Indonesian government released dual-currency bonds with total amount US$3.1 billion for deficit financing in this year, said the finance ministry today (01/09) - Photo: Privacy

JAKARTA (TheInsiderStories) – Indonesian state-owned (SOE) banks are optimistic that loan growth can grow double digits next year, said the banker to media on Wednesday (11/27). Although, Financial Services Authority (FSA) predicts loan will grow below 10 percent this year.

President Director of PT Bank Rakyat Indonesia Tbk (IDX: BBRI) Sunarso explained, BRI targetted loan growth of 11 percent next year or higher than this year’s prediction in the range of 9-10 percent.

Sunarso revealed, the continuing of lower interest rates was the factor driving the loan growth. However, at the same time, the company must face the challenges of liquidity and declining commodity prices.

In line with loan growth, the company set a net profit of 10-11 percent next year. This figure is higher than this year’s net profit projection of 9-10 percent.

Whereas, until the third quarter of 2019, BBRI posted a net profit of Rp24.8 trillion, growing 5.36 percent compared with the same period last year of Rp23.5 trillion. While loans that have been distributed reached Rp903.14 trillion or grew 11.65 percent compared to the same period of last year.

Furthermore, PT Bank Negara Indonesia Tbk (IDX: BBNI) targetted loan growth in the range of 11-13 percent in 2020. Meanwhile, in the third quarter of 2019, BNI was able to record 14.7 percent loan growth.

BBNI President Director Achmad Baiquni revealed the loan growth would be supported by the implementation of government policies. “Policies that are pro-growth, such as omnibus law, super deductible tax, and structural reforms will support loan growth,” he explained.

Baiquni believed the loan growth is able to boost net profit growth in 2020 to 15-17 percent. The increase in profit will also be supported by a decrease in the cost of funds because BNI is focused on increasing low-cost funds.

On the other hand, PT Bank Mandiri Tbk (IDX: BMRI) was also optimistic for next year. Bank Mandiri Deputy CEO Sulaiman Arif Arianto said that Bank Mandiri was aiming for loan growth of 11 percent in 2020. The projection is higher than this year’s target of 8-9 percent.

Arianto asserted that the company will focus on encouraging the retail segment to achieve the target. Bank Mandiri will also increase the composition of CASA to maintain the cost of funds.

Furthermore, Bank Mandiri targetted net profit’s growth of 6 to 7 percent next year. In the third quarter, the state-owned bank’s profit grew 11.9 percent to Rp20.3 trillion. Although boosting loans, Bank Mandiri will keep bad loans at 2.4 percent-2.5 percent, better than this year’s target of 2.5 percent-2.6 percent.

Previously, Chairman of FSA Wimboh Santoso was optimistic that loan growth could reach 13 percent in 2020. It is in line with the easing of monetary and fiscal policies carried out by Bank Indonesia (BI).

Even though, FSA revised this year’s loan growth in the range 8-10 percent. In the midterm of 2019, FSA was optimistic the loan growth will be in the range of 12-14 percent.

The revision is based on a bank business plan which targetted this year’s loan growth of more or less 10 percent. Also, the assumption is made after seeing thoroughly the loan growth in the first half of 2019.

“The loan growth began to slow down since the end of the first half of 2019,” Santoso adds, saying the slowdown was increasingly greater in the third quarter of 2019 by weakened 7.89 percent to Rp5,464.97 trillion (US$390.35 billion). While the banking industry still experienced double-digit growth or around 11 percent in May 2019.


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