Danamon Quarterly Earnings Reflect Continuous Improvement Despite Social Restriction Challenges

Press Release / 27 October 2021

Share

***

• Enterprise Banking (EB) Portfolio growth of 8% YoY, to reach Rp57 trillion, supported by collaborations with MUFG network and focus on blue chip and State-Owned Enterprises customers.
  
• Current Account and Savings Account/CASA improved by 10%, resulting in a CASA ratio of 57.6%.
  
• Improved Non Performing Loan/NPL% by 16bps to 3.1%
  
• NPL coverage ratio increased from 142% in the previous year to 170%
  
• Net Profit After Taxes/NPAT reached Rp1.4 trillion
  
   

Jakarta, 27 Oktober 2021. PT Bank Danamon Indonesia Tbk (Danamon) announced its 9 Months 2021 financial earnings. The Bank’s performance highlighted a year-on-year (YoY) growth of 8% in the Enterprise Banking and Financial Institution portfolio, which reached Rp57 trillion in comparison to Rp53 trillion in the previous year. Danamon also recorded a 10% improvement in Current Account and Savings Account (CASA), resulting in a CASA ratio of 57.6%, in line with the Bank’s strategy to focus on granular funding. These continued improvements in performances were the main drivers that resulted in net profit after taxes (NPAT) achievement of Rp1.4 trillion in 9M 2021. Furthermore, Danamon also showed improvement in the YoY Cost of Credit (CoC) at 3.8%. Loan at Risk (LAR) ratio improved by 930 bps YoY, while Non-Performing Loans (NPL) ratio declined by 16 bps to 3.1%.

“Despite challenges brought about by social restrictions, particularly in July and August 2021, Danamon recorded continuous improvement in financial performance. The Bank’s collaboration with MUFG network, which has now entered its third year and our focus on blue chip and State-Owned Enterprises customers, has supported growth in loans within our Enterprise Banking and Financial Institution segment. We remain confident that our collaborative initiatives with MUFG will continue to provide a strong foundation for healthy funding and reliable banking services to support business activities that have been limited by social restrictions due to the pandemic,” explained Danamon’s President Director, Yasushi Itagaki.

Initiatives to ensure high-quality, value-added services, as well as seamless banking access to banking customers through steady enhancement of digital services and infrastructure development remain Danamon’s focal point strategies.

In supporting economic recovery, the Bank also maintained initiatives to provide vaccinations to our employees, customers, as well as the general public to support government programs in mitigating the spread of COVID-19 infection. Previously, Danamon held mass vaccinations with MUFG and Adira Finance in Jakarta, as well as participated in the ‘Vaccination Program for the Financial Services’ with Indonesia’s Ministry of Health, National Bank Association (Perbanas), Indonesian Bankers Association (IBI), Indonesia Stock Exchange (IDX), Indonesian Securities Guarantee Clearing House (KPEI) and Indonesian Securities Insurance Agency (KSEI). Danamon continues to hold vaccination initiatives in several traditional market communities in various provinces through the ‘Vaksinasi Gotong Royong’ program, and recently collaborated with PT Kimia Farma Tbk to carry out mutual cooperation vaccinations (Vaksinasi Gotong Royong) for customers.

Growth in Key Segments
Strong collaboration and support from MUFG network and focus on blue chip and State-Owned Enterprises customers continued to yield positive results in the Enterprise Banking segment, which recorded an 8% YoY growth to reach Rp57 trillion throughout 9M2021. Adira Finance’s new financings in the 3rd quarter 2021 has improved by 95% compared to the same period last year.

CASA Growth
Current Account and Savings (CASA) posted a 10% increase YoY to Rp67 trillion from the prior year’s Rp61 trillion. CASA ratio recorded good performance at 57.6% from 51.5% in the same period the previous year due to increased granular current and savings accounts. This strong funding structure builds a solid foundation for future growth.

Maintained Asset Quality Below Regulatory Limits and High Capital
Gross Non-Performing Loans (NPL) at the end of September 2021 was 3.1%, which remains well below the regulatory limit of 5%. NPL improved by 16 basis points compared to the same period in 2020, reflecting Danamon’s continuous efforts to improve asset quality through stringent procedures in risk management, loan collection and recovery. Cost of Credit ratio decreased to 3.8%. At the same time, Danamon’s consolidated Capital Adequacy Ratio reached 26.4%, far above the minimum requirement. The NPL coverage ratio is recorded at 169.7% at the end of September 2021, increased from 142.2% in the same period last year.