Bank Rakyat Indonesia (BBRI IJ) (Buy) - May-26 results in-line

May-26 results in-line

BBRI has released its bank-only May-26 results, reporting headline profit of IDR4.5tn (+12% m-m; +24% y-y), bringing YTD May-26 earnings to IDR20.4tn (+10% y-y) — equivalent to ~35% of our FY26F projection and broadly in line with our current consolidated earnings forecast. Nevertheless, the primary area of concern remains the NIM trajectory. April NIM declined meaningfully from ~6.2% in 1Q26 to 5.6%, marking a multi-quarter low and suggesting potential downside risk to our FY26F NIM assumption should the trend continue. In addition, BI’s recent rate hike could reintroduce funding cost pressures going forward. Given BBRI’s sizeable floating-rate micro loan portfolio, asset yields may remain vulnerable to near-term compression, particularly if funding costs reprice upward faster than loan yields adjust.

On asset quality, YTD May-26’s CoC of 3.2% remains below YTD May-25’s 3.4%, suggesting some stabilization in credit costs. However, the monthly CoC uptick to 3.8% in May — despite strong loan growth — indicates that stress within the micro segment, which became evident in 2025, has yet to fully normalize. Meanwhile, the government policy continues to represent a key swing factor. Ongoing KUR (subsidized micro-credit) support and rural lending targets should underpin volume growth, although the structurally lower pricing of KUR loans remains an inherent drag on margins.

Net interest income was at IDR9.1tn (-8% m-m; +3% y-y), bringing YTD May-26 NII to IDR48.5tn (+7 y-y) – accounting for ~30% of our FY26 forecast. The y-y NII growth, however, masks a notable m-m step-down, with May NIM declining to 5.6% from 6.2% in Mar-26 – the sharpest monthly compression observed so far in 2026. Headline PPOP reached IDR10tn (+12% m-m; +26% y-y), bringing YTD May-26 PPOP to IDR44.6tn (+8% y-y) – accounting for ~35% of our FY26 forecast – despite rising cost-to-income ratio (monthly CIR at 42% in May, +400bp y-y).

On the balance sheet, the bank booked loan and deposit growth of +12% y-y (+6% YTD) and +9% y-y (+6% YTD), respectively, which brought LDR to ~92.0% (+300bp y-y). Loan growth was driven by government-related programs (Agrinas, unlisted) and non-bank SOEs. However, we expect loan growth to continue normalizing in subsequent months towards FY26 growth of 7-9% (according to management guidance). Deposits growth came from current accounts (CA) and savings accounts (SA), which rose +25% and +13% y-y, respectively. These, in our opinion, mostly came from the government and Danantara placements.

Valuation and risks

We derive our TP of IDR4,500 using DuPont analysis, with key parameters as follows: a risk-free rate of 6.5%, an equity risk premium of 7.8%, beta of 0.9x and a CAR-adjusted ROAE of 18.0%. Our TP implies 2.1x 2026F P/B (vs 1.8x currently) and 11.6x 2026F P/E (vs 10.1x currently). Risks are worsening macroeconomic trends, unfavorable regulatory changes, and tighter liquidity competition, which could increase funding costs, worsening credit quality which would raise credit costs, and higher opex. Changes in management could affect the bank’ s write-off policies and thus, credit costs. This would ultimately affect the bank’s near-term earnings, in our view.

Fig. 2: Monthly results

BBRI Bank-only IDR bn	May-25	Dec-25	Apr-26	May-26	M-M	Y-Y	YTD-26	YTD-25	Y-Y	% FY26F	FY26F
Interest income	13,361	13,767	13,624	13,266	-3%	-1%	66,769	66,814	0%	30%	219,424
Interest expenses	4,510	3,592	3,711	4,140	12%	-8%	18,263	21,330	-14%	32%	57,812
Net interest income	8,851	10,175	9,913	9,126	-8%	3%	48,506	45,485	7%	30%	161,613
PPOP	7,922	9,347	8,892	9,995	12%	26%	44,595	41,292	8%	35%	126,134
Provision exp	3,377	3,237	3,799	4,424	16%	31%	19,060	17,730	8%	38%	50,647
Net profit	3,637	4,958	4,036	4,526	12%	24%	20,423	18,646	10%	35%	58,694
Comprehensive profit	3,384	5,781	4,216	4,540	8%	34%	19,288	19,723	-2%
MoM loan growth	1.8%	2.8%	1.4%	3.0%
YoY loan growth	5.0%	10.4%	11.0%	12.2%
YTD loan growth	3.9%	10.4%	2.5%	5.6%
MoM deposit growth	1.7%	0.0%	-3.4%	3.3%
YoY deposit growth	1.7%	7.3%	6.8%	8.6%
YTD deposit growth	4.7%	7.3%	2.5%	5.9%
LDR	88.6%	91.9%	91.9%	91.6%
NIM (annualised)	6.0%	6.7%	5.8%	5.6%			6.2%	6.2%
LLR	5.9%	5.4%	5.4%	5.3%			5.7%	6.5%
CoC (annualised)	3.2%	2.9%	3.3%	3.8%			3.2%	3.4%
Risk-adj NIM %	3.7%	4.6%	3.6%	2.9%			3.7%	3.8%
CASA ratio	65%	71%	71%	71%
CIR (annualised)	38%	44%	38%	42%
B/S ROAE (annualised)	15.3%	19.4%	16.3%	19.0%
B/S ROAA (annualised)	2.3%	3.1%	2.4%	2.6%
Asset yield (annualised)	9.1%	9.1%	8.0%	8.1%
COF (annualised)	3.5%	2.8%	2.7%	2.9%
Leverage ratio x	6.6	6.4	7.3	7.2
Cash ratio %	1.3%	1.7%	1.3%	1.3%
LDR %	88.7	92.0	92.0	91.6
Loan-to-CASA %	136.4%	129.7%	129.9%	129.7%
Monthly personnel exp	2,050	1,533	2,098	3,013	44%	47%	12,990	11,228	16%
As % of assets	1.3	1.0	1.2	1.7
3 MMA personnel as % of assets	1.5	1.1	1.5	1.6

Source: Company data, Verdhana research

Fig. 3: Earnings asset and funding breakdowns

BBRI Earnings asset IDRbn	May-25	Dec-25	Apr-26	May-26	M-M	Y-Y	YTD-26	YTD-25
Total	1,779,767	1,822,233	1,966,259	1,962,840	0%	10%	8%	2%
Placements w BI	87,662	39,577	104,998	81,050	-23%	-8%	105%	-28%
Placements with other banks	59,772	53,076	78,552	49,059	-38%	-18%	-8%	28%
Marketable Securities	322,666	357,542	292,261	331,235	13%	3%	-7%	4%
Repo Securities	39,071	29,340	111,093	77,056	-31%	97%	163%	52%
Reverse Repo Securities	7,877	24	2,999	7,242	141%	-8%	29516%	-53%
Loans and receivables	1,262,720	1,342,674	1,376,355	1,417,197	3%	12%	6%	4%
Breakdown	May-25	Dec-25	Apr-26	May-26
Total	100.0	100.0	100.0	100.0
Placements w BI	4.9	2.2	5.3	4.1
Placements with other banks	3.4	2.9	4.0	2.5
Marketable Securities	18.1	19.6	14.9	16.9
c. Held to maturity	-	-	-	-
d. Loans and receivables	-	-	-	-
Repo Securities	2.2	1.6	5.6	3.9
Reverse Repo Securities	0.4	0.0	0.2	0.4
Loans and receivables	70.9	73.7	70.0	72.2
BBRI Funding IDRbn	May-25	Dec-25	Apr-26	May-26	M-M	Y-Y	YTD-26	YTD-25
Total Assets	1,779,767	1,822,233	1,966,259	1,962,840	0%	10%	8%	2%
Deposits	1,423,875	1,460,089	1,496,301	1,546,446	3%	9%	6%	5%
Current accounts	387,216	450,129	455,487	484,904	6%	25%	8%	3%
Savings accounts	538,563	584,893	603,722	607,373	1%	13%	4%	-1%
Time deposits	498,096	425,066	437,091	454,168	4%	-9%	7%	13%
CASA	925,778	1,035,022	1,059,210	1,092,278	3%	18%	6%	1%
Loans/Securities	104,956	72,128	167,061	139,987	-16%	33%	94%	14%
Equities	287,508	299,496	283,132	287,672	2%	0%	-4%	-4%
Breakdown %	May-25	Dec-25	Apr-26	May-26
Total Assets	100.0	100.0	100.0	100.0
Deposits	80.0	80.1	76.1	78.8
Current accounts	21.8	24.7	23.2	24.7
Savings accounts	30.3	32.1	30.7	30.9
Time deposits	28.0	23.3	22.2	23.1
Loans/Securities	5.9	4.0	8.5	7.1
Equities	16.2	16.4	14.4	14.7

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 4,500
Closing price 25 June 2026	IDR 2,850

Research Analysts

Erwin Wijaya (erwin.wijaya@verdhana.id)

Tags: BANKS, Bank Rakyat Indonesia, BBRI, BBRI JK, BBRI IJ, Erwin Wijaya

Bank Rakyat Indonesia (BBRI IJ) (Buy) - May-26 results in-line

May-26 results in-line

Fig. 1: BBRI YTD May-26 y-y performance %

Fig. 2: Monthly results

Fig. 3: Earnings asset and funding breakdowns

Fig. 4: BBRI - 12MMA CoC vs 12MMA WO %

Fig. 5: BBRI - 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 Rakyat Indonesia (BBRI IJ) (Buy) - May-26 results in-line

Fig. 1: BBRI YTD May-26 y-y performance %

Fig. 2: Monthly results

Fig. 3: Earnings asset and funding breakdowns

Fig. 4: BBRI - 12MMA CoC vs 12MMA WO %

Fig. 5: BBRI - LLR vs 12MMA WO %

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