A Wind-Down That Finished the Job, and a Recovery That Held
The 9M 2023 post described the Sharia Business Unit's return to profit as a shrinking act, not a turnaround: its financing book was down 58.9% in nine months. FY2023's full-year numbers show that shrinkage wasn't a phase - it was the plan running to completion. Sharia financing (gross) fell from Rp2,202,599 million at 31 December 2022 to just Rp428,551 million at 31 December 2023, a decline of 80.5% for the year, and more strikingly, 52.6% in the fourth quarter alone (from Rp904,678 million at 30 September). Whatever book the Sharia unit still had in September, more than half of what remained was gone three months later. The unit's Financing to Deposit Ratio» - its own disclosed figure, not a derived one - fell to 60.45% at year-end, down from 112.00% at September and 186.06% a year earlier.
And yet the unit kept earning money doing it. Backing out the already-disclosed 9M 2023 figure (Rp29,354 million) from FY2023's Rp35,002 million shows a standalone Q4 2023 Sharia net income of approximately Rp5,648 million - its second consecutive profitable quarter, and larger than Q3's implied Rp2,401 million. A unit earning more each quarter while its book shrinks toward nothing isn't recovering the way a normal business recovers; it's being wound down profitably, collecting on what's left of a loan book it has stopped originating into. Sharia total assets tell a related but different story - they grew to Rp1,648,603 million (still down 31.4% YoY, but up from Rp1,320,084 million at September) because the unit redirected its shrinking financing book's proceeds into marketable securities (Rp980,243 million at year-end, from zero a year earlier) rather than lending them back out.
The other half of this backfill's running story - whether the conventional bank's Q2 2023 blowout quarter (~Rp31.4 billion, its best ever) was repeatable - has a more encouraging answer this quarter than last. Bank Jago's FY2023 net income reached Rp72,362 million, up 354.7% YoY from Rp15,913 million (FY2022's own net income had been depressed by a one-off tax effect the year before it, as the FY2022 post covered). Subtracting FY2023's already-known 9M figure (Rp50,294 million) implies standalone Q4 2023 net income of Rp22,068 million, the bank's best quarter since Q2's spike. Backing out the Sharia contribution the same way: FY2023 conventional-bank net income was approximately Rp37,360 million, against 9M's implied Rp20,940 million, meaning standalone Q4 2023 conventional-bank profit was roughly Rp16,420 million - more than double Q3's implied Rp7,377 million. That's two consecutive quarters of the conventional bank improving off its own trough, not one good quarter surrounded by weak ones. It's still nowhere near Q2's size, but "durable, if smaller" is a different story than "one-off."
The Prescription
Bank Jago should keep doing exactly what got the conventional bank to two improving quarters in a row: NPL fell to a new backfill-best 0.84% gross / 0.05% net even as the loan book grew 38.1% YoY, and cost of credit relative to average loans fell every single quarter of 2023 (5.3% in FY2022 down to 1.7% in Q4 2023 alone, per the bank's own quarterly disclosure) - underwriting discipline holding up while the book scales is the single hardest thing for a growth-stage lender to pull off, and Jago is currently pulling it off. What it should stop doing is letting its funding mix drift back toward expensive money the moment growth accelerates: the CASA» ratio, which improved for three straight quarters through September to 73.2%, reversed to 65.3% at year-end as time deposits nearly doubled quarter-over-quarter (Rp2,761 billion to Rp4,187 billion) to fund the loan book's growth. A bank that spent all of 2023 building a cheap-deposit story shouldn't let one quarter's funding scramble undo three quarters of progress on the metric that story depends on.
Key Financial Metrics
FY2023 vs. FY2022 - PT Bank Jago Tbk
FX: IDR 15,425 = USD 1 (29 December 2023 close, nearest trading day to period-end). The published statements for this period report the Bank on a standalone basis only - Bank Jago has no consolidated subsidiaries, consistent with every prior post in this backfill.
| Metric | FY2023 (IDR) | FY2023 (USD) | FY2022 (IDR) | YoY |
|---|---|---|---|---|
| Net interest and Sharia income ("Net Revenue" equivalent) | Rp1,565,443M | ~$101.49M | Rp1,352,996M | ✅ +15.7% |
| Impairment losses on financial assets | -Rp401,309M | -~$26.02M | -Rp392,669M | ✅ +2.2%, flat despite loan book growing 38.1% |
| Operating income | Rp86,794M | ~$5.63M | Rp12,719M | ✅ +582.4% |
| Income before income tax | Rp93,563M | ~$6.07M | Rp20,428M | ✅ +358.0% |
| Income tax expense (current + deferred) | -Rp21,201M | -~$1.37M | -Rp4,515M | +369.5%, an expense both years |
| Net income for the year | Rp72,362M | ~$4.69M | Rp15,913M | ✅ +354.7% - Q4 standalone (~Rp22.1bn) was the bank's best quarter since Q2's spike, see above |
| Earnings per share (full amount, basic and diluted) | Rp5.22 | ~$0.0003 | Rp1.15 | ✅ +353.9% |
Net cash flows generated from operating activities were Rp2,250,076 million (FY2022: Rp1,504,729 million), driven by continued deposit growth outpacing loan growth in cash terms; capital expenditure (fixed and intangible assets acquired) was Rp651,482 million (FY2022: Rp488,348 million), against Rp2,954,422 million (~$191.55M) of period-end cash and cash equivalents. Operating income (the bank's own regulatory-format figure, netting impairment losses against revenue) is the closest bank equivalent to Adjusted EBITDA; the concept itself doesn't meaningfully apply to a deposit-taking institution.
| Balance sheet metric | Dec 2023 (IDR) | Dec 2023 (USD) | Dec 2022 (IDR) | YoY |
|---|---|---|---|---|
| Total Assets | Rp21,295,840M | ~$1,380.61M | Rp16,965,295M | ✅ +25.5% |
| Loans and Sharia financing (net) | Rp13,020,051M | ~$844.09M | Rp9,427,987M | ✅ +38.1% |
| Total customer deposits (current, savings, time) | Rp12,067,195M | ~$782.31M | Rp8,274,385M | ✅ +45.8% |
| Total Liabilities | Rp12,939,048M | ~$838.84M | Rp8,701,538M | +48.7%, tracking balance sheet growth |
| Total Equity | Rp8,356,792M | ~$541.77M | Rp8,263,757M | +1.1%, still essentially flat |
The headline "net income up 354.7%" is real, and unlike FY2021's own headline profit (mostly a one-off deferred tax credit), this year's growth is genuine operating improvement - income before tax alone grew 358.0%. The number worth remembering is smaller and better: the conventional bank's Q4 profit more than doubled Q3's, the second straight quarter of improvement rather than a one-off, while the Sharia unit finished the year having shed more than four-fifths of the financing book it started with.
Key Operational Metrics
Ratios below are sourced from PT Bank Jago Tbk's own published financial ratios (31 December 2023 vs 31 December 2022) and its "FY2023 Results Update" investor presentation.
- CASA ratio»: 65.3% (Dec 2023, calculated from Rp7,880,443M current + savings deposits ÷ Rp12,067,195M total deposits) vs. 73.2% (Sep 2023, per the 9M 2023 post) vs. 69% (Dec 2022) - a reversal of three straight quarters of improvement, as fast-growing time deposits diluted the mix; still above FY2022's level but the trend broke this quarter, see The Prescription.
- Loan-to-Deposit Ratio»: 107.77% (Dec 2023, per the bank's own filed ratios) vs. 105.33% (Sep 2023, per the 9M 2023 post) vs. 113.76% (FY2022) - ticked back up slightly this quarter but still well below FY2022's level.
- NIM»: 9.45% (Dec 2023, per the bank's own filed ratios) vs. 10.45% (FY2022) - a fourth straight period of decline as the funding mix shifts toward costlier deposits; the investor presentation shows the quarterly progression running 11.0% (Q1) → 10.0% (Q2) → 9.0% (Q3) → 8.0% (Q4), a steady quarter-on-quarter erosion the full-year average partly obscures.
- NPL»: 0.84% gross / 0.05% net (Dec 2023, per the bank's own filed ratios) vs. 1.15%/0.14% (Sep 2023, per the 9M 2023 post) vs. 1.82%/0.55% (Dec 2022) - a new backfill-best for a fourth straight quarter running.
- CAR»: 61.77% (Dec 2023, per the bank's own filed ratios) vs. 71.33% (Sep 2023) vs. 82.75% (Dec 2022) - still falling every quarter as capital gets deployed into risk-weighted loans, now down to roughly 6x OJK's 10% minimum requirement, from over 8x a year ago.
- ROE» / ROA»: 1.02% / 0.49% (FY2023, per the bank's own filed ratios) vs. 0.21%/0.14% (FY2022) - both improved meaningfully YoY, though still far below what the ~4.8x book-value premium (see Target Valuation Range) would imply is sustainable.
- Cost-to-Income»: 72.31% (Dec 2023, per the bank's own filed ratios) vs. 69.43% (Sep 2023) vs. 71.67% (Dec 2022) - a second straight quarter of deterioration; the investor presentation shows the quarterly ratio climbing from 67% (Q2) to 75% (Q3) to 82% (Q4), the worst single quarter in this backfill.
- Cost of Funds (period-end, per the investor presentation): 3.0% (Q4 2023) vs. 2.9% (Q3 2023) vs. 2.8% (FY2022) - rising as the deposit mix shifts toward time deposits.
- Related-party loan concentration: 4.73% of the total loan book (Dec 2023, Rp596,217M against Rp12,591,500M gross loans, per the bank's own disclosed percentage) vs. 3.96% (Sep 2023, per the 9M 2023 post) vs. 5.53% (Dec 2022) - the borrower-level breakdown reappeared this quarter (a reversal from 9M's aggregate-only disclosure) and shows why the aggregate barely moved even as Trimegah's Rp100,000M loan was fully repaid: see Beyond the Usual.
- Undrawn loan commitments: Rp2,523,137M (Dec 2023: Rp1,438,848M committed + Rp1,084,289M uncommitted) vs. Rp1,578,886M (Dec 2022) - up 59.8% for the year, still outpacing the 38.1% growth in the drawn loan book, though the gap narrowed from 9M's pace (committed-facility growth was actually the slower half this year, +12.3%, while uncommitted facilities more than tripled, +263.6%).
- KYC-verified digital banking and lending customers: not restated in this quarter's own materials in the same "9.2+ million" framing used at 9M 2023; the FY2023 presentation instead breaks out ecosystem-specific figures (e.g. 590,000 GoPay Tabungan by Jago users, up from 240,000 at June 2023).
- Headcount and branch network: still not disclosed in the filed financial statements' regulatory format, continuing the pattern flagged in the 9M 2023 post; the separate annual-report sustainability section (not the financial statements) does report employee headcount by gender, a disclosure channel not available in the quarterly interim filings this backfill has otherwise relied on.
The Stock More Than Recovers Its Q3 Losses
Bank Jago's shares closed at approximately Rp2,900 on 29 December 2023 (the nearest trading day to period-end), up 43.6% from Rp2,020 three months earlier - reversing most of Q3's decline, though still down 22.0% YoY (from Rp3,720 at 31 December 2022). No stock split has occurred at any point since the company's IPO, so Rp2,900 is the actual nominal price quoted on the IDX at the time. The path there was not a smooth climb: the stock fell to a fresh backfill-low of Rp1,575 in October before rallying 84.1% to its December close, all within the same quarter. That kind of round-trip within a single quarter is large enough on its own (well past the ~30-40% threshold this backfill uses to flag a move) to be worth a dedicated section rather than folding into valuation - a reader relying only on the Sep-to-Dec closing prices would miss that the quarter's real story was a sharp trough and an even sharper recovery, not a steady climb.
The December rally lines up with the numbers this post covers: the conventional bank's second straight improving quarter and NPL hitting a fourth consecutive backfill-best gave the market a cleaner "durable recovery" narrative to price than Q3's fade from Q2's spike had offered. Whether the market re-rated ahead of the actual FY2023 filing (published in March 2024) or reacted to other information isn't something this backfill's data can resolve - only that the price move and the fundamentals moved in the same direction this quarter, unlike Q3's disconnect.
Beyond the Usual
A new related-party borrower appeared the same size as the one that was repaid
PT Trimegah Sekuritas Indonesia Tbk's Rp100,000 million related-party loan - present in every prior filing back to FY2021 - was fully repaid to zero this year. In its place, a new related-party borrower, PT Multifinance Anak Bangsa, appears for the first time at Rp299,983 million (2.38% of the loan book) - roughly the same size as the existing BFI Finance Indonesia loan (Rp296,234 million, 2.35%), and on its own nearly three times what Trimegah's loan had been. Total related-party loan concentration barely moved (4.73%, from 5.53% a year earlier, but that's after Trimegah's exit - the underlying related-party lending relationship didn't shrink, it just changed counterparties) as one related-party borrower relationship was effectively swapped for a larger one. The borrower-level breakdown itself is worth noting: it reappeared in this annual filing after 9M 2023 disclosed only the aggregate figure, the second time in this backfill that borrower-level detail has come and gone between quarters.
Related-party time deposits kept compounding the trend flagged two quarters ago
The H1 2023 post first flagged related-party time deposits jumping from Rp62,086 million to Rp557,000 million within a single half. That trend didn't reverse - it kept growing: related-party time deposits reached Rp581,264 million (14.48% of all time deposits) at year-end, up from Rp62,086 million (2.99%) a year earlier, a 9.4x increase for the full year. The largest single component is Rp514,000 million from "companies with the same ownership as the shareholders" (up from Rp15,000 million a year earlier) - the same-ownership entity category, not an individual insider. Related-party funding at this concentration in the fastest-growing deposit product isn't improper on its own (the bank discloses it plainly, and related-party deposits are a normal feature of a bank whose largest shareholders also control other financial businesses), but a ninefold increase across a single year in the specific deposit category funding an increasingly time-deposit-heavy balance sheet is worth tracking for whether it keeps compounding into 2024.
The Sharia unit's total assets grew even as its financing book shrank 80%, because it redirected the proceeds into securities
The Sharia Business Unit's financing book fell from Rp2,202,599 million to Rp428,551 million over the year (-80.5%, see above), yet its total assets only fell 31.4% (Rp2,403,009 million to Rp1,648,603 million) - because the unit built a Rp980,243 million marketable-securities position from zero. A financing book being wound down and its proceeds parked in securities rather than redeployed into new lending is consistent with a unit that isn't originating new business, holding liquid assets instead while its existing book runs off - itself further evidence for the wind-down read rather than the organic-recovery framing the improved ratios alone would suggest.
Technology capitalization nearly doubled the pace of two years ago
Acquisitions of intangible assets (primarily software and platform development, per the cash flow statement) reached Rp642,538 million for FY2023, up from Rp464,141 million in FY2022 and Rp297,190 million-equivalent levels in earlier years of this backfill - taking net intangible assets on the balance sheet to Rp1,393,406 million, from Rp887,487 million a year earlier (+57.0%). For a digital-only bank, this is where a meaningful share of the deposit growth this year (+45.8%) is ultimately being reinvested - platform and technology capacity rather than physical branch buildout, consistent with the bank's digital-only model.
The stock-option cost that tripled sequentially last quarter fell back this quarter
The 9M 2023 post flagged MESOP» stock-option cost nearly tripling sequentially, from Rp5 billion in Q2 2023 to Rp14 billion in Q3 2023 - a compounding cost warranting scrutiny before being waved off as a non-cash add-back. It didn't keep compounding: the investor presentation shows Q4 2023's ESOP cost falling back to Rp1 billion, taking the full-year total to Rp20 billion against a "normalized" FY2023 PBT of Rp114 billion versus the Rp94 billion actually reported. The concern from last quarter doesn't disappear (128,350,000 option rights were formally granted in June 2023 at a Rp2,150 exercise price, with vesting running through 2027 and a further 121,650,000 shares still to be granted under the same program), but the specific worry that the quarterly cost was accelerating didn't play out in Q4.
Target Valuation Range
Market cap Rp40.18 trillion (~$2.61 billion), ~4.81x P/B, ~555.6x P/E. Bottom line: still overvalued on both an earnings and a book basis, though less extremely than three months ago - the multiple compression this quarter came entirely from the price rally outrunning book-value growth in the wrong direction, meaning the re-rating this quarter actually made the stock more expensive, not less.
Bank Jago's shares closed at approximately Rp2,900 on 29 December 2023, up 43.6% from Rp2,020 three months earlier (see above). At 13,856,250,000 shares outstanding (unchanged since the March 2021 rights issue, and unchanged again this quarter based on flat issued/paid-in capital of Rp1,385,625M), that implies a market capitalization of approximately Rp40.18 trillion (~$2.61 billion).
| Market cap → book value | Q4 2023 |
|---|---|
| Share price (period-end) | Rp2,900 |
| Shares outstanding | 13,856,250,000 |
| Market capitalization | Rp40.18 trillion (~$2.61 billion) |
| Total equity (book value) | Rp8,356,792M |
| Book value per share | Rp603.11 |
| Peer-multiple sanity check | Q3 2023 | Q4 2023 | Change |
|---|---|---|---|
| P/B | 3.36x | 4.81x | up |
| P/E | 417x | 555.6x | up |
P/B»: ~4.81x, using book value» per share of Rp603.11 (Rp8,356,792M total equity ÷ 13,856,250,000 shares) - up from Q3's backfill-low ~3.36x, since the 43.6% price rally this quarter far outran the 1.1% growth in book value. P/E»: using FY2023's actual full-year EPS of Rp5.22 (no annualizing needed for an annual report), the implied multiple is roughly 555.6x - worse than Q3's annualized ~417x estimate, again primarily a price effect rather than earnings catching down to a more reasonable level. A full DCF still isn't appropriate, for the same reason every prior post in this backfill has given: two years of standalone-quarter data show a conventional bank whose best quarter (Q2 2023) still hasn't repeated, even as its two most recent quarters show real, if smaller, improvement, and a Sharia unit whose FY2023 profit came from winding down 80% of its book rather than a genuine scaling of an ongoing business. The peer-multiple read stays the honest one - and this quarter it moved unfavorably, a reminder that the multiple compressing in Q3 was a function of the sold-off price, not because the underlying earnings base had become any more reasonably priced against it.
PT Bank Jago Tbk's published financial statements for the year ended 31 December 2023 (with 31 December 2022 comparatives), the company's 2023 Integrated Annual Report, and its "FY2023 Results Update" investor presentation.