent yoy in May from 5.73 percent in April as the pandemic hit the public and businesses’ purchasing power, resulting in cooling loan demand and difficulties repaying existing loans.

At the same time, the industry’s nonperforming loan (NPL) ratio, which puts the value of bad loans in relation to total debt, climbed to 3.01 percent in May from 2.89 percent a month before. 

As of June, BTPN’s NPL ratio increased to 1.12 percent from 0.81 percent recorded in June last year, still lower than that of the wider banking industry. 

The bank also takes part in the government’s pandemic relief program by having approved loan restructuring worth Rp 4.1 trillion as of the end of this year’s first half. The figure is around 3 percent of the bank’s overall loan portfolio. 

BTPN’s third-party funds grew by 4 percent yoy to Rp 101.4 trillion in the first half, while its capital adequacy ratio (CAR) stood at 23.09 percent in June, higher than the banking industry’s average CAR of 22.16 percent in May. 

However, BTPN’s loan-to-deposit ratio (LDR) was recorded at 148.4 percent in June, higher than 146.72 percent booked in June last year. The maximum LDR allowed by Bank Indonesia is 92 percent, as a ratio that is too high indicates that a bank may not have enough liquidity to cover unforeseen fund requirements. 

As people have grown a preference for digital banking amid the pandemic, the bank’s digital banking platform, Jenius, saw a 65 percent yoy increase in the number of registered Jenius users to 2.7 million customers by the end of June, the bank reported.

Stocks of the bank, traded at the Indonesia Stock Exchange (IDX) with the code BTPN, jumped 2.73 percent as of 1:36 p.m. Jakarta time on Wednesday but have lost 30.46 percent of their value so far this year. The main gauge, the Jakarta Composite Index (JCI), lost almost 19 percent of its value so far this year.

 

Editor's note: This article has been revised to correctly state the bank's name, which is Bank BTPN.

 

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