In an industry where “the bigger the better” holds true, being named as one of the biggest banks in Indonesia is quite an achievement. It can strengthen customers’ and investors’ trust, leading to a better financial performance.
But will it have an impact on bank’s presence or coverage in the media? Here at Maverick, we want to look deeper into this by using CIMB Niaga as a case study.
In late April, CIMB Niaga announced that it officially upgraded its status to BUKU IV bank after recording Rp31.26 trillion in core capital. This marked the first time a bank entered BUKU IV category after the Financial Services Authority (OJK) divided banks based on their core capital in 2016.
This news was then confirmed by OJK Banking Supervision II Deputy Commissioner Irwan Lubis on late July, along with status upgrade for other 25 banks.
Considering its coverage in 20 prominent media since January, CIMB Niaga started this year quite well, supported by coverage on its Rp20.6 trillion net profit in 2016. The bank’s coverage peaked again in April with “Forward” brand promise launch. In the same month, the bank also announced its status upgrade to BUKU IV bank, which was picked up by a lot of media.
The coverage took a dive in June, during Ramadan and Eid al-Fitr. This decrease was also faced by other banks in the industry and therefore did not reflect the bank’s poor visibility in the media.
The bank’s coverage soared again in July as the bank geared up PR efforts by holding XTRA XPO event and announcing its H1 financial performance. CIMB Niaga’s claim on its status upgrade was then confirmed by the OJK.
From this point onward, CIMB Niaga has raked more coverage as the media seems to be more interested in the bank as it is a BUKU IV bank now. Sure, the coverage slipped in August, but even then, its total coverage was just slightly lower than the previous peak in April.
A different picture, however, emerges if we compare CIMB Niaga’s coverage with other BUKU IV banks’ coverage. From the January – September period, CIMB Niaga consistently attracted the least coverage among the banks. During its best performance in September, CIMB Niaga booked 80 news articles, even lower than BCA’s worst of 88 news articles in July.
CIMB Niaga also did not fare well in comparison to BUKU III banks, such as PermataBank and Danamon. The bank still gained fewer coverage than PermataBank, except in April and July when they got the same number of coverage. Interestingly, both banks showed a contrasting pattern in H1. Starting Q3, however, CIMB Niaga has started to narrow the gap with PermataBank. Meanwhile, Danamon, a candidate of BUKU IV bank, recorded even fewer coverage than the other two banks.
These findings suggested that CIMB Niaga needs to step up its game to be able to catch up to other BUKU IV banks that have established their positions way ahead of CIMB Niaga.
In the end, bigger core capital and status as BUKU IV bank may not immediately translate to more coverage, but it can help the bank to pull media’s attention to itself. With the current upward trend of CIMB Niaga’s coverage, we believe that the bank still has a lot of potential to score more coverage and improve media performance. [By Sri Mulyati Daumari]