First Read: Bank Rakyat Indonesia "Guidance intact, NIM challenged" (Neutral)

研报英文原文证据摘录

First Read: Bank Rakyat Indonesia "Guidance intact, NIM challenged" (Neutral)

n will be UBS Cons.

repaid timely and in full amount. In our calculation, a 50% lower target could mean 12/26E 361 389

12bp lower NIM. Furthermore, on its Rp50tn ultra micro loans (3.5% loans), there is a 12/27E 366 414

downward repricing from 22% flat to 18% flat (8% customer, 10% government 12/28E 451 459

subsidy) – implying a potential 23bp NIM downside. Uncertainty remains regarding the

implementation timeline and whether the 10% subsidy component will be reallocated Joshua Tanja, CFA

Analyst

from existing interest-subsidy programs, including BRI's KUR portfolio.

joshua.tanja@ubs.com

+62-21-2554 7030

Credit cost outlook in Q226, payout policy outlook 3 years out

Ivan Reynaldo Sutheja

BRI guided that relative to its 3.1% year-to-May credit cost and despite the improvement

in asset quality year to date, there could be upward adjustment for H126 CoC due to a ivan-reynaldo.sutheja@ubs.com

change in Rupiah assumption in its provisioning model under the IFRS9 framework from +62-21-2554 7037

previously Rp16k-17k/USD to cRp18k/USD. It also reiterated group-level minimum CAR

of 20% threshold (from 23% now) and the need to moderate the dividend payout

policies from 90% now to 50-60% when the CAR ratio gets closer to the threshold. For

next year's dividend on 2026E earnings, mgmt. is aiming for a 70% payout. A weaker

macro environment will prompt the bank to focus further on capital and liquidity.

Valuation: Maintain at price target of Rp3,100; Maintain Neutral

We value BRI using a Gordon growth model, assuming a 7% risk-free rate (unchanged),

5.75% equity risk premium (unchanged), cut-off valuation at April 2027 (unchanged),

16.5% sustainable ROE (unchanged), and 8% sustainable growth (unchanged).