Bank NISP sees 25% net profit rise<\/p>\n
SINGAPORE (Reuter): Publicly listed Bank NISP said yesterday
\nit expected to boost its net profit at least a quarter this year
\nby moving into a range of new products.<\/p>\n
President and chief executive officer Pramukti Surjaudaja said
\nNISP, one of the smallest but best-rated of Indonesia's private
\nbanks, was gradually moving out of its traditional retail base
\ninto commercial and fee-based operations.<\/p>\n
In 1996, the bank made a net profit of Rp 19.3 billion
\n(US$6.66 million) and had a net interest income of Rp 54.40
\nbillion. Of its total income, roughly 10 percent came from fee-
\nbased activities, he said.<\/p>\n
\"This year we plan to increase our net income by at least 25
\npercent and we feel it may be above this because if you look at
\nour track record in the past, we have been building at level,\"
\nPramukti told Reuters in an interview.<\/p>\n
He was in Singapore for a briefing for clients.<\/p>\n
\"That will come mostly from the retail and commercial
\nbusinesses. Our prime market is the middle market. Our average of
\nloan is only about 100 million rupiah and an average deposit is
\nfour million,\" he said.<\/p>\n
Formed in 1941 under the Dutch colonial administration as NV
\nNederlandsch Indische Spaar en Deposito Bank, NISP was floated on
\nthe Jakarta stock exchange in 1994.<\/p>\n
It is Indonesia's 30th biggest private bank in terms of assets
\nbut has been ranked between fourth and sixth for credit by
\nvarious independent agencies over the last three months.<\/p>\n
Its loan-to-deposit ratio is now 72.9 percent, one of the
\nhighest among Indonesian banks.<\/p>\n
More than 80 percent of its business is still pure retail from
\ninterest income but Pramukti said this was gradually changing as
\nits commercial activities grew.<\/p>\n
\"In terms of sectors, we are already very well spread with the
\nservice industries (accounting for) some 25 percent,
\nmanufacturing about 25 percent and trading about 25-30 percent.\"<\/p>\n
\"Fee-based income now accounts for only about 12 percent of
\ntotal income. But that has to rise because we believe in the
\nfuture (retail) pricing will be very tough,\" he said.<\/p>\n
\"We expect it (fee-based income) to rise by about 30 to 40
\npercent...towards 15-20 percent of total income,\" he said,
\nwithout giving a time frame.<\/p>\n
Pramukti said the bank was expanding into new products for its
\nretail clients such as insurance, which it was doing in
\npartnership with German insurance giant Allianz Life.<\/p>\n
\"This is a captive market. If people want to borrow some money
\nand they want to be insured, we sell them these products.<\/p>\n
\"We are also studying custodian services and of course LC
\n(letters of credit) business,\" he said.<\/p>\n
He said the bank aimed to maintain its high ratings.<\/p>\n
\"The biggest is not necessarily the best. But we would aim to
\nbe maybe in the top 15 banks,\" he said.<\/p>\n
He said turbulence in Asian currency markets, in which the
\nrupiah plunged to a low of 3,045 to the U.S. dollar from 2,360 at
\nthe beginning of the year, had not yet affected the bank.<\/p>\n
\"Up to now it hasn't been significant but if the conditions
\ncontinue as they are now for a few months more, then we will be
\naffected,\" he said. But there would be no profit downgrade.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bank-nisp-sees-25-net-profit-rise-1447893297",
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