Maybank

Indonesia

Bank Internasional Indonesia (BII) operates in 30 of Indonesia’s 34 provinces, supported by 415 branches including 6 Syariah branches and 2 overseas branches; 12 of the new domestic branches are awaiting approval from Bank Indonesia (BI). Our overseas branches are in Mauritius and in Mumbai India in which in the midst of re-activating process. Our subsidiaries, PT Wahana Ottomitra Multiartha Tbk (WOM) and PT BII Finance (BII Finance) have 255 branches combined.

Operating 1,252 ATMs and 65 Cash Deposit Machines (CDMs) nationwide, we are one of few banks that connect to all Indonesian banking networks, namely ATM PRIMA, ATM BERSAMA, ALTO and CIRRUS as well as Malaysia’s MEPS network and Maybank’s ATMs in Malaysia and Singapore.

We offer a full range of financial services for both individual and non-individual clients through retail, SME, and wholesale banking, while our subsidiaries WOM and BII Finance provide motorcycle and car financing respectively.

“In FY2012, we achieved key milestones where total assets exceeded Rp100 trillion and our PATAMI exceeded Rp1 trillion. These outstanding results reflected the continuous improvement of the Bank’s overall performance throughout the year. Our goal is to grow our market share and enhance our position as a key player in the market, in line with our vision to become Indonesia’s leading relationship bank.”

Dato Khairussaleh Ramli
President Director, BII

PT Bank Internasional Indonesia TBK

Financial Performance

BII’s net PATAMI for 2012 surged 81% to a new record of Rp1.2 trillion on the back of solid growth across the Bank’s core businesses, a big rise in deposits, improved asset quality, and continuing operational enhancements.

The Bank also recorded strong loans growth of 20%, with total loans increasing from Rp67.2 trillion to Rp80.9 trillion year-onyear. Total customer deposits climbed 22% to Rp85.9 trillion, against Rp70.3 trillion the year before.

The consolidated loan-to-deposit ratio (LDR) improved from 95.1% in December 2011 to 93% in December 2012. Net interest income jumped 33% from Rp4.0 trillion in FY2011 to Rp5.3 trillion in FY2012. Despite strong competition across the banking industry, BII’s Net Interest Margin (NIM) advanced to 5.73% from 5.22% the previous year, primarily from our greater discipline for funding cost.

Strategy and Objectives

BII‘s strategic statement is “to be the leading relationship bank in Indonesia by truly being in the community, serving through customised products and solutions, and delivering high quality of service”. To this end, we have embarked on a transformation program which we call IMPACT under which we have formulated 28 strategic initiatives that extend to all business and supporting units to be implemented in the next three years. These initiatives are encapsulated under three pillars, namely: Continue to grow profitably, build capability and address fundamentals, and develop talents. We are committed to better recognising the value of our communities and to enhancing our role in supporting community aspirations. Our goal is to ensure that our communities have access to financial services that deliver real and lasting benefits.

During the year, we launched a series of promising regional initiatives with Maybank, and Global Wholesale Banking (GWB) now offers account planning for Indonesian corporate clients. We also implemented Maybank’s best practice risk management, adopted its treasury system, and initiated cross-border assignment of employees.

Achievements

In 2012, we invested heavily in expanding our delivery networks to bring us closer to our communities and improve customer service. We added two regional offices in Puri Kencana, Jakarta and Palembang, Sumatera, opened 64 new branches of which 12 of the new domestic offices are still awaiting BI’s approval, and we added 165 ATMs throughout Indonesia. We also launched the country’s first paperless account-opening system, and – in partnership with Maybank – introduced new supply chain business and wealth management products. Our supply chain model has been recognised as the model to be adopted across the Group.

In October 2012, we successfully executed a bonds issue consisting of Rp2 trillion in bonds and Rp1 trillion in sub debt, to provide long-term funding, strengthen our capital base and support our future business growth.

BII won an impressive array of awards during the year:

• The Best Bank in Service Quality 2011 from The Institute of Service Management Studies (ISMS)
• Best Corporate Governance Financial Sector 2012 at the fourth Indonesian Institute for Corporate Directorship (IICD) Conference and Award
• The Best Bank in Handling ATM Claims from ATM PRIMA Network
• Indonesia Banking Loyalty Product (IBLA) for credit card product from MarkPlus Insight and Infobank
• The Best in Class Straight-Thru Processing (STP) Rates from Bank of New York, Mellon, JP Morgan and Citibank
• The Call Centre Service Excellence Award 2012 from Care Centre for Customer Satisfaction and Loyalty (CCSL)
• The Third Best in Bank Service Excellence Award 2012 from Marketing Research Indonesia and Infobank
• ‘Apresiasi Simbol Kebangkitan Bangsa’ for Women One savings product from Seputar Indonesia daily news
• 2nd Best in Human Capital, Compliance, Corporate Social Responsibility and Marketing for Bank with assets category Rp25-Rp100 trillion at Anugerah Perbankan Indonesia 2012 by Perbanas Institute and Business Review

Outlook

BII operates in ASEAN’s largest market economy with an annual GDP growth of over 6% and a GDP value of more than USD1 trillion. The market is driven primarily by foreign and domestic investment, and consumption, and with rising affluence, 50 million people are expected to form the new middle class population. The loan to GDP penetration is at about 30%, signalling a huge potential for the banking industry. By 2030, Indonesia is projected to become the seventh largest economy in the world.

Despite the Eurozone debt crisis and the economic slowdown in the US, China, India and other emerging markets, Indonesia's economy is still slated for strong growth. Inflation stayed at a manageable 4.30% in 2012, only slightly higher than 2011’s 3.56%. In response to the weak global economy and to support domestic growth, the central bank cut its benchmark interest rate by 25bps from 6.00% in 2011 to 5.75% in 2012. The higher trade deficit and the current account deficit has had an impact on the Rupiah, though strong foreign investment has mitigated this.

All in all, with the domestic economic outlook remaining positive at the stage of development of the financial services industry, BII is poised for further growth. Hand-in-hand with Maybank, in 2013 we will work hard to realise the Group’s regional aspirations.