This article first appeared on <a href="https://www.gurufocus.com/news/9014883/pt-bank-negara-indonesia-persero-tbk-ptbry-q2-2026-earnings-call-highlights-record-core-profit-and-strategic-provisioning-signal-longterm-strength?utm_source=yahoo_finance&utm_medium=syndication&utm_campaign=headlines&r=caf6fe0e0db70d936033da5461e60141″ rel=”nofollow noopener” target=”_blank”>GuruFocus.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
PT Bank Negara Indonesia (Persero) Tbk (PTBRY) achieved its highest core profit (PPOP) in five years, reaching 18.5 trillion rupiah, up 14.5% year-on-year, driven by strong growth in net interest income and record fee income.
-
The company’s loan book grew 24% year-on-year, with 85% of growth coming from its core segments (large corporate, enterprise, and government-linked programs), and private sector loan growth outpaced related-party growth.
-
Asset quality is stable and improving, with the loan at risk ratio improving from 11% to 8.1% and the NPL ratio holding steady at 1.9%, while new NPL formation declined 26% year-on-year.
-
The bank maintains a strong liquidity position with an LDR of 87.7% (below the industry average of 91.7%), LCR at 129.8%, and NSFR at 132.3%, providing a buffer against industry-wide funding pressures.
-
Digital engagement is accelerating, with the mobile app ‘Warner’ growing 76% in users (over half new to the bank) and BNI Direct seeing 50% growth in transactional current account balances, indicating a strengthening core funding franchise.
-
The bank’s transformation initiative (BRIF) is now running nationwide, empowering branches to operate like small businesses and focus on growing low-cost funds (CASA), which grew 11.2% year-on-year.
-
Management is proactively building a stronger loan loss reserve buffer (3.8%, 20 basis points higher than peers) by frontloading provisioning, positioning the bank for more sustainable long-term growth.
Negative Points
-
Net profit growth was only 6.6% year-on-year, significantly lower than PPOP growth of 14.5%, due to a deliberate 42.1% increase in provisioning charges, which weighs on short-term profitability.
-
Net interest margin (NIM) declined year-on-year from 3.8% to 3.6%, and the full-year NIM guidance was revised down to 3.3%-3.5% from 3.5%-3.8%, reflecting rising cost of funds and expected withdrawal of Ministry of Finance SAL placements.
-
Cost of third-party funds increased in the second quarter to 2.63% from 2.49% in the first quarter, driven by intensifying industry-wide deposit competition and higher SRB yields/volumes.
-
The bank experienced a 4.1% quarter-on-quarter decline in current account balances, as it deliberately let go of non-transactional, price-sensitive deposits, which could pressure funding costs in the near term.
-
Asset quality in the consumer segment is deteriorating, with NPL, special mentioned loans, and loan at risk ratios trending upward, requiring a more cautious stance and limiting growth in that segment.
-
Total loan growth of 24.4% year-on-year is well above the full-year guidance of 8-10%, and management plans to moderate the pace in the second half, which could slow revenue momentum.
-
The second half of 2026 is expected to be more challenging due to higher-for-longer US rates, central bank actions to stabilize exchange rates, and rising industry loan-to-deposit ratios, all of which are pushing cost of funds higher.
