Company Update / Banks / IJ / Click here for full PDF version
Author(s): Jovent Muliadi ; Axel Azriel
- 1H26 net profit of Rp10.8tr (+7% yoy) came in-line. PPOP was robust (+14% yoy) from solid NII/non-II. CoC stood at 1.1% (+10bp yoy).
- NIM fell -20bp yoy to 3.6% in 1H26 on lower loan yield. However, qoq NIM stood flat despite increase in CoF by +14bp qoq.
- Asset quality was improving with decline in LAR at 8.1% vs. 8.6% in 2Q25, along with lower write-offs (-44% yoy). remains one of our top picks.
2Q26 results: in-line as robust PPOP was offset by CoC
posted net profit of Rp10.8tr in 1H26 (+7% yoy/-10% qoq in 2Q26), in-line with our/consensus FY26F at 51%. PPOP came solid at +14% yoy on robust NII (+14% yoy) and non-II (+12% yoy). Opex came higher at +13% yoy amid deliberate front-loading of personnel expenses (FY26F opex growth still kept at 7-8% yoy). Provision grew +42% yoy (+23% qoq), leading to CoC of 1.1% (+10bp yoy/qoq), in-line with FY26F guidance of 1.0-1.2%.
Flat NIM on qoq basis though FY guidance was revised down
Overall NIM fell by -20bp yoy to 3.6% in 1H26, driven by lower loan yield at -40bp yoy though CoF has improved by -22bp yoy. On qoq basis, NIM stood flat in 2Q26 as loan yield remained steady qoq despite higher CoF of +14bp qoq. Nevertheless, revised its FY26F NIM guidance to 3.3-3.5% (from 3.5-3.8%) as it expects funding cost to remain elevated in 2H. Deposit grew +22% yoy, underpinned by TD growth of +51% yoy vs. of +11% yoy with CA grew +12% yoy vs. SA of +10% yoy.
Solid loan growth across segments
Loan growth reached +24% yoy in 2Q26 (+5% qoq) - 17% yoy ex Agrinas, exceeding FY26F guidance of 8-10%. Growth was strong across segments, led by middle at +62% yoy, followed by corporate at +25% yoy from Agrinas-related loans, and SME non-KUR (+16% yoy). Meanwhile, consumer loan grew more modest at +9% yoy, weighed down by lingering asset quality issues.
Asset quality improved along with lower write-offs
LAR improved to 8.1% in 2Q26 vs. 8.6% in 1Q26 (11% in 2Q25), along with stable qoq/yoy NPL at 1.9%. LAR coverage was broadly stable at 47% in 2Q26 vs. 46%/43% in 1Q26/2Q25. In addition, write-offs fell by -44% yoy to Rp4.5tr in 1H26 (vs. Rp7.9tr in 1H25), while the recovery/write-off ratio improved to 56% (vs. 29% in 1H25). This indicates that the higher CoC was mainly a precautionary move rather than being driven by deteriorating asset quality.
Maintain Buy from robust PPOP and attractive valuation
We maintain Buy for and it remains one of our top pick for the sector as we think its robust PPOP and conservative CoC remains underappreciated by the market. currently trades at an attractive valuation of 0.7x FY26F P/B and 6.4x P/E (vs. 10Y avg of 1.1x and 10.1x). Risk is worsening asset quality.
Sumber : IPS