Bank Negara Indonesia (BBNI IJ)
1Q26 Earnings: Above; Driven by Strong Loan Growth and Better Asset Quality
- BBNI posted a net profit of Rp5.7tr in 1Q26, slightly above our estimate (27%) and in line with consensus (26%).
- Both LaR and NPL ratios declined yoy, although consumer segments remain a key area of concern.
- Maintain Buy rating with an unchanged TP of Rp4,700, implying a fair value PBV of 1.0x.
Robust earnings despite lower NIM
BBNI posted a net profit of Rp5.7tr in 1Q26, slightly above our estimate (27%) and in line with consensus (26%). PPOP declined 1% qoq from 4Q25’s high base but still grew 12% yoy, reflecting resilient core earnings. However, NIM came under pressure amid lower loan yields across segments due to intense competition in wholesale and more selective consumer disbursement, resulting in flattish qoq NII despite strong 20% yoy loan growth. Non-interest income remained robust on a yearly basis (+13% yoy), supported by fee-based income and recoveries, although it declined 21% qoq from a high base.
Higher opex and normalized provisioning amid consumer headwinds
From a cost and asset quality perspective, opex increased 12% yoy (–16% qoq), driven by higher HR expenses and IT spending, partly due to one-off adjustments. CoC rose to 1.1% (+20bps yoy) as the bank normalized provisioning, particularly in corporate (following prior-year releases) and consumer segments. Despite this, asset quality showed improvement, with both LaR and NPL ratios declining yoy, supported by better performance in SME and corporate loans, although consumer segments (mortgage, payroll, and credit cards) remain a key area of concern, prompting additional provisioning buffers amid current macro conditions.
Maintain FY26F guidance unchanged
Loan growth remained strong at 20% yoy, driven primarily by corporate (+23%) and middle segment (+38%). Notably, corporate expansion was heavily supported by SOE-related lending, particularly to Agrinas; excluding this, overall loan growth would be closer to 13%. On the funding side, deposits grew faster at 34% yoy (26% excluding SAL), keeping LDR relatively low at 83%. Management maintained its FY26 guidance, targeting 8–10% loan growth, NIM of 3.5–3.8%, CoC of 1.0–1.2%, and opex growth capped at 7%.
Maintain Buy with an unchanged TP of Rp4,700
We maintain our forecast and Buy rating with an unchanged TP of Rp4,700. Our TP is derived from GGM with a 5-year avg. 12.0% CoE and FY26F ROE of 11.8%, which implies an FV PBV of 1.0. Tactical (3M) view: N. Despite robust results, the stock might see high volatility driven by macro and global uncertainties.
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