Tuesday, 28 May 2024

BRI’s wealth business continues a decade-long upswing to nearly $10 billion AUM

5 min read

By The Asian Banker

BRI’s robust growth in wealth business is driven by the bank’s aggressive collection of CASA and fee-based income through the increased transactions in wholesale segments as well as optimising digital payment platforms.

Bank Rakyat Indonesia (BRI), one of the leading consumer banks in Indonesia was recognised as the Best Wealth Management Bank in the country by The Asian Banker Excellence in Retail Financial Services programme for its agile transformation journey, a 130 million strong customer base and 21% growth in affluent customer base.

BRI actively supports government programs for economic recovery and strengthening financial inclusion in wake of the COVID-19 pandemic. The action was translated to its government bond sales of more than $730 million (IDR 11 trillion), up by 21% year on year (YoY) and increase in number of investors with 31% YoY growth. As a result, the bank recorded a market share of 11% on government bond sales in 2021.

Financials: BRI’s wealth management grew by 35% CAGR, and 21% CAGR growth in AUM  over the last decade

Despite the setbacks brought by the COVID-19 pandemic, BRI’s wealth management turned in solid financial growth, with assets under management (AUM) continued a decade-long upswing to grow 9% year-on-year (YoY ).

BRI’s compounded annual growth rate (CAGR) fee-based income grew by 35% in one decade, in which 82% of the  growth last year was contributed by bancassurance products, and CAGR 21% growth in AUM.  The group has capabilities ranging from venture capital, securities companies and insurance companies, which enable the bank to provide breadth and depth of products and services to its customers.

Tina Melina, EVP Wealth Management, Bank Rakyat Indonesia

Digital Journey: The bank leveraged digital transformation journey for its wealth business to provide seamless customer experience

BRI‘s wealth management platform is developing a personalised digital-enabled recommendation  for clients and relationship managers (RMs). The platform will allow customers do straight-through onboarding, directly execute transactions, and have 360-view of their investment portfolio.  It will have an enhanced customer profiling process to tailor offerings based on customer characteristics and needs. The new risk profile questionnaire incorporates chosen customer variables for profiling customer into several personas, each with specific unique needs and behaviour.

The upcoming wealth management platform also enables RMs to utilise the tool to conduct client profiling, schedule advisory sessions, assist execution and monitor portfolio. This ensures systematic advisory process and convenience through single point contact for customers. The platform will also be equipped with a robo-advisory feature, an integrated financial plan to help RMs to present a recommendation for the customers. The system captures the customer’s current status and through an insight questionnaire detailing the customer’s future plans, the system generates a comprehensive financial planning recommendation that is suitable to customer’s needs.

Customer Experience: Affluent customer base saw a double-digit growth with nearly 70% digitally-active clients

With over 126 years of providing financial solutions for customers in Indonesia, BRI recorded a customer base of 130 million which translate to more than 40% of the Indonesia’s total population. The bank has a wide presence across the country with a total 9,000 branches, sub-branches, and units in 34 provinces and more than 600,000 salesforce and agents, which are mobilised to provide continuous support and seamless banking services for its customers.

BRI’s wealth management offers a variety of investment products to facilitate customers who seek to increase the value of their assets. This includes retail state bonds, retail sukuk, retail savings bonds, sukuk savings, SBN, rupiah-denominated government bonds, swap deposit, and financial institution pension funds. The bank also works with leading investment managers with different mutual fund products which includes money market mutual funds, fixed income, mixed funds, stocks, and protection. The bank’s bancassurance customer portfolio is tailored to three segments such as retail, Priority, and Private segments. BRI Prioritas & BRI Private Service provides banking services to selected individuals, which not only include banking services, but also financial and investment planning consulting services.

The bank saw a growth of affluent customers by 21% YoY in which almost 70% are digitally-active. In order to understand the customer behaviors, the bank introduced several initiatives including the launch of more than 100 products ranging from basic investments to structured products as well as different types of privileges for every high-net worth (HNW) customer such as concierge service, travel, lifestyle, health, and information benefits. The bank also introduced tailored advisory with personalised approach and investment recommendations based on the customer’s needs and financial status. BRI also hired highly experienced RMs which the total number increased by 20% YoY. As the bank also values customer milestones through birthday gifts, life moment appreciation, religious days, and other customer celebrations, it garnered a relationship manager net-promoter based BankQuality Score of 99.38.

Tina Meilina, executive vice president of BRI wealth management remarked, “Despite the economic uncertainty coming from COVID-19 pandemic, we have managed to grow effectively compare to our previous year achievement. We are also aware that services to clients are not only provided through our wealth manager but also quick solutions through integrated digital service solutions. Therefore, it becomes one of our strategic moves to deliver a better service for our clients. We sincerely appreciate this remarkable recognition. We believe that winning this award as the best wealth management in Indonesia will encourage us to continuously enrich our offering as another key action step to cement our leadership in the market. ”

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