FOCUS Bank Tabungan Negara Company Update 11 January 2017

Transcription

1 FOCUS XXX Company Update XX XXXXX 213 FOCUS Bank Tabungan Negara Company Update 11 January 217 Mandiri Sekuritas Analyst Tjandra Lienandjaja Priscilla Thany Sector : Banking BUY Current Price Rp1,84 Price Target Rp2,35 (+27.7%) Prev. TP:Rp2,15 52-wk range Rp2,1 - Rp1,3 Stock Data Bloomberg Code BBTN IJ Mkt.Cap (Rp bn/us$ mn) 19,486 / 1,462 Issued Shares (mn) 1,59 Avg. Daily T/O (Rp bn/us$ mn) 33.9/2.5 Major shareholder Gov of Indonesia 6.% Public 4.% EPS consensus Mansek Cons Diff 216F F F Share price performance 3m 6m 12m Absolute (3.9) Relative to JCI (2.4) Strong Loan Growth in 217 The government has changed the Rp4.8tr 215 FLPP scheme to interest rate subsidy, payable in 217. Loan growth is set at 2% this year, supported by housing related sectors, in particular the subsidized loans, which will lower NIM. We cut 217 forecast by 4%, but keep the Buy call with a new TP of Rp2,35. Change in government funds for subsidized housing loans (FLPP) scheme. BTN had yet to receive Rp5.3tr of FLPP for , Rp.5tr for 214 and Rp4.8tr for 215. The government decided in December 216 to pay for the 214 portion and to convert the 215 portion into interest rate subsidy (SSB based on 12-M BI rate). This subsidy will likely be paid in April 217, using the 217 state budget of Rp3.7tr. BTN expects to receive around Rp35bn of interest rate subsidy as compensation for this 215 subsidized housing loans. There is no issue for 216 subsidy, while the FLPP for 217 is set at Rp9.7tr with the funding portion between the government and BTN yet to be finalized, either at 85/15 or 9/1 split. Stronger loan growth of 2% expected for 217. We expect 2% loan growth for 217, up from 18% previously, while loan growth in 216 is estimated at 17%. Loan growth is expected to come from the subsidized housing and construction loans, followed by the non-subsidized housing loans, while non-housing loans is expected to grow less than 1%. FINANCIAL SUMMARY Lower NPL on the way. BTN has been trying to bring down the problem loans in the past three years and it seems to be working well. Peak NPL was 5.% in mid- 214 and this has gone down to 3.6% in September 216. The bank has indicated that the level has come down further to 3.3% in November 216 with the target of 3% by December. We project 3.1% NPL level in 216, going down to 2.8% in 217 (previously at 3.2% and 3.%, respectively). Better collection efforts and real loan quality improvement are the main reasons for our optimism for lower NPL level. Lower NIM in 217. High growth rate on subsidized housing loans (@ 5.% pa for 2 years) should lead to lower NIM, which we expect to decline around 8bps to 4.39% in 217 and by 15bps to 4.24% in 218. This leads us to lower our forecast by 4% for 217 and 8% for 218. Maintain Buy with new TP of Rp2,35. Despite the earnings downgrade we keep our Buy call on the counter with the new TP of Rp2,35 (previously Rp2,15) based on 1.36x P/BV 217E. Risks to TP are rising interest rates and weakening GDP growth. YE Dec (Rp Bn) 214A 215A 216F 217F 218F Pre-Provision Profit 2,349 3,428 3,855 4,391 5,191 Net Profit 1,146 1,851 2,43 2,843 3,37 EPS EPS Growth (26.7) P/E Ratio (x) BVPS 1,155 1,31 1,58 1,73 1,995 P/BV Ratio (x) Dividend Yield ROAE CAR Source: Company ( ), Mandiri Sekuritas ( ) Please see important disclosure at the back of this report Page 1 of 5

2 Company Update 11 January 217 BBTN - At a Glance FIGURE 1. LOAN, DEPOSIT GROWTH, AND LDR FIGURE 2. NET INTEREST MARGIN (% YoY) Q8 3Q8 1Q9 3Q9 1Q1 3Q1 1Q8 3Q8 1Q9 3Q9 1Q1 3Q1 LDR Total Loan Growth (YoY) [RHS] Total Deposit Growth (YoY) [RHS] NIM Interest Yield Cost of Funds FIGURE 3. LOAN BREAKDOWN FIGURE 4. DEPOSIT BREAKDOWN 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % 4Q8 2Q9 4Q9 2Q1 4Q1 2Q11 4Q11 2Q12 4Q12 2Q13 4Q13 2Q14 4Q14 2Q15 4Q15 2Q16 Subsidized mortgages Non-subsidized mortgages Other housing Construction loans Consumer loan Commercial loans 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % 4Q8 2Q9 4Q9 2Q1 4Q1 2Q11 4Q11 2Q12 4Q12 2Q13 4Q13 2Q14 4Q14 2Q15 4Q15 Current Accounts Savings Time Deposits 2Q16 FIGURE 5. NPL & COVERAGE RATIO FIGURE 6. CAR & EQUITY Rp Bn 2, 18, 16, 14, 12, 1, 8, 6, 4, 2, Q8 3Q8 1Q9 3Q9 1Q1 3Q1 1Q8 3Q8 1Q9 3Q9 1Q1 3Q1 Loan Loss Coverage NPL [RHS] Capital Base Total CAR [RHS] Please see important disclosure at the back of this report Page 2 of 5

3 Company Update 11 January 217 FIGURE 7. FORECAST CHANGES Year-end Dec 31 Old New Change (Rp bn) 216E 217E 218E 216E 217E 218E 216E 217E 218E Net interest income 7,867 9,37 1,878 7,854 9,175 1,571 (.2) (1.4) (2.8) Net interest margin Total income 9,145 1,781 12,576 9,118 1,632 12,25 (.3) (1.4) (2.6) PPOP 3,848 4,556 5,389 3,855 4,391 5,191.2 (3.6) (3.7) Operating profit 3,96 3,722 4,613 3,177 3,599 4, (3.3) (7.5) Reported net profit 2,439 2,951 3,659 2,453 2,843 3,37.6 (3.7) (7.9) Loan growth Deposit growth LDR NIM NPL Coverage ratio Write off/total loans Cost to income ROE CAR Source: Mandiri Sekuritas estimates FIGURE 8. NPL LEVEL PER SEGMENT Mar-9 Sep-9 Mar-1 Sep-1 Mar-11 Sep-11 Mar-12 Sep-12 Mar-13 Sep-13 Mar-14 Sep-14 Mar-15 Sep-15 Mar-16 Sep-16 Subsidized mortgages Non-subsidized mortgages Other housing Construction loans Consumer loans Commercial loans (incl. KUR) FIGURE 9.WRITE OFF/AVG. LOANS AND NPL LEVEL Write off/avg. loans F NPL level 217F 218F Please see important disclosure at the back of this report Page 3 of 5

4 Company Update 11 January 217 BTN Profit & Loss YE Dec (Rp Bn) 214A 215A 216F 217F 218F Interest Income 13,374 15,567 17,737 2,33 23,226 Interest Expense (7,893) (8,7) (9,883) (11,128) (12,655) Net Interest Inc. 5,482 6,867 7,854 9,175 1,571 Other Oper. Inc ,124 1,264 1,457 1,679 Operating Exp. (4,51) (4,562) (5,263) (6,241) (7,59) Personnel Exp.. (1,26) (1,459) (1,646) (1,889) (2,33) G & A (2,79) (3,13) (3,617) (4,352) (5,26) Others Pre-Prov. Profit 2,349 3,428 3,855 4,391 5,191 Provision Exp. (772) (894) (78) (792) (924) Operating Inc. 1,577 2,534 3,147 3,599 4,266 Pre-tax Income 1,579 2,542 3,144 3,598 4,266 Tax Expenses (434) (691) (715) (756) (896) Minority Int. Net Profit 1,146 1,851 2,43 2,843 3,37 Balance Sheet YE Dec (Rp Bn) 214A 215A 216F 217F 218F Assets Cash 92 1,181 1,387 1,648 1,976 Due to BI 9,372 1,986 1,5 12,5 15, Interbank Placement 1, ,14 1,324 Securities-Net 15,171 17,519 26,527 3,717 37,82 Gross Loan 115, , ,8 194, ,717 Loan Loss Prov. (1,577) (2,51) (2,148) (2,44) (2,864) Fixed Assets 1,488 1,553 4,833 5,227 5,653 Other Assets 2,191 3,12 3,563 2,252 3,599 Total Assets 144, ,88 27, , ,27 Liabilities & Equity Liabilities Demand Deposits 23,231 3,882 37,818 48,492 62,416 Saving Deposits 25,547 29,872 31,25 37,963 46,586 Time Deposits 57,71 66,992 81,6 91,779 14,7 Total Third Party Funds 16, ,746 15,28 178, ,72 Deposits From Oth. Banks Securities Issued 12,338 13,72 15,28 16,767 18,485 Borrowings 8,184 1,98 19,966 25,257 31,95 Subordinated Loan Other Liabilities 5,369 6,15 6,416 6,675 6,945 Total Liabilities 132,37 157, , , ,82 Minority Interest Shareholder's Equity 12,26 13,86 15,967 18,324 21,125 Total Liab. and Equity 144, ,88 27, , ,27 Key Ratios YE Dec (Rp Bn) 214A 215A 216F 217F 218F Growth (% YoY) Assets Loans Earnings Assets Non-Performing Loans Deposits Shareholders' Equity Net interest income (2.8) Non-interest income Operating expenses Pre-provision profit (8.8) Net profit (26.7) Common Ratios NIM LDR NPL Coverage ratio ROAE ROAA Total CAR Tier 1 CAR Other Ratios Yield on earning assets Avg. cost of funds Net Interest Spread CASA deposits Cost to income Equity to assets Dividend payout Effective tax rate Per Share Data YE Dec 214A 215A 216F 217F 218F EPS BVPS 1,155 1,31 1,58 1,73 1,995 DPS Valuations P/BV (x) P/E (x) P/PPOP (x) Dividend yield Please see important disclosure at the back of this report Page 4 of 5

5 Mandiri Sekuritas A subsidiary of PT Bank Mandiri (Persero) Tbk Plaza Mandiri 28 th Floor, Jl. Jend. Gatot Subroto Kav , Jakarta 1219, Indonesia General: , Fax : (Equity Sales) RESEARCH Tjandra Lienandjaja Deputy Head of Equity Research, Banking tjandra.lienandjaja@mandirisek.co.id Liliana S Bambang Property, Building Material liliana.bambang@mandirisek.co.id Adrian Joezer Consumer, Strategy adrian.joezer@mandirisek.co.id Ariyanto Kurniawan Telecom, Coal, Metal, Automotive ariyanto.kurniawan@mandirisek.co.id Bob Setiadi Construction, Toll Road bob.setiadi@mandirisek.co.id Francis Lim Quant, Health Care, Hospital francis.lim@mandirisek.co.id Yudha Gautama Mining, Plantation yudha.gautama@mandirisek.co.id Laura Taslim Retail laura.taslim@mandirisek.co.id Priscilla Thany Banking priscilla.thany@mandirisek.co.id Ferdy Wan Building Material, Industrial Est., Media ferdy.wan@mandirisek.co.id Lakshmi Rowter Research Assistant lakshmi.rowter@mandirisek.co.id Gerry Harlan Research Assistant gerry.harlan@mandirisek.co.id Leo Putera Rinaldy Chief Economist leo.rinaldy@mandirisek.co.id Wisnu Trihatmojo Economist wisnu.trihatmojo@mandirisek.co.id Aziza Nabila Amani Research Assistant aziza.amani@mandirisek.co.id INSTITUTIONAL SALES Lokman Lie Co-Head Institutional Equities lokman.lie@mandirisek.co.id Silva Halim Co-Head Institutional Equities silva.halim@mandirisek.co.id Aditya Sastrawinata Institutional Sales aditya.sastrawinata@mandirisek.co.id Andrew Handaya Institutional Sales andrew.handaya@mandirisek.co.id Cindy Amelia P. Kalangie Institutional Sales cindy.amelia@mandirisek.co.id Feliciana Ramonda Institutional Sales feliciana.ramonda@mandirisek.co.id Kevin Halim Institutional Sales kevin.halim@mandirisek.co.id Mirna Santikara Salim Institutional Sales santikara.salim@mandirisek.co.id Oos Rosadi Institutional Sales oos.rosadi@mandirisek.co.id Zahra Aldila Niode Institutional Sales zahra.niode@mandirisek.co.id Kusnadi Widjaja Equity Dealing kusnadi.widjaja@mandirisek.co.id Edwin Pradana Setiadi Equity Dealing edwin.setiadi@mandirisek.co.id Jane Theodoven Sukardi Equity Dealing jane.sukardi@mandirisek.co.id Michael Taarea Equity Dealing michael.taarea@mandirisek.co.id RETAIL SALES Andreas M. Gunawidjaja Head Retail Equities andreas@mandirisek.co.id Boy Triyono Plaza Mandiri boy.triyono@mandirisek.co.id A. A. Damargumilang Pondok Indah Office Tower damar.gumilang@mandirisek.co.id Herianto Pondok Indah Prioritas herianto@mandirisek.co.id Hendra Riady Mangga Dua hendra.riady@mandirisek.co.id Indra Mas'ari Bandung indra.mas ari@mandirisek.co.id Yogiswara P. Yogyakarta yogiswara.perdana@mandirisek.co.id Widodo Solo widodo@mandirisek.co.id Linawati Surabaya Linawati@mandirisek.co.id Bambang Suwanto Malang bambang.suwanto@mandirisek.co.id Ruwie Medan ruwie@mandirisek.co.id Aidil Idham Palembang aidil.idham@mandirisek.co.id Yuri Ariadi Pontianak yuri.ariadi@mandirisek.co.id INVESTMENT RATINGS: Indicators of expected total return (price appreciation plus dividend yield) within the 12-month period from the date of the last published report, are: Buy (15% or higher), Neutral (-15% to15%) and Sell (-15% or lower). DISCLAIMER: This report is issued by PT. Mandiri Sekuritas, a member of the Indonesia Stock Exchanges (IDX) and Mandiri Sekuritas is registered and supervised by the Financial Services Authority (OJK). Although the contents of this document may represent the opinion of PT. Mandiri Sekuritas, deriving its judgement from materials and sources believed to be reliable, PT. Mandiri Sekuritas or any other company in the Mandiri Group cannot guarantee its accuracy and completeness. PT. Mandiri Sekuritas or any other company in the Mandiri Group may be involved in transactions contrary to any opinion herein to make markets, or have positions in the securities recommended herein. PT. Mandiri Sekuritas or any other company in the Mandiri Group may seek or will seek investment banking or other business relationships with the companies in this report. For further information please contact our number or fax ANALYSTS CERTIFICATION: Each contributor to this report hereby certifies that all the views expressed accurately reflect his or her views about the companies, securities and all pertinent variables. It is also certified that the views and recommendations contained in this report are not and will not be influenced by any part or all of his or her compensation.