Bank Central Asia (BBCA.IJ Rp7,500; BUY TP Rp11,400) FY25 Results: Improving Asset Quality and CASA Deposit to Navigate the Lower Loan Yield in FY26F

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Bank Central Asia (BBCA IJ)

FY25 Results: Improving Asset Quality and CASA Deposit to Navigate the Lower Loan Yield in FY26F

BBCA booked NP of Rp14.1tr in 4Q25 bringing its FY25 NP to Rp57.5tr (+5% yoy), slightly above our estimate but in line with consensus.
Management expects a higher loan growth of 8-10%, lower NIM of 5.4-5.6%, stable CoC of 40-50bps, and improving consolidated CIR at 31-33%.
Maintain BUY with a higher TP of Rp11,400 taking into account the higher FY26F ROE as we adjusted FY26 earnings by +5% from lower opex.

Steady bottom line amid declining NIM in 4Q25

BBCA booked net profit of Rp14.1tr in 4Q25 (–2% qoq, +3% yoy), supported by lower-than-expected opex and credit costs despite seasonal cost pressures. Non-interest income rose 1% qoq, driven by a 10% increase in fees and commissions, offsetting weaker trading and loan sale losses. Opex increased 8% qoq but remained efficient yoy, bringing CIR to 35.7% (vs. 33.2% in 3Q25 and 38.6% in 4Q24). NIM declined 8bps qoq to 6.0% due to lower EA yield amid stable CoF. Loans grew 5% qoq, driven by corporate loans (+10%) offsetting flat consumer loans. Customer deposits rose 4% qoq on stronger CA and SA, lifting the CASA ratio to a record 84.1%.

Robust CASA-driven deposit and corporate loan growth

For FY25, BBCA recorded net profit of Rp57.5tr (+5% yoy), slightly above our estimate (102% of FY25F) and in line with consensus, supported by lower CoC. NIM declined 25bps yoy to 6.1% due to pressured loan yields despite stable funding costs. TPF grew 10% yoy to Rp1,249tr as CASA rose 13% yoy and TD declined 3%, while loans expanded 8% yoy led by corporate (11%), commercial (8%), and Sharia (23%) segments. CoC increased 18bps to 0.4% as provision expenses rose 97% yoy amid higher write-offs, which doubled to Rp7.7tr. Despite this, asset quality remained resilient, with NPL stable at 1.7% and LaR improving to 4.7%.

Improving loan growth and efficiency to offset the lower NIM

Management guides FY26 loan growth of 8–10%, NIM at 5.4–5.6%, CoC at 0.4–0.5%, and consolidated CIR of 31–33%, supported by fee income growth and improved funding mix. The bank will remain selective in SME, mortgage, and auto loans, while continuing to grow corporate lending and non-retail CASA through new myBCA business products.

Maintain Buy with a higher TP of Rp11,400

We maintain our Buy rating with a higher TP of Rp11,400 (from Rp10,800 prev.), derived from GGM with a 5-year avg. 6.8% CoE and higher FY26F ROE of 20.8%, which implies an FV PBV of 4.7x. Tactical (3M) view: OW. Despite overhang in country risk and persistent foreign outflow, we see limited downside in valuation which is already below -2SD in term of implied CoE and PBV. Risks to our view include asset quality deterioration and stagnating CoF.

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