4Q17’s Performance Review
BBCA recorded the interest income of IDR13.7 trillion surging by 6.5% y-y aligning with the growth of 6.4% into IDR10.9 trillion in net interest income. It also secured the net profit of IDR6.5 trillion or buoying by 18.1% underlined by the downbeat provision cost of 43.6% y-y.

Challenge of Margin Contraction
From 2Q17 to 4Q17, the net interest margin (NIM) was unstable; in fact, the trend of NIM consistently standing at around 6.5% in the prior periods hardly carried on; BBCA was capable of posting 4Q17’s NIM of 6.15%, for instance. We note the paradoxical backdrop: the trend of sliding loan yield into 9.6% coupled with the stable cost of deposit at 1.8%.

The sliding loan yield is a typical given backdrop resulted by the trend of currently accommodative BI’s 7-Day Repo Rate. Nonetheless, BBCA experienced that the surging contribution of 37.9% to the overall loan contributed by the corporation segment lessened its margin competitiveness.


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