BCA may raise lending to Rp 9t this year
BCA may raise lending to Rp 9t this year
Leony Aurora, The Jakarta Post, Jakarta
Bank Central Asia (BCA), the country's third largest bank in
terms of assets, said on Thursday it would channel up to Rp 9
trillion (US$1.07 billion) in lending this year, up from about Rp
7.5 trillion in 2003.
BCA vice president director Aswin Wirjadi said the bank was
optimistic the lending expansion would not be interrupted by the
2004 legislative elections, because the real sector still needed
fresh funds to run and expand their businesses.
He also said the bank would channel its lending equally to the
corporate, retail and consumer sectors.
BCA is aggressively working to boost its revenue by expanding
its lending in order to help compensate for a revenue decline
from its interest proceeds from recapitalization bonds.
The central bank has been aggressively cutting its benchmark
rate to a current level of 8.24 percent, far below the 13 percent
at the end of 2002.
The decline has had a heavy impact on BCA because its recap
bonds mostly consist of variable net bonds carrying floating
rates linked to the central bank's interest rate. When the
central bank's interest rate declines, BCA's revenue from recap
bonds also declines.
About 95 percent of BCA's total recap bonds, currently worth
about Rp 37 trillion, carry a floating rate, which makes them
extremely sensitive to fluctuations in the benchmark rate.
Because of this, Aswin said, BCA plans to unload about Rp 10
trillion of its recap bonds this year.
BCA's consumer banking general manager, Stephen Liestyo, said
BCA was targeting 100,000 new customers for its mobile banking
service and 400,000 transactions valued at Rp 500 billion
(US$58.82 million) per month in 2004.
"Our target is to double last year's transaction value,"
Stephen said.
Thus far, there are about 65,000 regular users of the BCA
mobile banking service.
BCA and cellular operator Excelcom, or ProXL, started the
mobile banking service three years ago using a special SIM-card
containing a program that enables users to perform various
banking transactions, such as transferring funds, paying bills
and checking balances.
In the past, customers had to register with a Pro-XL office in
order to use this service. However, customers no longer need to
do this since BCA and Pro-XL launched a new service called Life
In Hand, which, among other things, allows customers to register
for mobile banking through their cellular phones.
The transaction charges for the new service have also been cut
by 50 percent to between Rp 500 and Rp 1,000 per transaction.
BCA also works with Satelindo to provide mobile banking and in
three months will launch a similar service with Telkomsel.