Thursday, 28 September 2023

CEO of the Year in Asia Pacific goes to President Director of Bank Central Asia, Jahja Setiaatmadja

5 min read

By The Asian Banker

Under the exceptional leadership of Jahja Setiaatmadja,Bank Central Asia (BCA) has experienced extraordinary growth and achieved some of the strongest financial ratios by international standards. At the end of 2022, BCA reported a return on equity of 24.7% and a return on assets of 3.7%. The bank’s cost-to-income ratio also improved to 32.5%, reflecting efficient operational management as well as a 29.6% year-on-year record profit growth to $2.9 billion on the back of an improved net interest margin of 5.9%, a low non-performing loan ratio of 1.8% and robust capital adequacy ratio of 28.9%. 

The market capitalisation of BCA grew at a compound annual rate of over 44% over the past two years to reach a high of $79.8 billion at the end of April 2023. The bank serves Indonesia’s domestic market. It is not only the largest listed company in the country but also the largest bank in Southeast Asia by market capitalisation. 

The strategic emphasis of BCA on its stable funding base, particularly through retail saw current and savings account (CASA) growth of 5.7% year-on-year, supporting its strong liquidity position. CASA funding reached $59.9 billion as of March 2023, accounting for 81.2% of the bank’s total third-party funds.  

This focus on sticky-retail CASA has ensured a reliable and low-cost source of funds, supporting the bank’s financial resilience and profitability, with a healthy 65% loan-to-deposit ratio, on the back of 12% loan growth and declining share of long-tenor marketable securities. This is unlike the more volatile short-term wholesale/commercial funding and long-term held-to-maturity securities asset-liability mismatches that precipitated the current bank liquidity crisis in US.

Transactional banking through BCA’s online and offline channels such as the branches, are important in enhancing customer experience and satisfaction. In addition, the bank’s contact centre operates as a mega call centre, handling approximately 110,000 contacts per day, a level of customer experience that it aims to replicate through its online channels.

Furthermore, Setiaatmadja has led BCA to support sustainable initiatives and businesses. In 2022, the bank’s sustainable loan portfolio saw remarkable growth of 14.9%, amounting to $12.3 billion, comprising 25.4% of the bank’s total portfolio. This expansion underscores the bank’s dedication to promoting sustainability and cultivating environmentally responsible financing practices.

The award for CEO of the Year in Asia Pacific goes to President Director of Bank Central Asia, Jahja Setiaatmadja. 

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