KUALA LUMPUR (July 29): Maybank Group's PT Bank Maybank Indonesia reported a 30% increase in profit after tax and minority interests (PATAMI) of 663 billion rupiah (about RM198.57 million) for the first half of the year ended June 30 (1HFY22) from 510 billion rupiah in the previous year, as loan demand grew while the economy improved.

In a statement on Friday (July 29), Maybank Indonesia said the better results were also due to reduced loan provisions amid improved loan quality, supported by loan growth, lower cost of funds and well-maintained overheads.

“The bank’s net interest income (NII) stood at 3.48 trillion rupiah, backed by growth in retail and corporate loans, lower cost of funds, and strong growth in CASA, resulting in the bank’s net interest margin (NIM) expanding 18 bps (basis points) to 4.6% in 1HFY22.

“Following the improvements in the overall economic outlook, the bank saw a decrease in provisions for impairment losses by 32.6% to 534 billion rupiah, resulting from the bank's continued success in its restructuring efforts in particular, for customers’ loans impacted by the pandemic.

“These efforts have resulted in improved bank's consolidated non-performing loan (NPL) ratio, which stood at 3.5% (gross) and 2.6% (net) in June 2022 from 4.4% (gross) and 2.7% (net) in June 2021 and a decrease in NPL balance by 12.5%. The bank maintained a prudent banking approach and continued to apply a conservative risk posture,” it said.

Maybank Indonesia also noted that its capital position remains strong, with capital adequacy ratio (CAR) standing at 25.9% in June 2022, compared with 26.3% in June 2021. The bank's total capital also increased to 28.21 trillion rupiah in June 2022 from 27.16 trillion rupiah in June 2021.

Meanwhile, its digital banking platform M2U reported around 8.6 million transactions in 1HFY22, 18.6% more than a year ago, with transaction value rising 23.7% to 44.95 trillion rupiah, as customer acquisition surged six times.

On its M2E platform, transactions jumped 42.7% to over two million in 1HFY22 from a year ago, with total value growing by 42.9% to 348.18 trillion rupiah. Active users rose by 14.5% to 2,827 users during the same period. "This led to a growth in corporate funding through M2E by 1.4% to 24.36 trillion," it said.

Maybank Indonesia Shariah banking unit's operating profit before provision rose 11.1% to 382 billion rupiah as financing grew 5.3% to 26.04 trillion rupiah, while CASA grew significantly by 43.7% to 11.91 trillion rupiah, lowering cost of funds.

"Total Shariah banking unit’s assets grew 13.2% to 41.14 trillion rupiah from 36.35 trillion rupiah, accounting for 26.2% of the bank’s individual assets. Non-performing financing (NPF) ratio improved at 2.9% (gross) and 2.3% (net) in June 2022 from 3.8% (gross) and 2.6% (net) in June 2021 as total Shariah financing grew. Financing-to-deposit ratio (FDR) stood at a healthy level of 82.0%.

"The Shariah banking unit continued to take conservative measures to safeguard its asset quality by setting aside higher provisioning for specific accounts, which led to a drop in profit before tax to 124 billion rupiah in the first half of 2022 from 294 billion rupiah in the previous year,” it said.

Maybank Indonesia president director Taswin Zakaria said it will continue with its strategies and initiatives in ensuring sustained growth in its loan portfolios.

“Given the uncertainties arising from geopolitical and recent market conditions, we will remain prudent in managing our business, and emplace necessary precautions to safeguard our assets, as well as maintain risk posture to withstand any unforeseen global threats.

“At the same time, we will focus on sustainable businesses by taking into account the environmental, social and governance aspects in every course of our business, in line with the bank's mission, humanising financial services,” Taswin shared.

Maybank group chief executive officer and president Datuk Khairussaleh Ramli said Maybank Indonesia has delivered a commendable performance in 1HFY22 despite the market volatility seen globally.

“The bank was able to capture business opportunities across its various segments and drive growth as economic momentum started to return in 2022.

“Backed by strong fundamentals and supported by effective risk management, I am confident that Maybank Indonesia will be able to navigate through potential market volatilities it may experience in the coming quarters," Khairussaleh said.

At the time of writing, Maybank shares were unchanged at RM8.85, giving it a market capitalisation of RM105.93 billion.