Bank Rakyat Indonesia (BBRI) Q3 2024 earnings summary

Executive summary

• Indonesian macroeconomic conditions remain stable with 2024 GDP growth projected at 4.9%-5.1% and inflation declining due to falling food prices.

• Pre-provision operating profit (PPOP) grew 15.9% quarter-on-quarter and 10.5% year-on-year, supporting high profitability.

• Net profit for the first nine months of 2024 increased by 2.6% year-on-year to IDR 45.4 trillion, driven by asset quality improvements and PPOP growth.

• Asset quality improved with gross NPL ratio down to 2.9% and NPL coverage at 215.4%.

• The micro, retail, and corporate segments all contributed positively to income and asset growth.

Financial highlights

• Total assets stood at Rp1,961.9 trillion as of September 30, 2024, with consolidated loan growth at 8.2% year-on-year and deposits up 5.6%.

• CASA ratio increased to 64.2%, and cost-to-income ratio improved to 41.3%.

• Non-interest income rose 29.8% year-on-year, while operating expenses increased 11.1% due to amortization and SAP implementation.

• Loan loss reserve remains elevated at 6.2% of total loans, above pre-pandemic levels.

• Net interest income for the nine months was Rp105.76 trillion, up from Rp101.20 trillion year-over-year.

Outlook and guidance

• Loan growth for 2024 is expected at the low end of guidance, slightly below 10%, with Q4 growth anticipated due to base effects.

• NIM is projected to remain within the 7.6%-8% range, and cost of funds is expected to decrease further by year-end.

• Cost of credit guidance for 2024 is maintained at around 3%, with potential for lower credit costs in 2025 if asset quality trends continue.

• Dividend payout ratio could increase to 85% or higher, supported by strong capital levels.

• CIR guidance at 41–42%; 9M24 at 41.3%.