This optimism is based on the results of the MSMEs-BRI Business Activity Survey in the third quarter of 2020, which indicated that MSMEs’ business activities were beginning to perform well and believed to improve further in the fourth quarter.

The survey shows the BRI Micro & SME Index (BMSI) rose from 65.5 to 84.2 in the third quarter and is projected to increase to 109.3 for the fourth quarter.

The BMSI is a performance index of MSMEs’ business activities, consisting of the Business Activity Index (IAB), which shows the ongoing situation and the Business Activity Expectation Index (IEAB), which measures expectations for the next three months.

"We launch the BMSI index today to be used to measure MSMEs’ business activities as a form of BRI's concern about the national economy, and it will become one of the first leading indicators in Indonesia to measure MSMEs’ business activities. In the future, the BMSI will be published regularly on a quarterly basis so that it can become one of the considerations for public policy making," BRI president director Sunarso said while reporting the BRI’s third quarter performance virtually in Jakarta on Nov. 11.

The growing MSME activities have had a positive impact on BRI's third quarter performance.

Amid the ongoing pandemic, BRI was by the end of September still able to record positive and better credit and savings growth than the national banking industry as a whole.

One of the largest state-owned financial lenders in Indonesia, BRI disbursed loans amounting to Rp 935.35 trillion in the third quarter, which was a 4.86 percent increase from Rp 891.97 trillion in the same period last year. The value was higher than industrial credit growth of 0.12 percent (OJK data for September 2020).

BRI's MSME loans grew significantly from 78.10 percent in the third quarter of 2019 to 80.65 percent in the third quarter of 2020. This marked a milestone for the company, which for the first time was able to reach an MSME loan portion of 80 percent.

"We had expected this achievement for 2022, but BRI proved to be able to live up to the challenges more rapidly than expected," he said.

BRI also massively restructured its loans with the aim of helping MSMEs survive the pandemic adversities. By Sept. 30, it had channeled loans worth Rp 193.7 trillion to 2.95 million debtors.

As the government’s main partner in the national economic recovery mission, BRI had also disbursed financial aid to MSMEs worth Rp 5.98 trillion by the end of October.

"The incessant restructuring coupled with sound and selective lending was able to keep BRI's non-performing loan (NPL) ratio under control at 3.12 percent with NPL coverage of 203.47 percent at the end of September. BRI's NPL ratio was recorded below the NPL ratio of the national banking industry, which was 3.15 percent,” he said.

The liability of third party funds (DPK) was recorded at Rp 1.13 quadrillion, an increase of 18 percent year-on-year (yoy). The figure was above the national banking industry average of 12.88 percent.

Current savings accounts (CASA) still dominated BRI's savings portfolio, reaching 59.02 percent of total DPK, or Rp 668.10 trillion.

The strategy employed and adapted to the pandemic-related national economic recovery policies to keep the company growing healthily has yielded positive results. Until the end of September, BRI was able to record profit of Rp 14.15 trillion, with consolidated assets reaching Rp 1.44 quadrillion, a growth of 10.89 percent yoy.

BRI was also able to maintain an ideal loan to deposit ratio (LDR) at 82.63 percent, compared to last year’s 92.99 percent for the same period. The decrease in LDR has opened room for BRI to further reduce the cost of funds (CoF).

Meanwhile, BRI's capital adequacy ratio (CAR) was optimally maintained at 20.92 percent.

"In the future, we are optimistic there will be a light at the end of the dark alley and BRI will make a positive contribution to all stakeholders amidst challenging economic conditions," Sunarso said.

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