Private lender PT Bank Danamon Indonesia Tbk (BDMN) has allocated between US$ 100 and US$ 115 million (IDR 1.5-2.3 trillion) Capital expenditure for 2023 to achieve its net profit growth.
Danamon was established in 1956 under the name PT Bank Kopra Indonesia. In 1976, the bank’s name was changed to Danamon and had focused on foreign exchange transactions since then. In 1989, the company went public. The government took over the bank in 1988 due to the Asian financial crisis. Five years later, Asia Financial (Indonesia) Pte. Ltd., under the control of Singapore’s Temasek Holdings, acquired the government’s majority shares. Japan’s Mitsubishi UFJ Financial Group (MUFG) bought Danamon’s 19.9% and 20.1% shares from Asia Financial in December 2017 and July 2018, respectively. In April 2019, MUFG merged Danamon and Bank Nusantara Parahyangan (BNP), making it the majority shareholders with 94.1% stake of Danamon. Danamon’s subsidiaries are: PT Adira Dinamika Multi Finance Tbk and PT Adira Quantum Multifinance.
Focusing on digitalization
Danamon expects to reach its net profit growth in 2023 by using its Capex funds. “In the last 3 years, we have always invested. In 2022, we invested around US$ 90 million as Capex. This year, we estimate US$ 100-115 million for Capex, or an increase by 15-18%,” Vice President Honggo Widjojo Kangmasto said on February 15, 2023, as quoted by beritasatu.com.
The company also focuses on its digital business capabilities. Danamon has recruited special work forces outside of the company as well as creating internal new talents. The bank has established a special training for IT called the Danamon Technology Trainee (DTT).
“Apart from the DTT, we also have General Bankers Trainees (GBT). We continue to produce talents from our internal manpower and train them according to Danamon’s needs,” said Kangmasto.
Challenges in finding digital talents
Kangmasto revealed that grooming digital talents was a challenge for banks. “I don’t think it’s only [the problem of Danamon]. With so many startup companies, digital and conventional banks are developing their digital capabilities. Therefore, we must have IT staff,” he said as quoted by bisnis.com on February 16, 2023.
Danamon’s Director of Finance Muljono Tjandra also said that the company has committed to work on the digital sector, including through the Next Generation Branch concept. “We see that this investment needs to be carried out, according to our commitment to support business continuity in the future,” he added.
