State Savings Bank (BBTN) does not pay dividends, what are the analysts’ recommendations?

ILLUSTRATION. An employee is watching the movement of shares of PT Bank Tabungan Negara (Persero) Tbk, in Jakarta, Monday (8/6). State Savings Bank (BBTN) does not pay dividends, what are the analysts’ recommendations?

Reporter: Sugeng Adji Soenarso | Editor: I knew Laoli

KONTAN.CO.ID – JAKARTA. PT Bank Tabungan Negara (Persero) Tbk (BBTN) at the Annual General Meeting of Shareholders (AGMS) decided not to distribute dividends to shareholders.

According to the plan, all profits for the 2020 financial year will be used to strengthen the company’s tier 1 capital in the future.

Head of Research for Samuel Sekuritas, Suria Dharma, explained that this was because the company previously wanted to do so rights issue to strengthen capital because there is PSAK 71. This is because, he assessed coverage ratio BTN is always below 50%.

However, because the process was still complicated, because at that time it had to go through the DPR, the government decided not to distribute dividends considering that the net profit was still falling.

Also Read: BTN predicts that around 6% of the Covid-19 restructuring credit has the potential to become NPL

“This year they also still need a stronger capital structure so that if they distribute dividends, when the funds are needed they need to take from dividends, which ultimately means that the government has to pay up capital as well. So there might be flexibility for BTN not to distribute dividends,” he explained to kontan.co. id, Monday (22/3).

Binaartha Sekuritas analyst, M. Nafan Aji Gusta Utama said that although BTN did not distribute dividends this year, the company is still considered to have received appreciation from investors. “There is BTN’s commitment to improve performance so that it is still appreciated,” he said.

On the other hand, the BP Tapera program is also an attractive sentiment for Bank BTN to improve the company’s credit growth performance.

Therefore, he recommended BBTN’s stock accumulation with a target price of Rp 2,500 and Rp 2,860.

Meanwhile, Suria recommended BBTN with a target price of IDR 2,300. At the close of stock trading, Monday (22/3) BBTN closed at 1,890, down 1.56%.