FOCUS Bank Tabungan Negara Company Update 21 January 2015

Transcription

1 FOCUS XXX Company Update XX XXXXX 213 FOCUS Bank Tabungan Negara Company Update 21 January 215 Mandiri Sekuritas Analyst Tjandra Lienandjaja Vanessa Ariati Tanuwijaya Sector : Banking BUY Current Price Rp1,1 Price Target Rp1,3 (+28.7%) 52-wk range Rp1,525 - Rp875 Stock Data Bloomberg Code BBTN IJ Mkt.Cap (Rp bn/us$ mn) 1,671 / 854 Issued Shares (mn) 1,565 Avg. Daily T/O (Rp bn/us$ mn) 42.3/3.4 Major shareholder Gov of Indonesia 6.2% Public 39.9% EPS consensus Mansek Cons Diff 214F F F (1.3) Share price performance 3m 6m 12m Absolute (12.6) (12.9) 4.7 Relative to JCI (16.3) (14.7) (12.5) Lowering the subsidized housing loan rates The government plans to lower rate on subsidized housing loans to 5.% from 7.25% in which BTN distributes more than 9% of the loans. Depending on the change in the scheme, we expect 215 earnings will swing between 29% reduction or 6% increase. We believe the counter is oversold and maintain our Buy call. Lower rates for subsidized housing loans. Under the draft revised budget 215, the government plans to lower the lending rate for subsidized housing loans to 5.% from 7.25%. The scheme, called FLPP (Fasilitas Likuiditas Pembiayaan Perumahan or liquidity facility for house financing), was started in 212 with BTN distributing more than 9% of it plus 2 other banks. Details for the new scheme are not available yet but the market reacted negatively on the news, expecting severe impact on earnings due to lower margin. Subsidized housing loans at 29% of total loans. As part of the subsidized housing loans, the FLPP makes up 19% of total loans currently, with the yield of 7.25%. Under the current scheme the government places the funds in BTN with.5% interest rate. This is blended with BTN funding, currently at 9.5%, with the composition of 75% for government and 25% for BTN (see scenario 1 in Figure 9). The 2.75% blended cost of fund plus 4.5% costs & margin would lead to 7.25% lending rate. FINANCIAL SUMMARY Worst case, 29% earning cut for 215, best case an increase of 6%. We put several scenarios on how the new scheme of FLPP will be. Under the worst scenario, NIM in 215 will decline 43bps and under the best scenario it will improve 9bps. Hence there would be adjustment in earnings, ranging from 29% reduction to 6% increase. Collateral assets sales are successful. In order to reduce the NPL, BTN has been selling the collateral assets (houses) for the bad debts with the proceeds to repay the outstanding loan principals. The move has been successful with sales reaching Rp1.3tr in 214 compared to Rp1.tr expectation. Given the good result, BTN plans to sell Rp tr collateral asset sales in 215. We expect NPL to decline to 4.2% at the end of 214 from the 5.% peak and to 3.6% by end of 215. Attractive valuation. We believe the bank is oversold and under several scenarios, there will be limited impact on P/BV valuation. Trading at.8x P/BV 215 we maintain our Buy call with TP of Rp1,3. YE Dec (Rp Bn) 212A 213A 214F 215F 216F Pre-Provision Profit 2,79 2,577 2,268 2,716 3,143 Net Profit 1,364 1,562 1,188 1,634 1,831 EPS EPS Growth (24.) P/E Ratio (x) BVPS 993 1,94 1,161 1,288 1,422 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 21 January 215 BBTN - At a Glance FIGURE 1. LOAN, DEPOSIT GROWTH AND LDR FIGURE 2. NET INTEREST MARGIN (% YoY) Q8 3Q8 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 Subsidized mortgages Non-subsidized mortgages Other housing Construction loans Consumer loan Commercial loans 4Q11 2Q12 4Q12 2Q13 4Q13 2Q14 1% 9% 8% 7% 6% 5% 4% 3% 2% 1% % 4Q8 2Q9 4Q9 2Q1 4Q1 2Q11 4Q11 2Q12 4Q12 2Q13 4Q13 Current Accounts Savings Time Deposits 2Q14 FIGURE 5. NPL & COVERAGE RATIO FIGURE 6. CAR & EQUITY 6 6. Rp Bn 14, , 1, 8, 6, 4, 2, Q8 3Q8 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 21 January 215 FIGURE 9. SCENARIO ON SUBSIDIZED HOUSING LOAN (FLPP) Scenario Current scheme Government portion Int. rate on gov t portion BTN's portion Funding cost on BTN s Blended CoF Cost+margin Lending rate Source: BTN, Mandiri Sekuritas estimates FIGURE 1. IMPACT ON EARNINGS AND VALUATION 215 base earnings (Rpbn) 1,634 Current NIM expectation 4.65 Portion of loan impacted BVPS (Rp) 1, EPS (Rp) 155 Scenario Current scheme Impact on NIM - (.43) (.39) (.36) (.17) (.13) (.9) Revised NIM Avg, earnings assets (Rpbn) 146, , , , , , , , , ,295 Earning chg. post tax (Rpbn) - (469) (43) (391) (188) (141) (94) Rev. 215 earnings (Rpbn) 1,634 1,165 1,24 1,243 1,446 1,493 1,54 1,634 1,686 1,738 Percentage revision - (29) (26) (24) (11) (9) (6) Revised BVPS (Rp) 1,288 1,244 1,247 1,251 1,27 1,275 1,279 1,288 1,293 1,298 Revised P/BV (x) Revised EPS (Rp) Revised PER (x) Source: Mandiri Sekuritas estimates Please see important disclosure at the back of this report Page 3 of 5

4 Company Update 21 January 215 BTN Profit & Loss YE Dec (Rp Bn) 212A 213A 214F 215F 216F Interest Income 9,16 11,197 13,468 15,566 17,348 Interest Expense (4,379) (5,558) (7,858) (8,81) (9,46) Net Interest Inc. 4,726 5,639 5,61 6,757 7,888 Other Oper. Inc Operating Exp. (3,224) (3,861) (4,125) (4,96) (5,736) Personnel Exp.. (978) (1,161) (1,365) (1,633) (1,92) G & A (2,246) (2,699) (2,76) (3,273) (3,816) Others Pre-Prov. Profit 2,79 2,577 2,268 2,716 3,143 Provision Exp. (214) (441) (666) (539) (78) Operating Inc. 1,865 2,136 1,62 2,177 2,436 Pre-tax Income 1,857 2,141 1,67 2,194 2,458 Tax Expenses (493) (579) (419) (559) (627) Minority Int. Net Profit 1,364 1,562 1,188 1,634 1,831 Balance Sheet YE Dec (Rp Bn) 212A 213A 214F 215F 216F Assets Cash ,52 1,227 1,425 Due to BI 7,298 9,859 9,5 11, 13, Interbank Placement ,18 1,319 Securities-Net 19,35 17,421 17,355 2,874 23,546 Gross Loan 81,411 1, , , ,844 Loan Loss Prov. (981) (1,137) (1,337) (1,425) (1,733) Fixed Assets 1,583 1,523 1,556 1,683 1,821 Other Assets 1,632 1,77 1,92 2,478 2,284 Total Assets 111, ,17 145, , ,56 Liabilities & Equity Liabilities Demand Deposits 13,14 18,897 21,496 25,71 3,219 Saving Deposits 21,11 23,68 27,92 32,556 38,537 Time Deposits 46,447 53,636 6,938 69,476 79,545 Total Third Party Funds 8,688 96,213 19, , ,32 Deposits From Oth. Banks Securities Issued 7,137 8,837 11,95 13,18 15,374 Borrowings 9,811 1,8 7,814 9,25 1,424 Subordinated Loan Other Liabilities 3,834 4,556 4,826 5,168 5,377 Total Liabilities 11,47 119, , , ,476 Minority Interest Shareholder's Equity 1,279 11,557 12,269 13,66 15,29 Total Liab. and Equity 111, ,17 145, , ,56 Key Ratios YE Dec (Rp Bn) 212A 213A 214F 215F 216F Growth (% YoY) Assets Loans Earnings Assets Non-Performing Loans (.5) 1.6 Deposits Shareholders' Equity Net interest income (.5) Non-interest income (1.9) Operating expenses Pre-provision profit (12.) Net profit (24.) 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 212A 213A 214F 215F 216F EPS BVPS 993 1,94 1,161 1,288 1,422 DPS Valuations YE Dec 212A 213A 214F 215F 216F 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 Research), (Equity Sales) RESEARCH John Rachmat Head of Equity Research, Strategy john.rachmat@mandirisek.co.id Tjandra Lienandjaja Banking tjandra.lienandjaja@mandirisek.co.id Handoko Wijoyo Construction, Toll Road handoko.wijoyo@mandirisek.co.id Hariyanto Wijaya, CFA, CFP, CPA Plantation, Heavy eq., Energy hariyanto.wijaya@mandirisek.co.id Herman Koeswanto, CFA Consumer, Poultry herman.koeswanto@mandirisek.co.id Liliana S Bambang Property, Building Material liliana.bambang@mandirisek.co.id Ariyanto Kurniawan Telecom, Coal & Metal Mining ariyanto.kurniawan@mandirisek.co.id Matthew Wibowo Retail matthew.wibowo@mandirisek.co.id Rizky Hidayat Property, Media rizky.hidayat@mandirisek.co.id Vanessa Ariati Tanuwijaya Banking, Health Care vanessa.tanuwijaya@mandirisek.co.id Aldian Taloputra Economist aldian.taloputra@mandirisek.co.id Leo Putra Rinaldy Economist leo.rinaldy@mandirisek.co.id Aditya Sastrawinata Research Assistant aditya.sastrawinata@mandirisek.co.id Wisnu Trihatmojo Research Assistant wisnu.trihatmojo@mandirisek.co.id Yudha Gautama Research Assistant yudha.gautama@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 Andrew Handaya Institutional Sales andrew.handaya@mandirisek.co.id Cindy Amelia P. Kalangie Institutional Sales cindy.amelia@mandirisek.co.id Jane Theodoven Sukardi Institutional Sales jane.sukardi@mandirisek.co.id Janefer Amanda Soelaiman Institutional Sales janefer.soelaiman@mandirisek.co.id Karmia Tandjung-Nasution Institutional Sales karmia.tandjung@mandirisek.co.id Mirna Santikara Salim Institutional Sales santikara.salim@mandirisek.co.id Oos Rosadi Institutional Sales oos.rosadi@mandirisek.co.id Vera Ongyono Institutional Sales vera.ongyono@mandirisek.co.id Yohan Setio, CFA Institutional Sales yohan.setio@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 RETAIL SALES Ridwan Pranata Head Retail Equities ridwan.pranata@mandirisek.co.id Boy Triyono Jakarta Branch boy.triyono@mandirisek.co.id Yohanes Triyanto Kelapa Gading Branch yohanes.triyanto@mandirisek.co.id Hendra Riady Mangga Dua Branch hendra.riady@mandirisek.co.id Umar Abdullah Pondok Indah Branch umar.abdullah@mandirisek.co.id Indra Mas ari Bandung Branch indra.mas ari@mandirisek.co.id Yuri Ariadi Pontianak Branch yuri.ariadi@mandirisek.co.id Ruwie Medan Branch ruwie@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 (1% or higher), Neutral (-1% to1%) and Sell (-1% 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.