Bank Niaga Hopeful of Taking 5th Place in Credit-Card Market
November 27 2007
Source: The Jakarta Post
With a continuing increase in the number of its credit cardholders over the last few years, Bank Niaga hopes to become the country's fifth largest credit-card issuer within five years.
The bank's president director, Hashemi Albakri bin Abu Bakar, said that the growth in the number of the bank's cardholders had been encouraging over the last five years, exceeding the industry's average growth of about 20 percent.
"The number of our credit cards grew about 45 percent in the first nine months of this year, far higher than the average growth level in the industry," Hashemi told reporters following the launch of the company's Niaga Platinum Card in Kuala Lumpur, Malaysia, last week.
At present, the number credit cards issued by Niaga totaled some 330,000, more than five times the number five years ago. Meanwhile, the value of the bank's credit-card transactions grew by about 30 percent up to September this year, accounting for about 3.6 percent of the total transaction value recorded by the industry.
With the current growth rate, it would be quite feasible for the bank to become the fifth biggest issuer around 2011, he said. Hashemi said the newly launched platinum card alone would attract 12,000 new credit cardholders next year. "So, it is quite possible," he stressed.
The Niaga Platinum, which is issued in collaboration with MasterCard Worldwide, is one of a series of cards offered by the bank. The new card, which is specially designed for the bank's 12,000 top-range customers, offers a wide range of incentives and facilities, such as insurance protection, quick cash and points rewards.
The country's largest credit card issuers are Citibank, Bank Mandiri, Bank Central Asia (BCA) Bank Negara Indonesia (BNI) and HSBC Bank. Bank Niaga, which is controlled by Malaysian financial giant CIMB Group, had total assets of Rp 47.32 trillion (about US$5 billion) as of September.
The bank's vice president, D. James Rompas, said the bank's net profit totaled Rp 590 billion in the first nine months of this year, about 10 percent more than in the same period last year. Last week, CIMB's newly established CIMB Foundation presented a scholarship fund worth about 1 million ringgit (about US$300,000) to Bank Niaga, which will use the money to provide scholarships to Indonesian high school students wishing to study in Malaysia.
The CIMB Group has pledged about 100 million ringgit over three years to the foundation, a non-profit organization that will carry out corporate social responsibility and philanthropic initiatives both in Malaysia and Indonesia.