This year we acknowledge the transformation under way at Bank BTN, also known as Persero.
As the only housing-focused bank in Indonesia, with mortgages making up 89% of its loan portfolio, Bank BTN acts as an accelerator for the government’s One Million Houses programme, which was launched in 2015 as a solution to a national housing backlog thought to stand at 11.4 million homes.
As the main distributor of government-subsidized mortgages, Bank BTN is well placed to be an agent of this state ambition, but its work has been impeded by Covid-19: the pandemic damaged economic activity and therefore individual purchasing power, reducing the demand for new mortgages and the ability to keep up payments on existing ones.
Consequently, BTN’s non-performing loan ratio is, at 4.37%, the highest among national banks. Tight liquidity has also made life difficult, and BTN faces a relatively high cost of funds.