Bank Tabungan Negara held its analyst meeting last Friday to report first quarter 2010 result. The bank’s bottom line increase 71.70% YoY because of lower Cost Of Fund. On the other hand, gain in bonds trading increased their other operating income as well. So, its net interest margin and operational income increased by 68.85% and 75.16% respectively. Better liquidity environment as well as lower interest rate environment and increasing low income mortgages from infrastructure project will give BTN benefit to grow faster in 2010. However, unsolvable NPLs problem and changing government policy will be the main risk for the bank’s future growth.
Higher NPL In 1Q10
Despite having good profitability result, BTN still experienced higher NPLs in 1Q10. Its NPL increased from 3.35% in 4Q09 to 4% in 1Q10, which mainly came from its subsidized mortgages loan, non-subsidized mortgages and consumer loan. The management said that its key performance indicator (KPI) for branch manager which appraised yearly made NPLs in the branch level higher in the first 3rd quarter. So, the management has started to move KPI for solving NPLs from yearly to monthly basis. Except for construction loan and commercial loan, we are not worrying about since BTN has had the expertise at mortgages lending since couple decade ago. We believe that its subsidized mortgages NPLs will recover in 2Q10 because of better economic environment.
Change In Government Subsidy Policy
Before 2010 Government Budget, the government gives a direct interest subsidy for each low income BTN customer. Starting 2010, the government are no longer giving direct subsidy but providing a low cost fund (proximately at 1% interest rate p.a.) around Rp. 3.5 trillion,while the rest of funds (approximately 28%) are provided by BTN. According to the management, the new policy give BTN more benefit than before since it provide BTN additional funds, that BTN really need to. The management also said that they currently are requesting higher low cost funds to the government that will enable them disbursing more subsidized mortgages this year.
Blessing from infrastructure project kick off?
Given relatively stable politic environment and a bunch of liquidity for long term off shore funding, several of infrastructure project which previously has been delayed because of political uncertainty and liquidity tightening are starting to kick off. We believe that infrastructure project will increase economic activity in the town or city and finally attract villagers to come to the town and increase urbanization rate. As the result, demand for lower income housing as well as its financing services. So it will be benefited BTN since the bank has more than 98% market share at low income housing mortgages.
Tidak ada komentar:
Posting Komentar