Danamon Announces 2013 Financial Results: LDR Improved to 95.1%; Total Loans Grew 16%; NPAT at IDR 4.04 trillion

12 February 2014

PT Bank Danamon Indonesia, Tbk. (“Danamon”) today announces its 2013 full year financial results, showing an improved regulatory Loan to Deposit Ratio (LDR) to 95.1%, where total loans grew by 16% to IDR 135 trillion, while consolidated net profit after tax (NPAT) was at IDR 4.04 trillion.

Danamon’s total funding, which is composed of current accounts and savings accounts (CASA), time deposit, and long term funding, increased by 21% to IDR 140 trillion. Specifically, CASA increased by 23% to IDR 53 trillion, in which current accounts grew by 33% reaching IDR 21.1 trillion and savings accounts grew by 18% reaching IDR 32 trillion as of December 2013. Danamon’s time deposit rose 19% to IDR 57.6 trillion.

As of December 31, 2013, regulatory LDR reached 95.1% compared to 100.7% last year, improving significantly from 105.4% in the first half of 2013. Danamon’s consolidated Loan to Total Funding ratio stood at 87.4% at the end of December 2013 compared to 89.5% a year ago. As such, Danamon has ample liquidity to fund its loan growth. Danamon’s consolidated Capital Adequacy Ratio (CAR) stood at 17.9%, while standalone CAR was at 17.5%. Meanwhile, Danamon’s Return on Average Asset stood at 2.5%, while Return on Average Equity stood at 14.5%.

“In 2013, the global economy remained volatile, while inflationary pressures and subsquent interest rate hike in the second half of the year created a challenging operating environment. Through prudent management and customer-centric product offerings, from micro, small medium enterprises (SME), and corporate banking to Sharia, automotive, and consumer goods financing, in 2013 Danamon continued to grow and has also set itself to optimize on growth opportunities in 2014,” said Henry Ho, Danamon’s President Director.

Danamon’s total loans amounting IDR 135 trillion increasing 16% compared to last year, was driven by a 12% growth in the micro, small and medium enterprises (MSME) segments, which accounted to 30% of Danamon’s total loans. Danamon’s loans to micro enterprises through Danamon Simpan Pinjam (DSP) booked a 6% growth to IDR 19.9 trillion in 2013 compared to the same period a year ago, while loans to SME, grew by 18% to IDR 21 trillion. Loans to the commercial segment, increased by 31% in 2013 compared to 2012 to IDR 16.6 trillion, while loans to the corporate banking segment booked a 49% growth to IDR 18.8 trillion.

Going forward, the Bank will capitalize on the growth opportunities in the middle-income segment and will continue the momentum to grow faster, both in the mass and non-mass markets, and trade finance.

In 2013, automotive loans through Adira Finance booked IDR 48.3 trillion, a 6% growth compared to 2012. Automotive loans growth reflects the industry’s growth, which was impacted by the down payment regulation last year.

“Danamon’s loan growth in 2013 was accompanied by an improved quality of assets, with non-performing loans ratio reaching 1.9% at the end of December 2013, improving significantly from 2.4% last year,” said Vera Eve Lim, Chief Financial Officer and Director of Danamon.

In addition, Danamon’s fee income increased by 11% in 2013 to IDR 4.9 trillion. Non credit related fee rose 12% to IDR 1.5 trillion driven by general insurance, cash management, and bancassurance.