Bank Central Asia (BBCA IJ) (Buy) - Resilient YTD Oct-2025 results

Resilient YTD Oct-2025 results

BBCA has released its bank-only Oct-2025 results. Overall, despite challenging macroeconomic conditions, we think the bank continues delivering solid results that are ahead of our FY25 earnings estimates. For YTD Oct-2025, the bank booked a headline profit of IDR48.3tn (+4% y-y) and a pre-provisioning operating profit (PPOP) of IDR62.8tn (+8% y-y). We attribute these results to the following: (1) stable YTD net interest margin (NIM) of 5.8% (flat y-y), largely driven by a slightly higher asset yield of 6.7% (flat y-y), and steady (and lowest among its peers) funding cost of 1.07% (+1bp y-y); (2) an ultra-low (and steady) cost ratio of ~20% (the lowest among major banks; ~40-45% for SOE bank peers), which we credit to the bank’s ongoing investments in technology; and (3) the low credit cost of 40bp (+20bp y-y) compared to its peers, reflecting the bank’s healthy asset quality. The headline y-y profit growth this year appears to be among the highest of the major banks we cover.

With liquidity risks abating, in our view, earnings visibility has improved across our covered major banks. BBCA, too, should benefit from the lower-rate environment as its current accounts and savings accounts (CASA) ratio might remain elevated, while lending rates are likely to stay flattish. In terms of asset yields, the bank remained largely stable at ~7.0%, where changes in the earning asset mix toward more loans offset a slight yield decline, particularly for risk-free earning assets. Meanwhile, on asset quality, management has also highlighted that the bank made some proactive provisioning for some loans in the commercial segment and witnessed a pickup in special mention loans (SML), particularly in the small-to-medium enterprise (SME) and consumer segments, hence boosting provisions. However, YTD Oct-2025 credit costs (CoC) stood at ~40bp – still within management guidance of ~50bp for FY25F (vs 20bp in YTD Oct-24).

On the balance sheet, the bank booked loan and deposit growth of +8% y-y (+3% YTD) and +8% y-y (+6% YTD), respectively, which brought its loans-to-deposits ratio (LDR) to 78% (flat m-m and y-y). We expect loan growth to moderate in subsequent months towards 6-8% (in line with management guidance). A key observation on deposit growth indicates high-quality growth coming from CASA, which rose +10% y-y (+9% YTD). This resulted in a CASA ratio of ~84% (+200bp y-y) in October. On loan-loss reserves (LLR), management maintained its prudent stance, with a stable LLR of 3.4% in Oct-25 (flat m-m; -50bp y-y). This is in anticipation of a potential increase in non-performing loan (NPL) formations.

Valuation and risks

We maintain our Buy rating and TP of IDR12,300. We derive our TP of IDR12,300 using DuPont analysis, with these key parameters: a risk-free rate of 6.5%, an equity risk premium of 7.8%, beta of 0.8x and a CAR-adjusted ROAE of 24.5%. Our TP implies 5.4x FY25F P/B (vs current price valuation of 3.9x) and 26.7x FY25F P/E (vs current price valuation of 19.3x). Risks are worsening economic trends, tighter liquidity competition, and/or higher credit cost and opex growth.

Fig. 3: BBCA monthly results

BBCA - Monthly Results IDRbn	Oct-24	Dec-24	Sep-25	Oct-25	M-M	Y-Y	YTD 2025	YTD 2024	YTD Y-Y	vs FY25F	FY25F
Int income	7,636	7,815	7,602	7,777	2%	2%	76,761	73,365	5%	76%	100,900
Int expense	977	1,010	990	1,030	4%	5%	10,286	9,702	6%	85%	12,135
NII	6,659	6,806	6,612	6,747	2%	1%	66,476	63,663	4%	75%	88,765
PPOP	6,617	5,046	5,561	6,480	17%	-2%	62,765	58,099	8%	83%	75,604
Provisions	(341)	(450)	155	304	97%	-189%	3,122	1,488	110%	67%	4,684
Net profit	5,859	4,234	4,515	4,683	4%	-20%	48,257	46,226	4%	85%	56,719
M-M loan growth	0.8%	2.2%	-0.8%	1.1%
Y-Y loan growth	14.2%	13.6%	7.4%	7.6%
YTD loan growth	9.0%	13.6%	2.1%	3.2%
M-M deposit growth	-0.6%	0.0%	1.5%	0.2%
Y-Y deposit growth	2.4%	2.5%	6.7%	7.6%
YTD deposit growth	1.3%	2.5%	6.2%	6.4%
LDR	78%	81%	78%	78%
NIM	6.0%	6.1%	5.6%	5.7%			5.8%	5.8%
Risk-Adj NIM	6.3%	6.5%	5.5%	5.4%			5.5%	5.7%
LLR	3.9%	3.6%	3.4%	3.4%
Credit cost (CoC)	-0.48%	-0.61%	0.20%	0.40%			0.4%	0.2%
CASA ratio	82%	82%	84%	84%
Monthly CIR	15%	26%	20%	19%
Loan-to-CASA	95%	98%	93%	93%
B/S ROAE (annualised)	28.3%	20.2%	20.5%	20.9%
Risk-adj NIM	6.5%	6.7%	5.4%	5.3%
B/S ROAA (annualised)	5.0%	3.6%	3.7%	3.8%
Asset yield (annualised)	6.9%	7.0%	6.4%	6.5%			6.7%	6.7%
COF (annualised)	1.06%	1.08%	1.01%	1.04%			1.07%	1.06%
CASA Y-Y %	4.3%	4.1%	8.9%	10.3%
PPOP Y-Y %	5.9%	15.7%	-4.3%	-2.1%	M-M	Y-Y	YTD 2025	YTD 2024
Loans	858,062	894,912	913,730	923,541	1%	8%	3%	9%
Deposits	1,096,126	1,108,909	1,177,185	1,179,679	0%	8%	6%	1%
CA	342,257	359,446	400,628	401,240	0%	17%	12%	-1%
Savings	556,849	554,080	586,332	590,497	1%	6%	7%	5%
TD	197,020	195,383	190,225	187,942	-1%	-5%	-4%	-4%
CASA	899,106	913,526	986,959	991,737	0%	10%	9%	2%
Equities	251,032	253,068	267,157	271,782	2%	8%	7%	8%
Total Assets	1,396,684	1,406,330	1,492,607	1,498,655	0%	7%	7%	2%

Source: Company data, Verdhana research

INVESTMENT RATINGS
A rating of ‘Buy’, indicates that the analyst expects the stock to outperform the Benchmark over the next 12 months. A rating of ‘Neutral’, indicates that the analyst expects the stock to perform in line with the Benchmark over the next 12 months. A rating of ‘Reduce’, indicates that the analyst expects the stock to underperform the Benchmark over the next 12 months. A rating of ‘Suspended’, indicates that the rating, target price, and estimates have been suspended temporarily to comply with applicable regulations and/or firm policies. Securities and/or companies that are labelled as ‘Not Rated’ or ‘No Rating’ are not in regular research coverage. Benchmark is Indonesia Composite Index (‘IDX Composite’). A ‘Target Price’, if discussed, indicates the analyst’s forecast for the share price with a 12-month time horizon, reflecting in part of the analyst’s estimates for the company’s earnings, and may be impeded by general market and macroeconomic trends, and by other risks related to the company or the market in general.

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Rating Table

Rating Remains	Buy
Target price Remains	IDR 12,300
Closing price 17 November 2025	IDR 8,575

Research Analysts

Erwin Wijaya (erwin.wijaya@verdhana.id)

Tags: BANKS, Bank Central Asia, BBCA, BBCA JK, BBCA IJ, Erwin Wijaya

Bank Central Asia (BBCA IJ) (Buy) - Resilient YTD Oct-2025 results

Resilient YTD Oct-2025 results

Fig. 1: BBCA YTD Oct-2025 Y-Y performance %

Fig. 2: Major banks’ 12MMA NIM trends

Fig. 3: BBCA monthly results

Fig. 4: BBCA – 12MMA CoC vs 12MMA WO %

Fig. 5: BBCA – LLR vs 12MMA WO %

Rating Table

Research Analysts

yudi Administrator

Bank Central Asia BBCA IJ - Buy - Solid YTD Jul-24 results

Bank Rakyat Indonesia -BBRI IJ- Buy - Towards more commercial micro

Bank Negara Indonesia BBNI IJ - Buy - Operating 1H24 results were below

Bank Rakyat Indonesia -BBRI IJ- Buy - YTD Jul-24 bank only results - steady progress

Bank Rakyat Indonesia -BBRI IJ- Buy - ROAE uptrend on positive micro trends

Bank Central Asia -BBCA IJ- Buy - Steady growth reiterate Buy new TP IDR13200

Bank Central Asia (BBCA IJ) (Buy) - Resilient YTD Oct-2025 results

Fig. 1: BBCA YTD Oct-2025 Y-Y performance %

Fig. 2: Major banks’ 12MMA NIM trends

Fig. 3: BBCA monthly results

Fig. 4: BBCA – 12MMA CoC vs 12MMA WO %

Fig. 5: BBCA – LLR vs 12MMA WO %

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