After a difficult year in the 2021 Top 1000 ranking, many Indonesian banks have improved their positions in 2022. Kimberley Long reports.
Indonesia’s banks have seen a strong year in this year’s Top 1000 World Banks, as increases in Tier 1 capital helped them to climb up the ranking. The country has emerged from the initial impact of the Covid-19 pandemic in good shape, with the economy growing by 3.7% during 2021. The forecast looks even better for 2022, with the World Bank forecasting a 5.1% growth rate.
Indonesia has 25 banks in the country ranking this year, but because of the high number of foreign-owned subsidiaries in the country, only 10 make it into the main Top 1000 ranking, with five of them being in the top 500. There is little movement in the overall country ranking, with 17 maintaining the same places as in the 2021 results. There is, however, more movement within the Top 1000 ranking.
Bank Rakyat Indonesia (BRI), the biggest bank by Tier 1 capital, enjoyed a good year, climbing 27 spots to 104th, thanks to a 39.5% increase in Tier 1 capital to $18.65bn. Second-largest Bank Central Asia (BCA) also climbed the main ranking, moving up five places to 133rd. And Bank Mandiri, which was seven places behind BCA in 2021, now sits just once place behind in 134th position after a 12.3% increase in Tier 1 capital. Bank Mandiri has overtaken BRI to become the country’s largest lender by total assets.
However, the real success story comes from Bank Negara Indonesia (BNI). While climbing one place to fourth in the country ranking, the bank entered the top 200 in the main ranking, reaching 192nd place, thanks to a 17.8% increase in Tier 1 capital. The bank also saw 142.7% increase in pre-tax profits, almost three times the increase of BRI.
BRI is the best performer out of the five largest domestic banks, topping the performance table in soundness, return-on-risk and profitability. It moved up from third place last year. BCA maintains its second-place position for the second year running, with good scores in operational efficiency, asset quality, return on risk and liquidity.
BNI, which tops the table for liquidity, has moved from last place to third, leapfrogging Bank Mandiri which remains in fourth position. Bank Pan Indonesia (Panin Bank) falls from first to last place; however, it trumps its much larger rivals with first place for operational efficiency and leverage. Panin Bank is let down by its overall results, as it saw its Tier 1 capital, assets and pre-tax profits decline in 2021.
Outside the country’s top five largest banks, in 15th place in the country ranking, Bank Mega enjoys not only Indonesia’s highest return on assets (ROA) ratio at 3.02%, but also the fourth highest ROA in the Asia-Pacific region (excluding China and Japan).
