Danamon Announces 21% NPAT Growth in the First Nine Months of 2017

30 October 2017


Jakarta, 30 October 2017. PT Bank Danamon Indonesia Tbk (“Danamon”) today announced its first nine months 2017 financial results.

The bank booked a net profit after taxes (NPAT) of IDR 3.0 trillion in the nine month period of 2017, which is a 21% growth as compared to a year earlier. The profit grew on the back of higher net interest income as a result of ongoing transformation, well-maintained operating expense, and lower cost of credit.

“Danamon continues to record profit growth, as our strategy to streamline operations and diversify revenue streams progresses according to plan. Our asset quality showed significant improvement, resulting in a reduced cost of credit. At the same time, cost of fund continued its downward trend as we improve funding franchise and increase granular saving accounts,” said Vera Eve Lim, Chief Financial Officer and Director, Danamon.

Growth in SME, Enterprise, and Consumer Mortgage loans

Danamon loan portfolios continue to diversify towards non-mass market segment. The Bank recorded growth in the Small Medium Enterprises (SME), Enterprise and Mortgage segments. SME Banking portfolio increased 10% to IDR 27.5 trillion. Enterprise Banking portfolio, consisting of Corporate, Commercial banking, and Financial Institutions, grew 7% to IDR 35.7 trillion. Mortgage loans grew 31% to IDR 5.4 trillion.

Excluding Micro financing, overall loan portfolio and Trade Finance grew 5% to IDR 119.2 trillion as compared to the same period last year. Adira Finance’s new financing amount grew by 7% year-on-year for the two wheelers segment and 8% for the four wheelers segment. Adira Finance’s total financing stood at IDR 44.2 trillion or up 1% compared to a year ago.

Healthy Liquidity and Capital

With Loan to Funding Ratio (LFR) of 93.8%, liquidity is well managed. At the same time, Current and Savings Accounts (CASA) increased by 5% to IDR 47.8 trillion, and CASA ratio improved to 47.5% from 43.9% a year ago. Time Deposit decreased by 9% to IDR 52.7 trillion as Danamon let go of higher priced third-party funds.

Danamon’s capital adequacy ratio (CAR) remained one of the best among peer banks. Consolidated and bank-only CAR stood at 22.3% and 23.8%, respectively.

Improvement in asset quality

Danamon continued to improve its asset quality through prudent enforcement of risk assessment procedures, disciplined collection and recovery of debts. Total non-performing loans (NPL) decreased by 6% to IDR 3.9 trillion, whereas the industry’s NPL increased 3% compared to a year ago. Gross non-performing loans ratio stood at 3.3%, which remained below the regulatory limit of 5%. Cost of credit also decreased by 25% to IDR 2.5 trillion. Cost of credit ratio stood at 2.6%, a 90 bps improvement compare to last year.