Cheapest in the Sector Maintain BUY with TP of IDR 1,600 (0.43x 2026F PBV) on undemanding valuation. BBTN delivered solid 4Q25 earnings results, driven by strong sequential expansion in NII and PPOP, alongside a meaningful improvement in capital adequacy following Tier-1 issuance. Looking ahead, management guides for FY26F loan growth of 8–10% YoY (FY25: 11.9% YoY), deposit growth of 7–9% YoY (FY25: 14.6% YoY), credit cost normalization to 1.0–1.2% (FY25: ~1.6%), and NIM below elevated level (FY25: 4.2%). While part of the FY25 margin uplift was supported by one-off accounting adjustments and CASA growth remaining modest, BBTN’s worse guidance heading into 2026 has us retaining lower EPS growth of just 1.4% (FY25: 16.4%). However, we maintain BUY on BBTN with unchanged TP of IDR 1,600, supported by better funding mix execution, non-housing loan expansion, stronger capital headroom and valuation that remains undemanding relative to history and peers (Figure 2).   1Q26F net profit -28.9% QoQ, -5.7% YoY on lower NIM and higher provisions. Looking ahead, we expect BBTN to book 1Q26 net profit of IDR 852bn (-28.9% QoQ, -5.7% YoY), dragged down by NIM normalization to 7-9% level, higher provisioning at the start of the year, and the absence of one-off income booked in 4Q25. In 4Q25, BBTN posted attributable net profit of IDR 1.2tn (+101% QoQ, +30% YoY), bringing FY25 earnings to IDR 3.5tn (+16.4% YoY), which came slightly higher than our (104%) and consensus (105%) estimates. The strong 4Q25 outturn was driven mainly by a sharp rebound in NII and operating leverage, with FY25 NII surging 57% YoY to IDR 18.4tn, while PPOP jumped 81% YoY to IDR 10.7tn. 4Q25 NIM improved to 4.2% (+30 bps QoQ, +130 bps YoY), supported by higher asset yields and lower cost of funds, although non-interest income declined due to weaker treasury and fee income. Provisioning rose sharply as management proactively rebuilt buffers, lifting FY25 credit cost to ~1.6%, in line with guidance.   Liquidity remains manageable, supported by improving funding mix. We expect FY26F liquidity to remain manageable (LDR: ~93%), supported by healthy deposit growth and a higher contribution from lower-cost middle-institution funding. In FY25, total deposits grew s.15% YoY to IDR 437tn, driven primarily by time deposits (+28% YoY), while CASA grew more modestly at 3% YoY, bringing the CASA ratio to 48.7%. Loan growth reached 12% YoY (+5% QoQ), exceeding management’s original guidance, led by solid expansion in non-housing loans (+38% YoY), particularly corporate and commercial segments. Going forward, management remains focused gradually increasing medium term’s non-housing mix toward ~30%, which should support more balanced growth and margin stability, albeit with near-term funding cost trade-offs.   Assets quality improving, with higher buffers and stronger capital position. We expect FY26F assets quality to stabilize with NPL of ~3.0%, supported by improved mortgage collection and tighter underwriting. In 4Q25, gross NPL improved to 3.1% (vs. 3.4% in 3Q25), while loan-at-risk declined to 19.4%, reflecting early benefits from the new regional cluster strategy. Importantly, NPL coverage increased to ~124%, as management front-loaded provisioning to normalize reserve buffers. Capital strengthened materially following the IDR 2tn Tier-1 issuance, lifting CAR to 20.9% (from 18.6% in 3Q25), with additional capital actions still in the pipeline. While FY25 profitability was partly boosted by accounting adjustments, the stronger balance sheet provides more credible foundation for sustainable growth into FY26.