PT BTPN Syariah Tbk.: Serving the unbanked segment, profitably - - PowerPoint PPT Presentation

PT BTPN Syariah Tbk.: Serving the unbanked segment, profitably

Performance as of 1H’2019

BTPN Syariah : Focus on serving productive underprivileged women

4 key behaviors Courage Discipline Hard work Solidarity

5 years financial package Membership system #bankir pemberdaya

Funding Financing

4 key behaviours Courage Discipline Hard work Service Excellence Optimum Return Sustainable Excellent Performance

A more meaningful life

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Distribution Network:

# of branches: 66 (inc. 12 funding branches) # of wisma : ~1.800

BTPN Syariah Overview

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• Established in 2010 as BTPN Sharia Unit;

massive roll-out in 2011

• Spin-off as PT BTPN Syariah on 14 July 2014
• Listed as PT BTPN Syariah Tbk on 8 May 2018

IPO price: 975, market price 52w range 1,580 to 3,450

• Today: Spread across 23 provinces, with 11,545

employees (~90% female and ~45% high school graduates) Customers

Serving  5.0 mn customers,  3.6 mn active

Coverage

200k communities, in  2,600 sub-districts

Assets

13.9 trillion

NPF

1.3%

ROE

29.8%

ROA

12.8%

Awards

Cambridge IFA - Global Good Governance Award for Financial Inclusion and Customer Care, 11 other awards in 1H’19

1H’19 Performance

Rating

AA+ (idn) Fitch (Stable Outlook)

Serving Sumatera, Java, NT, Kalimantan and Sulawesi Our journey

Padang Pekanbaru Palembang Lampung Jakarta Bandung Semarang Yogya Surabaya Mataram Banjarmasin Makasar Pontianak Samarinda Palangkaraya Kendari Denpasar Banda Aceh Medan Jambi

Sumatera Kalimantan Sulawesi Java Nusa Tenggara

Kupang

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Going forward Performance track record Unique value proposition Target market Contents

23 million productive poor women in Indonesia

Target market Our customers

Their needs Self-employed Their work

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Productive Poor Daily expenditure < $2  45 mn in Indonesia,

• f which 23 mn female

 78% reside in Java & Sumatera

Large / Medium Enterprises SME Micro

Sell goods Produce Raise livestock Education for children Daily basic needs Improve living conditions

Source: Statistics Bureau, team analysis

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Going forward Performance track record Unique value proposition Target market Contents

Unique Value Proposition

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• Primarily for productive purposes
• Program in one package:

 Loan: 25 bi-weekly installments  Insurance: free life insurance  Saving: no monthly fee or minimum balance requirement

• 5 cycles financing programs

 Max 100% limit increase after completion of each cycle  Loans for housing renovation/ education in Cycles 3-5

Our people as:

• the role model of

 Honesty  Politeness  Discipline

• Daya facilitators

Free Daya Programs:

• Daya Sehat Sejahtera

(Health & Wellness)

• Daya Tumbuh Usaha

(Entrepreneurial Capacity Building)

• Daya Tumbuh Komunitas

(Community Empowerment)

• Groups of 5, selected by group

members

• Bi-weekly formal meeting
• Mandatory saving
• Shared responsibility

4 key behaviours Courage Discipline Hard work Solidarity

5 years financial package membership system

• ur people

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Going forward Performance track record Unique value proposition Target market Contents

Management team and shareholder’s composition

Kemal Stamboel

President Commissioner

• M. Sc., Hult International, USA
• Managing Partner PwC (1982 – 2002)
• Secretary General – Foreign Bank

Association of Indonesia

• Mahdi Syahbuddin, Operation & HC professional
• f 31 years
• Maya Kartika, HC professional of 28 years
• Dewie Pelitawati, Legal and compliance

professional of 33 years

Board of Commissioners

Board of Directors

24 years in banking, 13 years of experience developing business models for mass market

• Finance, business

planning, business (BTPN, Danamon, Universal)

• MBA, Melbourne

Business School 26 years in banking, 19 years of experience in infrastructure and

• perations
• Operation &

infrastructure (BTPN, Danamon, Citibank, Universal)

• Engineering,

Universitas Indonesia 21 years in banking, 19 years of experience in risk management

• Retail risk management

(BTPN, Danamon, Citibank)

• MBA, Tulane

University, USA 27 years in banking, 21 years of experience in consumer risk

• Consumer risk (HSBC,

ABN Amro, Danamon, GE, Citibank)

• Engineering, Institut

Teknologi Bandung 21 years in banking, 19 years of experience in business and operations

• Business,Human capital

& operation (BSPD, Permata, Universal, Asuransi Astra Buana)

• Engineering, Institut

Teknologi Bandung

Board of Directors

Ratih Rachmawaty

President Director

Mulia Salim

Vice-President Director

• H. Ikhwan Abidin, MA

Head of DPS

• M. Sc., Islamic Economics, Pakistan
• Member of Sharia Board Indonesia
• H. Muhammad Faiz, MA, Member of NU,

M.Sc., University of Cairo.

Shareholder composition Sharia Supervisory Board (“DPS”)

8

Taras Siregar

Business 1 Director

Arief Ismail

Compliance and Risk Director

• M. Gatot A.

Prasetyo

Business 2 Director

PT Bank Tabungan Pensiunan Nasional Tbk. Public

As of 30 June 2019

Proven execution capability as reflected in transformational growth

Centers Financing Customers Funding Assets Equity

~ 200,000 2,361 2011 1H’19 ~ 3,600,000 37,015 2011 1H‘19

 97x

13,942 104* 2011 1H’19 8,544 62 2011 1H’19 8,884 110 2011 1H’19 4,601 824** 2014 1H’19

IDR billion IDR billion IDR billion IDR billion

 85x  134x  138x  81x 6x

9 * Adjusted assets (without legacy portfolio) **after spin-off as a Bank

Financing & Customer deposits growth

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Financing Customers by Cycle (Jun’19) Cost of funds Customer deposits

IDR billion %

Commercial Banks May’19 YoY: 11.1%

IDR billion

Cycle 1 32% Cycle 2 25% Cycle 3 17% Cycle 4 & above 26%

5,770 6,053 6,873 7,277 8,544

Jun' 17 Dec'17 Jun' 18 Dec'18 Jun'19

6.2% 6.0% 6.0% 5.8% 5.5% 5.1% 5.1% 5.7% 6.3% 6.3%

Mar '17 Jun '17 Sep '17 Dec '17 Mar '18 Jun'18 Sep'18 Dec '18 Mar '19 Jun '19

20% 21% 21% 23% 20%

80% 79% 79% 77% 80%

Jun'17 Dec'17 Jun'18 Dec'18 Jun'19

CASA TD 7,021 5,959 6,546 7,612

Number of Customers: ~ 3.6 mio

YoY 24%

Commercial Banks May’19 YoY: 6.3%

YoY 27% 8,884

Financial scorecard – maintain strong performance

Jun’18 Dec’18 Mar’19 Jun’19 ∆QoQ ∆YoY

Cash & Liquid asset 3,487 4,404 4,661 5,003 7% 43% Financing (gross) 6,873 7,277 7,507 8,544 14% 24% Allowance for losses (181) (216) (235) (255) 9% 41% Deposits / funding 7,021 7,612 7,817 8,884 14% 27% Total Liabilities 7,283 8,042 8,255 9,341 13% 28% Equity 3,444 3,997 4,283 4,601 7% 34% Total Assets 10,727 12,039 12,538 13,942 11% 30%

Balance sheet, IDR billion Income statement, IDR billion

1H’18 FY’18 1Q’19 2Q’19 1H’19 ∆QoQ ∆YoY

Margin income 1,623 3,447 973 1,077 2,049 11% 26% Margin expense 171 368 115 127 243 10% 42% Operating income 1,452 3,080 857 949 1,807 11% 24% Operating expense 729 1,525 406 448 854 10% 17% Loan loss provision 125 265 65 76 142 17% 14% Profit After Tax 449 965 288 321 610 11% 36%

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Key ratios (%)

* loss provision coverage 4Q’18, 1Q’19 and 2Q’19 excl. recent disasters (Sunda Strait & Lombok) 166%, 159% and 169% respectivelly

RoA RoE CAR NPF Gross/Net CoC 1Q’19 H1’19 Cost to Income 1Q’19 H1’18 FY’18 2Q’19 1Q’19 1Q’19 2Q’18 H1’19 1Q’19 1Q’19 2Q’19 49 12.7 28.7 39.3 3.6 3.7 39.4 39.4 12.7 12.8 29.8 29.3 47 47 H1’18 FY’18 50 12.4 12.5 H1’18 FY’18 33.9 30.8 H1’18 FY’18 36.9 40.9 H1’18 FY’18 H1’18 FY’18 4.0 4.0 2Q’19 H1’19 2Q’19 H1’19 2Q’19 H1’19 1.38 0.17 1.34 0.14 1.34 0.14 1.65 0.01 1.39 0.02 3.7 47 H1’19 Loss provision coverage 2Q’18 1H’19 1Q’18 227 223 223 1H’18 FY’18 158 214

Manageable portfolio risk and improving quality

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• Prospective customer has to

prove their commitment :

– 5 days membership basic

training

– After financing being

disbursed, strong monitoring mechanism through mandatory regular meeting

• Joint responsibility as the

primary building block

– Each member could flag

any defect regarding another member business to prevent further deterioration in the payment

Unique credit risk culture

NPF Trends

Unique portfolio mix

Portfolio Distribution Maturity Composition* Financing Composition* Ticket Size*

1 year 74% 26% 1- 2 year ≤ 5mn 57% > 5mn Repeated Cust 86% 14% New to Bank

3.6 mn customer in 200 K Communities

0.20% 0.20% 0.01% 0.01% 0.05% 0.02% 0.01% 0.03% 0.02% 0.17% 0.14% 1.53% 1.74% 1.70% 1.66% 1.67% 1.67% 1.65% 1.56% 1.39% 1.38% 1.34%

Dec 16 Mar 17 Jun 17 Sep 17 Dec 17 Mar 18 Jun 18 Sep 18 Dec 18 Mar 19 Jun 19

NPF-Net NPF-Gross

43% *based on outstanding

Good Risk & Compliance

• 1. Risk Based Bank Rating

2 (Good)* 2 (Good)*

• 2. Good Corporate Governance

: :

• 3. Ratings

Upgrade to AA+ (idn) “Stable” (based on Fitch as per Feb 19) :

• 4. Capital

CAR 39.4% :

*based on self assessment, as of Q2 2019

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1Q’19 Performance comparison to other Sharia banks

NPAT & assets size

NPAT in IDR Billions Assets Size (x assets relative to BTPN Syariah) 181 2 135 30 71 288 5 12 12 7 1 2 23 7.9 4.4 3.5 3.1 1.8 1.0 0.7 0.6 0.6 0.5 0.5 0.1 0.1

Mandiri Syariah Muamalat BNI Syariah BRI Syariah Bank Aceh BTPN Syariah Panin Syariah Mega Syariah BCA Syariah BJB Syariah Bukopin Victoria Syariah Maybank Syariah

99 tn 55 tn 44 tn 39 tn 23 tn 12.5 tn 8 tn 7 tn 7 tn 7 tn 7 tn 2 tn 1 tn

*Source: 1Q‘19 publications

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Social impact scorecard (1H’19): Positive Changes, Better for Community

Do all household members aged 6-18 years go to school? What type of toilet arrangement does the household have? What is the main cooking fuel?

15 % No, they don’t % None or latrine % Firewood, charcoal,

• r coal

#2 #6 #7

Probability of falling back to “below the poverty line” ($3.1/day) Cycle 2 Cycle 1 Cycle 3 27.6% 23.0% 25.2%

12.0% 16.9% Cycle 1 Cycle 2 Cycle 3 5.7% 8.0% 10.4% Cycle 1 Cycle 2 Cycle 3 10.7% 14.0% 16.8% Cycle 1 Cycle 2 Cycle 3 13.4% PPI (Poverty Probability Index) was built by IPA(Innovations for Poverty Action ) to measure the progress out of poverty . www.progressoutofpoverty.org/

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Performance track record Going forward Unique value proposition Target market Contents

Capturing the potential in the ecosystem

b ~3.6 million current customers ~1.4 million drop-off customers a Continue to acquire new customers Customers’ families c Expand, e.g. Institutional (leverage BTPN), micro-SMEs around core customers ~12 million members of customers’ families Digital transactions Airtime top up, utilities, etc. E-commerce Groceries, lifestyle Business opportunities Agents/referral Learning/insights Business, education, religion Fashion Financial solutions Loans, savings, insurance

OBJECTIVE & AGENDA

• Direct access to ~5.0

million families

• Presence in ~200k

villages

• ~7,000 biweekly

scheduled direct face-to- face interactions by field staff

• Thousands of branchless

banking agents

• Insights and information
• n customer loan

payment track record Leveraging our unique assets… …to deepen and expand our engagement… …to service their needs

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Lead product

Deepen engagement with existing customers

Update on BTPN Syariah initiatives on improving efficiency and creating strategic advantage through digitization of the ecosystem

Towards a paperless environment… …and a less cash environment enables digital

financial transactions of

• ur customers through

agent banking

is a tablet-based

solution to digitize the field staff, and move away from paper-intensive processes.

Payments & Transactions Financing Protection E-commerce Saving Capacity building

Status as of 30 Jun 2019:

• Roll out front-end system and continuously complete
• ther supporting apps for field staff to serve customer
• > 10,500 field staffs have used the tablets to aim daily

productivity increase from 2-3 meetings to 3-4 meetings

• Optimizing number of office from 122 to 41.

Status as of 30 Jun 2019:

• Completed the development of agent’s new front-end

system (Face Recognition and QR code),

• Continue piloting in 5 Areas

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End of Document