Thursday, 22 February 2018 | 02:00 WIB

2017, Bank Danamon Post 38 Percent Profit Growth Sustained by Lower Cost of Funds

Bank Danamon grew 38 percent profit in 2017.

JAKARTA, NNC - PT Bank Danamon Indonesia Tbk (BDMN.JK) posted net profit after tax (NPAT) of IDR3.7 trillion in 2017, growing 38 percent from a year earlier. Profit growth is driven by lower cost of funds, better management of disciplined operating costs, and better asset quality.

Sng Seow Wah, President Director of Bank Danamon, said that the company continues to post profits in line with increasing momentum of long-term strategic initiatives.

"This sustainable profit growth is the result of our efforts to diversify our revenue sources, strengthen our customer service, and implement a comprehensive digital and technology-based solution," said Sng Seow Wah in a press release on Monday (2/12/2018).

In addition, Bank Danamon's loan portfolio continues to shift towards the non-mass market segment. Bank Danamon recorded growth in the Small and Medium Enterprises (SME), Enterprise and Consumer Mortgage segment. Loans in the SME segment grew 10 percent to IDR28.5 trillion. The Enterprise portfolio, comprised of corporate, commercial and financial institutions, went up four percent to IDR37.6 trillion. Consumer Mortgage credit rose 36 percent to IDR6.0 trillion.

Excluding micro-banking, total loan portfolio and trade finance climbed five percent to IDR122.9 trillion from a year earlier. Its subsidiary Adira Finance's new financing went up five percent for motorcycles and six percent for four wheels compared to the previous year. Adira Finance's total financing amounted to IDR45.2 trillion or up two percent compared to the previous year.

Sng Seow Wah added with the loan to funding ratio (LFR) ratio at 93.3 percent, liquidity was well managed. At the same time, current account and savings account (CASA) rose four percent to IDR50.5 trillion. Meanwhile the CASA ratio grew to 48.3 percent from 46.0 percent in the previous year. Deposits dipped five percent to IDR54.1 trillion through the disposal of high-cost funds.

Danamon's capital adequacy ratio (CAR) remains one of the best among its group banks. Consolidated CAR was at 22.1 percent, while the bank's CAR was at 23.2 percent.