Message from CEO


PT Sarana Multigriya Finansial (Persero) carries a mission from the government to disburse funds from the capital market to mortgage lenders. The objective is to enhance acceleration of mortgage volume in Indonesia as an effort to increase capacity and sustainability of home financing so that it is affordable by the people, especially those in middle to lower society. Fund flow activity is carried out in two ways, first is by facilitating securitization program for mortgage lender, and secondly is by providing financing facility for mortgage lender that funded by debt securities issuance. Those two programs are the Company’s main activities.



As part of the world economic community, Indonesia’s economic performance is also affected by the global economic condition. In 2017, the global economic condition began to show a number of improvement. This was marked by the economic improvement in developed countries and the strengthening of economic role of developing countries.

China and the United States which became the motor of global economic growth in 2017 managed to record positive economic growth. After continuously depressed over the past 7 years, China’s economic growth in 2017 grew by 6.9%, higher than the economic growth in previous year, which was 6.7%. Likewise, the United States achieved 2.3% economic growth in 2017 when in previous year, it only achieved economic growth of 1.5%.

Economic improvement in developed countries has increased the demand for global products and supported the economic performance of developing countries, including Indonesia. In 2017, Indonesia’s economic growth was well maintained and increased by 5.07% compared to 5.02% in previous year. Consumption spending that contributed an average of 64.0% to Indonesia’s GDP remained a major contributor to the economic growth.

Several economic indicators that supported Indonesia’s economic growth in 2017 include: the downward trend in inflation, rupiah exchange rate was relatively stable in the range of IDR13,400/USD, as well as the performance of international trade which increased along with the improvement of commodity prices. Bank Indonesia also released its monetary policy amid the global normalization. Cumulatively, the benchmark interest rate fell by 50 bps from 4.75% to 4.25% at 25 bps respectively in August and September 2017. Indonesia also received an investment grade rating from international rating agencies and Indonesia’s banking outlook increased from stable to positive.

The quality of economic development in Indonesia was also supported by the confidence of foreign investors in the Indonesian economy. Currently, Indonesia’s sovereign debt rating has been categorized as investment grade by three international rating agencies after Standard & Poor’s (S&P) upgraded Indonesia’s sovereign debt to BBB- with a stable outlook on May 19, 2017. This upgrade followed the improved ratings previously given by ratings agency, Moody’s and Fitch. Moody’s credit rating for Indonesia was Baa3 with a positive outlook set last on February, 8 2017. Meanwhile, in the latest development in 2017, Fitch upgraded Indonesia’s credit rating one notch to BBB with a stable outlook on December 20, 2017.

The improved Indonesian economy also affected the demand for housing finance. Mortgage increased from 7% in early 2017 to 11.0% in November 2017. Meanwhile, NPL ratio of Mortgage was relatively stable at the range of 2.8%.


In 2017, PT Sarana Multigriya Finansial (Persero) continued to drive the pace of its business growth. Moreover, the macroeconomic condition in 2017 was quite supportive for the Company to improve its business growth acceleration.

One of the steps taken by the Company in 2017 was to launch Regional Development Banks Mortgage Standard Operating Procedures (SOP) and Sharia Home Ownership Financing Standard Operating Procedures (SOP) as a follow-up to the issuance of Presidential Regulation No. 101/ 2016 on Secondary Mortgage. The establishment of Sharia PPR SOP was in line with the Government’s policy to develop sharia-based housing finance schemes that can be traded in the capital market. The scheme development was conducted by empowering the housing finance players, either in primary market with the issuance of standardized mortgage or in the secondary market with mortgage securitization, therefore, it was expected that a low cost and affordable housing finance system for MBR and sustainable could be created.

For the Company, the objective of Sharia PPR SOP is to strengthen the strategic role of Sharia PPR distributors in increasing the volume of PPR distribution to meet the needs for decent housing for the people.

In addition, the Company also continues to enhance cooperation with the Regional Development Bank as partner in disbursing mortgages to the people. The Company has established cooperation with almost all Regional Development Banks in Indonesia. Throughout 2017, the Company conducted capacity building and training for several Regional Development Banks to improve its mortgage disbursement. The effort was made to increase asset securitization.

In 2017, the Company also began to run the Company’s Mortgage (KPR-SMF) program, which was collection of a number of qualified mortgages from several Regional Development Banks. It is expected that soon in the future, the number of such mortgage can be securitized by the Company.

In 2017, another important matter for the Company, was its preparation for digital transformation. The Company is revamping its information technology system to support the Company’s business development in the future.

As we know, the Company is partnering with banks and financial institutions that have qualified IT system. With such digital transformation, the Company’s IT system is expected to “communicate” better with its IT partner system.


In 2017, the Company still faced the same challenge as previous years, which was how to obtain long-term funds with competitive interest rates so that the Company can continue to provide mortgage financing to its partners with competitive interest rates. The Company expects that the Indonesia’s debt rating upgrade to BBB in 2017 will encourage fresh foreign capital inflow in long-term investment on bonds issued by the Company.

Another challenge faced by the Company in 2017 was the reluctance of banks to release their assets for securitization, especially the national conventional banks. Most of the national conventional banks preferred to hold their assets in order to pursue the improvement of the bank category in the bank business group at Bank Indonesia.

In facing these challenges, the Company intensified its cooperation with Regional Development Bank and multifinance to encourage them to promote their mortgage products. The Company did not only provide funding, but also assisted Regional Development Banks and multifinance in preparing SOP for selling mortgage products.

The Company’s effort in issuing KPR BPD SOP and Sharia PPR SOP was a step taken by the Company to improve the quality of bank mortgage assets. The Company has faced obstacles in the form of uneven quality of mortgage assets owned by banks, which was due to differences in standards imposed by banks for mortgage disbursement.


To support its business activities, especially loans, the Company issued debt securities in the form of bonds, Medium Term Notes (MTN), and Sukuk. In 2017, the Company issued debt securities in the forms of bonds with continuing scheme and diversification of funding by using sharia scheme through the issuance of Sukuk Mudharabah with details as follows:


The Company’s performance indicators in 2017 were at an excellent level. Almost all of the targets set out in the Company’s 2017 Work Plan and Budget were achieved. In the case of funds disbursement, throughout 2017, the Company had 2 (two) types of loan programs for mortgage lenders institutions, which were KPR Refinancing and KPR Repo program (Term Purchase Program). In 2017, the Company provided loan facilities to mortgage lenders amounting to IDR11.10 trillion or an increase of 33.43% compared to the position in 2016 which reached IDR8.32 trillion. The achievement was equivalent to 116.14% of the set target for RKAP of IDR9.56 trillion in 2017.

In the case of securitization, in 2017, the Company has securitized various KPR receivables assets amounted to about IDR8.16 trillion or increased by 13.98% compared to securitization achievement in 2016 of IDR7.16 trillion.

In more detail, the achievement of the 2017 target is as follows: (In billion IDR)

Realization of total assets to 2017 target of 108.06% mainly came from the realization of new loan disbursement in 2017 amounting to IDR7,239 billion from the target of IDR5,700 billion.

Realization of total liabilities to 2017 target of 117.59% mainly came from the realization of new debt securities issuance in 2017 amounting to IDR4,177 billion from the target of IDR3,500 billion.

Realization of total equity to 2017 target of 100.04% mainly came from the realization of net profit in 2017 amounting to IDR397 billion from the target of IDR359 billion.

Realization of total income to 2017 target of 110% mainly came from the realization of loan disbursement interest income due to the realization of new loan disbursement in 2017 amounting to IDR7,239 billion from the target of IDR6,700 billion Realization of net income to 2017 target of 111% mainly came from the realization of net interest income of new loan disbursement with debt securities interest of more than IDR48 billion compared to the target.


Indonesia’s economic condition in 2018 is expected to experience better growth compared to 2017. The Government estimates an economic growth of 5.4% while Bank Indonesia projects a more conservative economic growth of 5.26%. Continued improvement of economics in the developed countries is expected to boost demand for commodities, especially those from the developing countries. In preparing the business prospects for 2018 fiscal year, the Company also considers these external factors.

From the industry side, the potential demand for KPR and KPA is expected to increase, supported by the increasing number of housing needed every year. This can be seen from the housing backlog which reached 7.6 million in 2014 and 3.4 million houses in damaged or uninhabitable condition (source: Ministry of Public Works and Housing). The number of backlogs will potentially increase as Indonesia’s population grows by around 305.65 million in 2035 as well as an increase in urbanization. In addition, the need for housing is more urgent as the number of households in Indonesia reached 65.59 million households in 2015 or grew by 1.3% over the previous year. On the other hand, the Government has targeted the reduction of backlogs to be around 5 million in 2019 as stated in the Medium-Term Development Plan (RPJM).

Considering the above factors, the Company has set better performance targets compared to 2017. In addition to support from external conditions, the Company’s internal strengths, namely experiences and its improved performance track record in the recent years will be key factors of the Company’s achievement in 2018.


As the Board of Directors commitment to HR development, the Company, assisted by Consultant, has prepared the Road Map of Human Capital Management System for the period of 2017-2019 aiming to integrate strategies, processes, and systems that can support HR development and management more optimally.

The focus of HR development in 2017 was HR according to the road map, among others:

  1. Competence Management

       Currently, the Company has already had model, dictionary, profile of job position competence, and assessment of soft competency and technical competency prepared together with                             consultant. This updating process involved the entire Subject Matter Expert of the Company, namely representatives of Division Heads and Section Heads in focus group discussion.

  1. Performance Management

         The updating of policies, processes, and performance appraisal application systems that were able to drive employee productivity to be in line with the Company’s target achievement strategy

  1. Corporate Culture

       The Company has worked together with Consultant to redefine the corporate values in accordance with the current condition, where the values have been disseminated to all Employees. In               addition, the internalization programs of the new corporate values were also implemented which aims to shape the employee behavior according to the new corporate values.

       The Company is also in the Completion of Competence Management of Organizational Development in line with the plan of organizational structure change in 2018.



Business development undertaken by the Company remained to be done by prioritizing the prudential principles. Therefore, risk management aspect became one of the main concerns for the Company.

In 2017, the Company made an update on Risk Management Policies and Procedures which one of them regulates the implementation of ISO 31000 in the practice of Risk Management at the Company. In addition, starting from 2017, the Company adopted four eyes principles in underwriting process or feasibility analysis in lending. With the implementation of four eyes principles, the risk management function is further empowered by providing a risk opinion in the credit analysis process.

With the implementation of four eyes principles, the potential credit risk is expected to be more controlled considering the credit analysis process is done by 2 independent functions. It is also expected that the Company can provide credit to larger mortgage lenders including Regional Development Banks and multifinance companies.



In 2017, the Company established GCG implementation in its 2017 RKAP. In realizing RKAP, the Company implemented GCG gradually through performance improvement based on the recommendation of the assessment result by Independent Appraiser in 2016, PT Kharisma Integrasi Manajemen (KIM Consult).

The performance improvement process was carried out by all work units consistently and thoroughly starting from the process of planning, implementation, to administrative activities adjusted to the regulations and internal provisions of the Company.

In 2017, the Company re-conducted GCG assessment as a manifestation of Minister of Finance Regulation No. 88/PMK.06/2015 regarding the Implementation of Good Corporate Governance in Limited Liability Company (Persero) Under the Development and Supervision of the Minister of Finance, which was done by Multi Utama Indojasa (MUC), and the Company succeeded in obtaining a GCG assessment score of 81.179 with a good predicate of the total weight of the rating of 97.874 (minus the Indicator stated not applicable by the Assessors). The Company has increased its score from 2016, which was 79.87 with good predicate.



PT Sarana Multigriya Finansial (Persero)/the Company as one of the SOEs under the Ministry of Finance must implement Partnership and Community Development Program (PKBL) in accordance with the prevailing rules and regulations, by prioritizing Efficient and On-Target principles; PKBL fund channeling must be beneficial to the people in need. To achieve this, the Company has established a PKBL Team with duties to conduct field surveys, guidance, and monitoring of funds that have been distributed.

Throughout 2017, the Company implemented Community Development program prioritizing on activities related to the housing sector, such as construction of toilets, clean water supply, school renovation, as well as construction of public and religious facilities/infrastructure. In addition, the Company continued to undertake “human” development programs, such as scholarships for orphans and underprivileged children, provision of nutrition and health assistance, provision of assistance to victims of natural disasters, training/education on Healthy & Clean Lifestyles (PHBS), psychological education for street children on an ongoing basis, as well as other non-physical programs.



The Deed of Shareholder’s Resolution in lieu of Meeting No. 70 and the receipt of registration to the Minister of Law and Human Rights No. AHU-AH.01.03-0149891 dated July 4, 2017 confirmed the composition of the Board of Directors of PT Sarana Multigriya Finansial (Persero) in which Mr. Trisnadi Yulrisman appointed as the member of the Board of Directors, having previously served as Acting Director of the Company.

Therefore, the Company’s composition of the Board of Directors is as follows:


SMF has succeeded in going through 2017, a fully challenging year, with sufficient performance achievement. The success will be a very valuable capital for the Company to continue to grow in a sustainable manner and be ready to face various business environment conditions that will occur in the future.

Upon achieving good performance, the Board of Directors gives high appreciation to all of the Company’s management and employees for their hard work and dedication to enable the Company SMF in giving its best performance. The Board of Directors would also like to thank the Shareholders and the Board of Commissioners for the support and directions that have been given.

The Board of Directors also expresses appreciation and thanks to all partners and customers who have become very important part in the process of achieving the Company’s performance. We hope that this good cooperation will continue in the coming years.

Jakarta, April 2018

Ananta Wiyogo

President Director