CIMB Islamic views Indonesia as prime market - The Jakarta Post | Company data
(The Insider Stories) – Indonesia has the world’s biggest potential for shariah banking due to its large Islamic population, according to CIMB Niaga, which has more than $900 million in shariah assets in Indonesia and is growing strongly in the country, The Jakarta Post reports.
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CIMB Islamic has named Indonesia as the market with the most potential for its sharia banking due to the country’s large Muslim population, and is therefore expecting the country to contribute 30 percent to overall business by 2015.
CIMB Islamic is the Islamic banking unit of the CIMB Group, the Malaysian-based bank franchise that provides both conventional and sharia banking services.
CIMB Group operates in Indonesia through its local arm, PT Bank CIMB Niaga, which similarly provides conventional services and Islamic banking services via PT CIMB Niaga Syariah.
Badlisyah Abdul Ghani, the CEO of CIMB Islamic, said that CIMB Niaga Syariah contributed 3 percent to the overall assets of the Group’s Islamic banking business.
In their 2012 full-year financial report, CIMB Group announced that CIMB Islamic’s PBT grew 19.8 percent year-on-year to RM535.5 million (US$176.1 million). Meanwhile, CIMB Niaga earned Rp 4.2 trillion (US$432 million) in net profits, with CIMB Group reaping RM4.35 billion.
Ghani further said that, in order to achieve the “ambitious” target, CIMB was looking to expand their Islamic banking services in Indonesia to include investment.
Handoyo Soebali, the director for commercial banking and sharia at CIMB Niaga, added that CIMB Niaga Syariah had largely focused on consumer and commercial funding as well as financing.
As of March 2013, CIMB Niaga Syariah operated through at least 29 sharia banking branches, 554 channeling offices which provide both conventional and sharia banking services nationwide.
In the past three years, the unit has managed to grow its assets by 186 percent to Rp 9.07 trillion (US$933.4 million) as of December 2012 and boost their financing by 317 percent to Rp 7.63 trillion. Meanwhile, third-party funds soared 183 percent in the last three years, reaching Rp 6.99 trillion at the end of last year.
The unit had also extended their market share in the Syariah banking segment to 4.65 percent as of last year, from 3.3 percent at the end of December 2010.
