BMRI
Contact our analyst achmadi
14% UPSIDE, Buy
19th May 2025
Price Rp 5,525
Target Price Rp 6,300
Modest PATMI Growth Amid Rising Interest Expenses
In March 2025, BMRI’s Profit After Tax and Minority Interest (PATMI) grew 3.90% YoY to IDR 55.78 trillion, although it declined 4.13% QoQ. This modest growth was largely due to a 22.42% YoY increase in interest expenses, which partially offset the 11.51% YoY growth in interest income. As a result, Net Interest Margin (NIM) declined to 4.80%, down from 5.27% in Q4 2024 and 5.07% in Q1 2024. In addition, net premium income dropped -21.10% YoY, though this was partially offset by a 34.57% YoY increase in FVTPL income, helping support profitability. We forecast PATMI to rise 5.60% YoY in 2025 to IDR 58.91 trillion, supported by a projected 10.33% YoY increase in Net Interest Income, with NIM expected to improve to 4.87%.
Strong Loan Growth Driven by ESG Commitment
BMRI once again exceeded its internal target for consolidated loan growth, which rose 16.51% YoY to IDR 1,672.43 trillion (target: 10%–12%).. The Commercial segment led with +21.31% YoY growth, followed by the Corporate segment at +19.92% YoY, mainly driven by infrastructure and construction loans, which rose by IDR 13.39 trillion. ESG loan portfolio expanded 11.1% YoY, underscoring BMRI’s commitment to sustainable finance. Sustainable agriculture loans reached IDR 109.3 trillion, contributing 8.4% of the total loan book. We project consolidated loans to grow 11.19% YoY in 2025, in line with management’s internal target.
Asset Quality Remains Manageable
As of March 2025, BMRI’s Gross Consolidated NPL ratio remained stable at 1.17%, unchanged from Q1 2024 and only 5 bps higher QoQ, primarily due to a 23 bps increase in the Micro segment. Meanwhile, the Special Mention Loan (SML) ratio improved significantly to 3.23%, down 21 bps QoQ and 79 bps YoY, signaling improved asset monitoring and early warning systems. We forecast the Gross NPL ratio to decline slightly to 1.15% by year-end 2025, with the SML ratio improving further to 3.03%.
Ample Liquidity with CASA recovery in Sight
BMRI maintained ample liquidity in Q1 2025, underpinned by strong digital user growth:
• New account openings rose 8.70% YoY
• Livin’ users surged 26.2% YoY
As a result, third-party funds rose 11.25% YoY, led by:
• Time deposits: +18.87% YoY
• Current accounts: +5.02% YoY
• Savings accounts: +11.96% YoY
However, the higher reliance on time deposits reduced the CASA ratio by 180 bps YoY to 72.60%. The bank-only LDR stood at 93.45%, within the target range. We project third-party funds to grow 13.49% YoY in 2025, with the CASA ratio recovering to 74.35% and the bank-only LDR easing to 93.16%.
Valuation: BUY, TP IDR 6,300 (+14%)
Based on Q1 2025 results and a multi-stage Dividend Discount Model (DDM), we revise our target price to IDR 6,300, reflecting a 1.94x PBV and 14% upside potential. We maintain our Buy recommendation, supported by sustained loan growth, manageable asset quality, and improving profitability.
In March 2025, BMRI’s Profit After Tax and Minority Interest (PATMI) grew 3.90% YoY to IDR 55.78 trillion, although it declined 4.13% QoQ. This modest growth was largely due to a 22.42% YoY increase in interest expenses, which partially offset the 11.51% YoY growth in interest income. As a result, Net Interest Margin (NIM) declined to 4.80%, down from 5.27% in Q4 2024 and 5.07% in Q1 2024. In addition, net premium income dropped -21.10% YoY, though this was partially offset by a 34.57% YoY increase in FVTPL income, helping support profitability. We forecast PATMI to rise 5.60% YoY in 2025 to IDR 58.91 trillion, supported by a projected 10.33% YoY increase in Net Interest Income, with NIM expected to improve to 4.87%.
Strong Loan Growth Driven by ESG Commitment
BMRI once again exceeded its internal target for consolidated loan growth, which rose 16.51% YoY to IDR 1,672.43 trillion (target: 10%–12%).. The Commercial segment led with +21.31% YoY growth, followed by the Corporate segment at +19.92% YoY, mainly driven by infrastructure and construction loans, which rose by IDR 13.39 trillion. ESG loan portfolio expanded 11.1% YoY, underscoring BMRI’s commitment to sustainable finance. Sustainable agriculture loans reached IDR 109.3 trillion, contributing 8.4% of the total loan book. We project consolidated loans to grow 11.19% YoY in 2025, in line with management’s internal target.
Asset Quality Remains Manageable
As of March 2025, BMRI’s Gross Consolidated NPL ratio remained stable at 1.17%, unchanged from Q1 2024 and only 5 bps higher QoQ, primarily due to a 23 bps increase in the Micro segment. Meanwhile, the Special Mention Loan (SML) ratio improved significantly to 3.23%, down 21 bps QoQ and 79 bps YoY, signaling improved asset monitoring and early warning systems. We forecast the Gross NPL ratio to decline slightly to 1.15% by year-end 2025, with the SML ratio improving further to 3.03%.
Ample Liquidity with CASA recovery in Sight
BMRI maintained ample liquidity in Q1 2025, underpinned by strong digital user growth:
• New account openings rose 8.70% YoY
• Livin’ users surged 26.2% YoY
As a result, third-party funds rose 11.25% YoY, led by:
• Time deposits: +18.87% YoY
• Current accounts: +5.02% YoY
• Savings accounts: +11.96% YoY
However, the higher reliance on time deposits reduced the CASA ratio by 180 bps YoY to 72.60%. The bank-only LDR stood at 93.45%, within the target range. We project third-party funds to grow 13.49% YoY in 2025, with the CASA ratio recovering to 74.35% and the bank-only LDR easing to 93.16%.
Valuation: BUY, TP IDR 6,300 (+14%)
Based on Q1 2025 results and a multi-stage Dividend Discount Model (DDM), we revise our target price to IDR 6,300, reflecting a 1.94x PBV and 14% upside potential. We maintain our Buy recommendation, supported by sustained loan growth, manageable asset quality, and improving profitability.
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