First of all, it is very fortunate that Bank Mutiara was purchased by J Trust which is a leading company from Japan owned by one of Japan’s most prominent tycoons. Regarding our strategy for the immediate future; my main focus is on the consolidation of the bank and also its transformation. This process of transformation has begun with the rebranding by renaming the bank to Bank J Trust Indonesia in order to harmonise with the other subsidiaries under J Trust. This transformation will also involve shifting our concentration from a high end customer base to more small, medium and micro enterprise customers.

For 2015 we are carrying out a structural reorganisation to decentralise the business from the head office to the branches in the regions to improve speed and efficiency in our processes. We are also undertaking two projects; the first is regarding transactional banking. Previously, Bank Mutiara’s source of funds was dominated by time deposits with approximately 80-90% of funds from this source and the remainder from current and savings accounts which makes the cost of funds high. Therefore to lower the cost of funds we must increase the number of current account and savings accounts [CASA]. We are now working with consultants and are changing the paradigm among our people who are the most important feature of the bank so that they are aligned with the goal of lowering the cost of funds. To support this, we are also developing our IT system to streamline transaction processing. J Trust has sent one director from Japan who is an expert in IT systems and another director who is a seasoned expert in risk management.

The second project is in relation to the loan side and will involve a shift in the focus of our lending from corporate and multi financing to micro, small and medium enterprise financing. We will expand our micro kiosks to support this as well as carry out the recruitment of human resources qualified in small business loans. The challenge in small business loans is the education of our customer base and also to create competitive products and effective business process engineering. The target is that by the successful completion of these two goals in 2015 and further targets moving forward, the bank will be in a stage of sustainable growth by 2019.

Cross border transactions will be an additional area of attention for the future in order to leverage J Trust’s unique advantage as a regionally present financial institution by using their network particularly for Japanese and Korean customers. For example, we can serve investors looking to purchase Indonesian bonds and securities given the high yields that Indonesia offers versus their home markets. This is an opportunity within fee based transactions for the bank to take advantage of. Attracting funds from Japanese and foreign banks is a further area for us to cooperate with J Trust.

The bank’s plans regarding the opening of further microfinance kiosks in 2014 has been conservative with the opening of no more than 50 kiosks. Rather, the expansion will come from the IT system and establishing relationships with business cooperatives and multi finance firms by replicating our own system. Through this we can share the fees for example as opposed to expanding independently which would require the investment of significant capital; this method allows for inorganic growth.

The bank must maintain its expertise in bank note transactions, especially as our human resources in our branches are already skilled in this field. Now 80% of our clients in this field are money exchange companies and what we plan to do now is to go directly to the hotels in major tourist hubs such as Bali as well as travel companies. Through these relationships we can serve those requiring bank note transaction services directly to increase the speed of the transactions themselves. This will commence at the end of this year. The bank must increase its foreign exchange transactions in line with what I mentioned previously regarding cross border transaction opportunities.

Right now we are consolidating the bank and also redeveloping our products to create a ‘product champion’ in our product portfolio as at the moment we offer only conventional products. Within savings products for example, we will introduce a specialised savings account targeted at young people which has already been done successfully by J Trust in Korea. Also for mortgage loans, we can develop specialised products for newlywed couples for example by working directly with property developers to offer discounted rates.

The bank is now owned by an international investment company and therefore we must be an internationally minded bank by acting globally and not only locally. This is now an opportunity for us to grow our network and to improve so as to attract further investment into Indonesia.