JAKARTA (TheInsiderStories) – One of the largest bank in the country, PT Bank Rakyat Indonesia Tbk (IDX: BBRI) is considering to conver one of its subsidiaries, PT Bank BRI Agroniaga Tbk (IDX: AGRO) or PT BRI Syariah, to become a digital bank, said the CEO today. The lender has prepared funds Rp5 trillion (US$344.83 million) for this plan and for the units.
Beside BRIAgroniaga and BRISyariah, other subsidiaries that will get capital injections are PT BRI Multifinance, PT BRI Ventura Investama, and PT Asuransi BRI Life. Later, this digital bank will be collaborated with BRI Venture, a subsidiary engaged in the venture capital sector.
“There are BRISyariah and BRIAgroniaga subsidiaries in the form of a bank. That then it is needed specifically to become a digital bank so we just need to convert it,” said the CEO of the bank, Sunarso at one virtual event in Jakarta, on Thursday (07/23).
The unit was established by the Plantation Pension Fund on Sept. 27, 1989 and played an important role in the development of Indonesia’ agribusiness sector. On March 3, 2011, Bank Rakyat Indonesia officially became the controlling shareholder of the lender in 2012 and changed the company’ name to BRI Agroniaga.
Last year, the subsidiary of the small and medium enterprises lender, recorded a net profit of Rp51.06 billion. The profit dropped significantly by 75 percent on an annual basis. In 2019, BRIAgroniaga recorded an increase in total assets by 16.10 percent on an annual basis from Rp23.31 trillion to Rp27.07 trillion.
While, BRISyariah reported the asset grow 33.7 percent to Rp.49.56 trillion in the first half (1H) of 2020 from Rp37.92 trillion in the same period last year. While net profit grew 226 percent from Rp35 billion to Rp116 billion in the first half of this year.
The Islamic bank is optimistic that it will continue to grow positively this year despite the COVID-19 outbreak. Third party funds also recorded a growth of 46.2 percent from Rp28.09 trillion to Rp41.07 trillion and financing grew 56 percent to Rp37.44 trillion from H1 2019 valued at Rp24.01 trillion.
BRISyariah was established on Nov. 17, 2009 as part of Bank Rakyat Indonesia’ goal to offer complete banking services. At present, the local bank operates 272 offices and 500 ATMs.
Recently, the Indonesian government assigned Bank Rakyat Indonesia to disburse loans totaling Rp122.5 trillion over the next three months after receiving an injection of Rp30 trillion in capital from the state along with other state-owned banks. This assignment was an effort to implement a national economic recovery program.
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