From de-rating to recovery; maintain Buy

Research evidence excerpt

From de-rating to recovery; maintain Buy

Nomura | Bank Rakyat Indonesia 15 June 2026

Company profile

PT Bank Rakyat Indonesia (Persero) Tbk (BBRI IJ) is one of the largest banks in Indonesia. It specialises in small scale and microfinance style

borrowing and lending.

Valuation Methodology

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 and 11.6x 2026F P/E. The benchmark for the stock is the JCI.

Risks that may impede the achievement of the target price

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 may affect the bank’s write-off policies and thus,

credit costs. This would ultimately affect the bank’s near-term earnings, in our view.

ESG

BRI has launched various activities and programs in its contribution towards the global commitments and the national objectives as stipulated in the

Presidential Regulation Number 59 year 2017 which regulates the Implementation of the Sustainable Development Goals. BRI is the Chair of the

Indonesian Sustainable Finance Initiative (IKBI) which aims to help the government’s efforts to achieve the SDGs. BRI prioritizes customers that

offer environmentally friendly products / have environmental certifications. BRI collaborates with Bank Indonesia and the Indonesian Economic and

Trade Office (Kantor Dagang dan Ekonomi Indonesia - KDEI) in Taiwan to organize education sessions for Indonesian migrant workers on

theimportance of cashless remittance transfers.