sustainable business growth, providing services to customers to raise CASA, increase fee based income, improve customer experience, as well as create efficiency, generate investment in electronic channels, and focus on the sharia segment.
Business Segment Review
Mortgages increased by 12.0%
yoy to Rp27.0 trillion
12.0%
92%
several consultants, CIMB Niaga measured the level of customer satisfaction through several research methodologies ranging from mystery shopping to providing in-depth questionnaires to customers related to CIMB Niaga’s services.
CIMB Niaga strives to improve efficiency without compromising service quality for its customers. This matter is realized in part through optimizing the number of branches and simultaneously increasing investments in other sectors, especially through investment in electronic channels. This strategy was approached through observing and adapting to customer behavior trends, which tend to reflect the desire to have easier transaction processes in real time through mobile banking and internet banking.
Another strategic policy in Consumer Banking is focus on Syariah First from CASA, mortgages, credit cards, and other sharia banking products. This strategy was able to increase the pre-tax profit of Sharia Consumer Banking by 125.4% compared to the previous year. In 2017, CIMB Niaga succeeded in registering 49,855 Hajj pilgrimage accounts, a significant increase compared to the 17,609 accounts in 2016. Sharia home financing also experienced rapid growth, increasing 103.1%
compared to the previous year.
PERFORMANCE IN 2017
Consumer Loans Segment
In 2017, Consumer Banking (including subsidiary) recorded a 6.7% decline in loans, or a decline of Rp3.5 trillion to Rp48.6 trillion compared to Rp52.1 trillion
decline in auto loans, or a decline of Rp6.1 trillion to Rp8.7 trillion, compared to Rp14.8 trillion in 2016. Other consumer credit sectors experienced higher growth such as mortgages and personal loans (KTA). Meanwhile, the non-performing loans ratio improved to 2.5% from 2.7% in 2016.
Loans (Rp trillion)
53.3 52.1
48.6
17 16
15
NPL Gross %
2.7% 2.5%
2.1%
17 16
15
Description
(Rp billion) 2015 2016 2017 Growth (%)
2015-2016 2016-2017
Mortgages 23,465 24,110 26,996 2.7 12.0
Auto Loans 18,750 14,807 8,721 (21.0) (41.1)
Credit Cards 6,368 8,244 8,149 29.5 (1.1)
Personal Loans 2,630 3,347 3,582 27.3 7.0
Multipurpose and others 2,074 1,622 1,191 (21.8) (26.6)
Total 53,287 52,130 48,639 (2.2) (6.7)
CONSUMER BANKING
Customer Deposits
In 2017, total customer deposits of Consumer Banking grew by 2.3%, or Rp2.2 trillion to Rp96.0 trillion compared to Rp93.8 trillion in 2016. The increase in customer deposits was mainly driven by growth in CASA by 5.3%, aligned with Banks focus to grow CASA. Customer deposits were mainly contributed from savings products by 5.0%, or Rp2.3 trillion to Rp47.3 trillion from Rp45.1 trillion in 2016, followed by the growth of demand deposits to Rp2.4 trillion compared to Rp2.1 trillion in the previous year. This customer deposits growth was achieved through the innovations of various saving products, and cross- selling products to customers.
Customer Deposits (Rp trillion)
90.3 93.8 96.0
17 16
15
Consumer Banking Income
In 2017, Consumer Banking (including subsidiary) recorded a decline in profit before tax of Rp2.1 trillion, decreasing by 15.4%, or Rp379 billion compared to Rp2.5 trillion in 2016. Net Interest Income (NII) of Consumer Banking increased by 1.6% to Rp5.35 trillion from Rp5.27 trillion in 2016. CIMB Niaga, including Consumer Banking, is more selective in determining the loan quality, and took proactive steps to maintain portfolio strength.
4,583
5,269 5,352
2,082 2,461
1,830
17 16
15
Net Interest Income (Rp billion) Profit Before Tax (Rp billion)
CONSUMER BANKING’S OPERATIONAL PERFORMANCE BY SEGMENTS
Mortgage Loans
In the midst of tight competition, CIMB Niaga is now recognized as one of the five largest mortgage loan providers in Indonesia. This position was attained through strategies and initiatives focused on introducing innovations to gain more customers.
Within mortgages, CIMB Niaga offered innovative and competitive products to fulfill customer needs. One of these products is KPR Xtra Manfaat, which has the benefit that a savings balance can decrease the loan interest instalment portion and so facilitate a larger portion of principal to be paid, allowing customers to finish the loan period in a shorter time. As an additional interesting feature, KPR Xtra Manfaat can be linked to up to 9 saving accounts. Conversely, CIMB Niaga also offered new features for KPR Sharia with a MMQ akad (contract), popularly known as KPR iB Flexi, which
BERNARD SALEH Professional Photographer
I have been a customer of CIMB Niaga since 2012. At that time, I needed to open bank accounts for my employees who lived all across Jakarta. After researching, I found out that CIMB Niaga’s Digital Lounge allows me to conduct account openings with straight- forward documents, and moreover, the operating hours of the Digital Lounge are quite flexible and open at most of the malls across Jakarta.
This is super easy for my employees to go and open their accounts.
Go Mobile and CIMB Clicks are my go to channel for all of my banking transactions, mostly for salary payments, bill payments or transfers. I like the new Go Mobile, the interface of the new Go Mobile is very user friendly. In the future, I hope CIMB Clicks got upgraded just like Go Mobile. All the best to CIMB Niaga.
CIMB Niaga also complements its mortgage products with a variety of attractive and competitive pricing options. One of the options is the Smart Rate Pricing scheme that allows customers to have clear reference in the determination of the floating interest rate from the earliest loan stage y using the 7 Day Reverse Repo Rate as reference, which can be accessed directly through the Bank Indonesia website.
In enhancing the brand awareness of mortgage loans, CIMB Niaga organizes a variety of promotional activities, through CIMB Niaga promotional events or in collaboration with leading and long-time developer partners. Such events feature the exhibition of house products and flagship mortgage services with low interest rates. Several exclusive promotions with leading developers have also been launched to provide more benefits for CIMB Niaga’s mortgage customers.
In addition throughout 2017, CIMB Niaga continued to harmonize relationships with developers, maintaining interest rates in order to remain competitive, and increasing the speed of mortgage processing and extending loan tenure to 25 years, to attract first-time mortgage customers.
In 2017, CIMB Niaga successfully booked a mortgage portfolio growth of 12.0% to Rp27.0 trillion, from Rp24.1 trillion in 2016. The ratio of non-performing loans was still at 2.5%, equal to 2016. In addition, CIMB Niaga achieved excellent growth of sharia home financing by 103.1%, reaching Rp5.4 trillion, compared to Rp2.7 trillion in 2016.
CIMB Niaga’s mortgage businesses also earned an award from an independent party, by receiving an award from Housing Estate Awards 2017 for being
”Most Innovative Bank on Mortgage Products”.