Bank Central Asia (BCA) has seen a jump in its digital banking transactions amid the COVID-19 pandemic as it works to ramp up its new digital banking arm.

BCA, the largest private bank in Indonesia, recorded a 91 percent annual rise in the number of mobile banking transactions to 1.29 billion, while the number of internet banking transactions increased by 24 percent year-on-year (yoy) to 740 million in the first quarter, company data show.

The total value of the transactions reached a staggering Rp 3.38 quadrillion (US$2.28 trillion), or more than 45 percent of the bank’s total transactions, almost matching the value of transactions via the bank’ branches of Rp 3.5 quadrillion.

“BCA supports the physical distancing policy during the COVID-19 pandemic through its Banking from Home campaign, in which we provide banking services through various online channels. We have seen an increase in mobile and internet banking transactions [during the period],” BCA president director Jahja Setiaatmadja said in a livestreamed press briefing on Wednesday.

Transactions via ATMs and branch offices, at the same time, were down by 1 percent and 5 percent, respectively. 

As a result, its non-interest income soared 25.5 percent yoy to Rp 5.9 trillion, while its net interest income jumped 14.1 percent to Rp 13.68 trillion during the first quarter. The bank reported that its net profit grew by 8.6 percent to Rp 6.58 trillion in this year’s first three months.

BCA is known for its technology and digital breakthroughs in Indonesia’s banking industry. It is now working to complete the acquisitions of privately-owned Rabobank International Indonesia and Bank Royal Indonesia. The latter is projected to become BCA’s digital bank, namely Bank Digital BCA, the soft launching of which is to be held in the second half.

“Bank Royal still needs [the authority’s] approval to be a digital bank, while the acquisition of Rabobank is still being completed,” he said, stressing that BCA currently had no plan to acquire other banks.

BCA concluded in 2019 its acquisition of Bank Royal for Rp 1.01 trillion in an effort to expand its digital banking business and focus on certain customer segments.

BCA reported on Wednesday that its loan disbursement grew 12.3 percent annually to Rp 612.16 trillion as of March, while third-party funds (DPK) added 16.8 percent to Rp 741.02 trillion. Its non-performing loan (NPL) ratio stood at 1.6 percent, slightly up by 10 basis points (bps) compared to the corresponding period last year.

Jahja admitted that his company had seen a downturn in consumer loans, as mortgages, vehicle loans, credit card and employee loans decreased, and the situation would most likely continue.

The coronavirus outbreak has disrupted Indonesia’s banking industry as various businesses were forced to shut due to slowing demand, while millions of people are out of work, slowing loan disbursement and jeopardizing credit repayments.

Financial Services Authority (OJK) data reveal that loan growth stood at 7.95 percent yoy in the first quarter, higher than the 6.08 percent recorded at the end of last year. However, no new loan demand was recorded in the period, as the growth came from the disbursement of existing credit facilities.

“It is not the right time to push for consumer credits, especially with customer’s dwindling purchasing power and a significant amount of loans being restructured recently,” Jahja said.

BCA as of mid-March has been processing loan restructuring worth between Rp 65 trillion and Rp 82.6 trillion, or 10 percent to 14 percent of its total loan portfolio, from around 72,000 debtors following the government’s stimulus to support businesspeople and consumers affected by the pandemic.

It expects the restructuring figure to increase to around 20 percent to 30 percent of its total loan in the next few months.

“BCA has relatively little loan outstanding that is directly linked to COVID-19,” Mirae Asset Sekuritas Indonesia analyst Lee Young-jun wrote in a research note published on April 2.

“In addition, BCA revealed that it has less than 5 percent exposure on foreign exchange loans and less than 1 percent of capital in net open foreign position,” Lee said. 

BCA’s shares, traded at Indonesia Stock Exchange (IDX) under the code BBCA, were up 6.65 percent on Thursday, handily outperforming the exchange’s main gauge, the Jakarta Composite Index (JCI), which was up 1.61 percent.