BRI Micro & SME Index Launching: BRI is Optimistic that MSMEs Will be Revived
JAKARTA, Indonesia, Nov. 12, 2020 /PRNewswire/ -- PT. Bank Rakyat Indonesia (Persero) Tbk (BBRI) is optimistic that in the future the economy will improve, mainly because Micro, Small and Medium Enterprises (MSMEs) have started to revive. This was conveyed by the President Director of BRI Sunarso in a virtual presentation of BRI's performance in the third quarter of 2020 in Jakarta (11/11).
This optimism is based on the results of the BRI-MSME Business Activity Survey in the third quarter of 2020, which indicated that MSME business activities are starting to be active and had higher optimism for improvement in the fourth quarter of 2020. The survey results show the BRI Micro & SME Index (BMSI) rose from 65.5 to 84.2 in the third quarter of 2020 and is projected to increase to 109.3 for the fourth quarter of 2020.
BMSI is an index that assesses MSME for their activities, consisting of the Business Activity Index (Indeks Aktivitas Bisnis/IAB) to see the current situation and the Business Activity Expectation Index (Indeks Ekspektasi Aktivitas Bisnis/IEAB) which measures expectations for the next 3 months.
"We launched this index today to be used to measure MSME business activities and we created it as a form of BRI's concern for Indonesia's MSME activities and will become one of the first leading indicators in Indonesia to measure MSME activity. In the future, BMSI will be published regularly every quarter so that it can become one of the considerations for public policy," explained Sunarso.
The growing activity of MSMEs had a positive impact on BRI's performance until the end of the third quarter of 2020. Amidst the ongoing pandemic and efforts to save MSMEs and the implementation of National Economic Recovery (Pemulihan Ekonomi Nasional/PEN), until the end of September 2020 BRI was still able to record positive credit and savings growth, better than the national banking industry.
In terms of performance, until the end of the third quarter of 2020, on a consolidated basis, BRI Bank had disbursed loans amounting to IDR 935.35 trillion or growth by 4.86 percent compared to the same period last year of IDR 891.97 trillion. This is higher than industrial credit growth of 0.12 percent (based on OJK data for September 2020).
The composition of BRI's MSME loans compared to BRI's total loans also grew significantly from 78.10 percent in the third quarter of 2019 to 80.65 percent in the third quarter of 2020. This is a milestone for the company, where for the first time BRI was able to reach an MSME loan portion of 80 percent. "We are targeting this milestone to be achieved in 2022 and BRI is able to respond to these challenges faster," he said.
BRI has also massively restructured its loans, with the aim of helping MSMEs to survive. As of September 30, 2020, BRI has restructured loans worth IDR 193.7 trillion to 2.95 million debtors.
"The continuous restructuring combined with healthy and selective lending was able to keep BRI's NPL at 3.12 percent with NPL Coverage of 203.47 percent at the end of September 2020. BRI's NPL was recorded below the NPL of the banking industry in September 2020 at 3.15 percent," he said.
Until the end of the third quarter of 2020, BRI's Third Party Fund liabilities (Dana Pihak Ketiga/DPK) was recorded at IDR 1,131.93 trillion, an increase of 18 percent YoY. This figure is above the national banking industry average in September 2020 of 12.88 percent. Low-cost funds (CASA) still dominate BRI's savings portfolio, reaching 59.02 percent of total DPK or IDR 668.10 trillion.
The strategy that the company has implemented to continue to grow healthily and selectively amidst a pandemic combined with the distribution of the PEN program has yielded positive results. Until the end of September 2020, the company was able to record a consolidated profit of IDR 14.15 trillion with consolidated assets reaching IDR 1,447.85 trillion or a growth of 10.89% YoY.
BRI is also able to maintain an ideal loan to deposit ratio (LDR) at 82.63 percent, or lower than BRI's LDR at the end of September 2019 at 92.99 percent. This reduction in LDR opened room for BRI to further reduce the Cost of Fund (COF). Meanwhile, BRI's capital was able to be optimally maintained with a CAR of 20.92 percent.
"In the future, we are optimistic that a light will appear at the end of the dark tunnel and BRI will continue to make a positive contribution to all stakeholders amidst challenging economic conditions," concluded Sunarso.
Information about BANK BRI can be accessed through the website www.bri.co.id
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