3Q25 results: Slightly on the Softer Side

Net profit up +6.5% QoQ, down -10.6% YoY; CoC slightly higher at 1.1%. In 3Q25, BBNI booked consolidated net profit of IDR 5.0tn (+6.5% QoQ, -10.6% YoY), slightly on the softer side of our forecast (71.6%) and consensus (~73.0% of FY25 aggregate estimate). Quarterly earnings gained some traction, supported by 23.3% QoQ increase in NII, underpinned by strong fee-based income (+24.8% QoQ) and recovery income (+19.5% QoQ). However, NIM compressed to 3.6% (-10bps QoQ) as cost of funds peaked at 2.93% before easing in late September. Loan growth accelerated to +10.5% YoY (+4.3% QoQ), led by corporate (+12.4% YoY) and medium/SME non-KUR (+14.3% YoY) segments, while CASA deposits rose +13.3% YoY on continued digital traction. CASA ratio, however, slipped to 65.6% (-640bps QoQ) due to temporary IDR 55tn MoF term deposit. Assets quality remained solid with gross NPL stable at 2.0%, LAR improving to 10.4% (from 11.0% in 2Q25), and CoC inching up to 1.1% as provisions were front-loaded to strengthen buffers in consumer segment.
Accelerating digital CASA and SME, leveraging liquidity tailwinds. Management reaffirmed its strategic focus on strengthening transactional CASA and expanding SME lending to cushion ongoing NIM pressure. The “Wondr” and “BNI Direct” platforms continued to deliver solid traction, recording double-digit growth in users and transactions — with 10.5mn Wondr users (+3.8x YoY), +23% growth in BNI Direct users, and +20% YoY increase in retail savings accounts. BBNI also capitalized on the government’s liquidity placement (IDR 55tn), allocating half to new lending—particularly in manufacturing, telecommunications, resources, and wholesale/retail trades—and the remainder to low-cost liquidity management. This strategy supported gradual reduction in high-cost deposits and provided early signs of easing CoF.
2025F guidance: NIM ~3.7%, loan growth 8–10%, CoC ~1%. Management revised its FY25 NIM outlook to ~3.7% (from ≥3.8%) amid sustained loan-yield competition and temporary CASA dilution stemming from MoF’s term deposit placement, despite continued improvements in funding mix. Loan growth guidance is maintained at 8–10%, while CoC remains at ~1%, supported by prudent provisioning and improving asset portfolio (LAR 10.4%, NPL 2.0%). Assets quality stayed sound with higher provisioning in the consumer segment (NPL: 2.6%) offset by cleanup of legacy exposures (write-offs IDR 11.8tn YtD), keeping NPL coverage robust at 222.7%. The NIM impact from MoF’s deposit is expected to normalize in 4Q25 as more funds are redeployed into loans.
Retain BUY with TP of IDR 4,900 (1.0x PBV) despite slight downside risk on earnings. We believe BBNI’s management continues to execute well on its funding strategy, digital migration, and value-chain lending initiatives, laying the groundwork for more resilient earnings as declining CoF gradually translates into margin recovery. However, despite 2Q25 earnings downgrades amid ongoing NIM pressure and competitive funding environment, there exists slight potential downside risk on full-year earnings due to persistently high CoF, consumer loan asset-quality deterioration, and broader macroeconomic headwinds. Nevertheless, we see upside risks including faster CASA accumulation and stronger-than-expected performance from SME and mid-corporate segments. Thus, we retain our BUY call on BBNI with TP of IDR 4,900/share (1.0x PBV).