Recoveries Are Doing the Heavy Lifting on Credit Cost
BRI's 9M 2024 consolidated net income attributable to owners came in at Rp45,064,753 million, up 11.2% YoY per the company's own cumulative framing - a solid-looking headline. But 9M is a nine-month cumulative figure, and BRI's own H1 2024 net income of Rp29,701,853 million is already known and filed. Subtracting it out gives standalone Q3 2024 net income of Rp15,362,900 million - up a more modest 5.44% YoY from standalone Q3 2023's Rp14,571,098 million (itself derived the same way from BRI's 9M 2023 filing). The quarter that actually just happened grew, but at roughly half the pace the cumulative framing implies.
The growth didn't come from revenue. Standalone Q3 Net Interest and Net Premium Income, net, was essentially flat YoY - Rp36,363,870 million versus Rp36,587,803 million, down 0.61% - the first quarter in this series where that line has actually gone backwards year-on-year. Standalone Q3 operating income (Profit from Operations) grew a modest 2.80% YoY to Rp19,500,379 million. Meanwhile standalone Q3 impairment for financial assets rose 20.48% YoY to Rp11,108,302 million from Rp9,219,382 million - a real cost increase, not a shrinking one. What kept net income growing despite flat revenue and heavier provisioning was a sharp fall in other operating expenses (down from a net Rp17,619,470 million drag in Q3 2023 to Rp16,863,491 million in Q3 2024) combined with recoveries of previously written-off loans accelerating hard: Rp7,745,698 million recovered in Q3 2024 alone, up 83.8% YoY from Q3 2023's Rp4,213,858 million. Management's own bank-only disclosure shows net cost of credit (gross Credit Cost after recoveries) falling to 0.93% in the quarter, down from 2Q24's 1.42% and 3Q23's own 1.41% - genuine improvement - even as gross Credit Cost, the number BRI's own FY2024 guidance is actually measured against, stayed at 3.39% cumulative (9M24), still above the "Max. 3%" ceiling BRI set for itself back at Q1.
The Prescription
BRI should keep leaning into what's actually working here: the recovery engine on previously written-off loans is growing fast (Q3 alone up 83.8% YoY, and up 36.1% QoQ per management's own commentary) and is now doing more to shrink the net credit-cost number than any improvement in gross underwriting quality. That's a genuinely repeatable operational lever - collections capability, not luck - and BRI should keep disclosing the net-of-recovery number prominently rather than letting the gross Credit Cost figure alone carry the guidance conversation, since the net figure is closer to what actually hits the P&L once recoveries are booked.
What BRI should stop doing: treating a guidance band as met when the headline metric closest to what a reader would check is still outside it. Three straight quarters of FY2024 now show gross Credit Cost above the "Max. 3%" ceiling BRI itself set - the ceiling was already widened once at Q1 from an implicit tighter starting range, and even against that widened band, 9M24's 3.39% doesn't clear it. Loan growth (8.2% YoY at 9M24) is also still below the 10%-12% FY2024 band, and management's own commentary attributes the shortfall to "Corporate high base effect" with a promise that "4Q24 [is] likely to pick up" - a forward claim that isn't yet backed by a number. A bank this size, guiding this specifically, should either revise the band publicly or show the specific quarter-by-quarter path back inside it, rather than repeating "likely to pick up" for a second straight quarter.
Key Financial Metrics
Standalone quarter ended September 30, 2024 vs. standalone quarter ended September 30, 2023 (consolidated), derived by subtracting each year's already-filed H1 cumulative figures from that year's 9M cumulative filing, unless noted
FX: Rp15,140.00 = USD 1 as of September 30, 2024, per BRI's own filed financial statements' disclosure - a 7.54% Rupiah appreciation from Jun 2024's Rp16,375.00 and a 2.04% appreciation from Sep 2023's Rp15,455.00.
| Metric | Q3 2024 (IDR) | Q3 2024 (USD) | Q3 2023 (IDR) | YoY |
|---|---|---|---|---|
| Net Interest and Net Premium Income, net ("Net Revenue" equivalent) | Rp36,363,870M | ~$2,402M | Rp36,587,803M | ⚠️ -0.61% |
| Operating Income (Profit from Operations) | Rp19,500,379M | ~$1,288M | Rp18,968,333M | ✅ +2.80% |
| Net Income (attributable to owners) | Rp15,362,900M | ~$1,015M | Rp14,571,098M | ✅ +5.44% |
| Net Income (total consolidated, incl. non-controlling interests) | Rp15,466,264M | ~$1,022M | Rp14,652,208M | ✅ +5.56% |
| EPS (basic, attributable to owners, quarterly) | Rp102 | ~$0.0067 | Rp97 | ✅ +5.15% |
| Impairment for financial assets | Rp11,108,302M | ~$734M | Rp9,219,382M | ⚠️ +20.48% (higher is worse) |
Balance sheet: September 2024 vs. June 2024 (QoQ) and September 2023 (YoY), consolidated, as filed (not derived)
| Balance sheet metric | Sep 2024 (IDR) | Sep 2024 (USD) | Jun 2024 (IDR) | QoQ | Sep 2023 (IDR) | YoY |
|---|---|---|---|---|---|---|
| Total Assets | Rp1,961,916B | ~$129,585M | Rp1,977,371B | ⚠️ -0.78% | Rp1,851,965B | ✅ +5.94% |
| Total Loan & Financing (gross, incl. subsidiaries) | Rp1,353,356B | ~$89,389M | Rp1,336,780B | ✅ +1.24% | Rp1,250,715B | ✅ +8.20% |
| Total Deposits (Third Party Funds) | Rp1,362,419B | ~$89,988M | Rp1,389,662B | ⚠️ -1.96% | Rp1,290,286B | ✅ +5.59% |
| Total Equity (incl. non-controlling interest) | Rp329,473B | ~$21,762M | Rp311,731B | ✅ +5.69% | Rp311,534B | ✅ +5.76% |
| Total Cash and Cash Equivalents (per cash flow statement, period-end) | Rp199,876B | ~$13,202M | Rp152,594B | ✅ +30.98% | Rp156,132B | ✅ +27.99% |
Total Deposits fell QoQ as time deposits alone declined 4.6% QoQ under what management calls a "balance sheet optimization" strategy - deliberately trading away more expensive time-deposit funding while CASA kept growing (see Key Operational Metrics below). Total Cash rose sharply on both counts mainly from a reversal in the operating cash flow line: loan disbursement outpaced deposit inflows in H1 (a net cash use), while Q3 alone was a smaller net operating cash drag as deposit and loan flows partially offset.
Key Operational Metrics
Bank-only unless stated; per BRI's own filed financial-ratio table and investor presentation, quarter-alone figures where available (BRI began reporting quarter-alone ratios in its own materials for 2024, rather than the cumulative-only presentation of earlier years)
- CASA»: 64.40% (Sep 2024) vs Jun 2024's 63.43% ✅ and 63.81% (Sep 2023) ✅ - up on both counts, as the balance-sheet-optimization shift out of time deposits and into CASA kept building.
- Loan-to-Deposit Ratio (LDR)»: 89.60% (Sep 2024) vs 87.19% (Jun 2024) ⚠️ and 88.34% (Sep 2023) ⚠️ - up on both counts as management "strategically increased" LDR per its own commentary, trading liquidity headroom for yield.
- Net Interest Margin (NIM), bank-only, quarter-alone: 6.53% (Sep 2024) vs 6.24% (Jun 2024) ✅ and 7.29% (Sep 2023) ⚠️ - up QoQ, still down YoY as a higher-rate funding environment persisted. On BRI's consolidated cumulative guidance basis, NIM» came in at 7.70% (9M23: 8.12%), back inside the FY2024 7.6%-8.0% band after Q2's slight miss.
- ROA» (after tax, bank-only, quarter-alone): 2.91% (Sep 2024) vs 3.14% (Jun 2024) ⚠️ and 3.00% (Sep 2023) ⚠️ - down on both counts.
- ROE» (book value, bank-only, quarter-alone): 17.56% (Sep 2024) vs 20.20% (Jun 2024) ⚠️ but 17.40% (Sep 2023) ✅ - down sharply QoQ as the equity base grew faster than quarterly profit, up slightly YoY.
- CAR» (Total, bank-only): 24.97% (Sep 2024), up from Jun 2024's 23.23% ✅ but still down from Sep 2023's 25.23% ⚠️.
- NPL ratio - gross (bank-only): 3.04% (Sep 2024) vs Jun 2024's 3.21% ✅ and 3.23% (Sep 2023) ✅ - improved on both counts. NPL ratio - net: 0.84% (Sep 2024) vs 0.86% (Jun 2024) ✅ and 0.76% (Sep 2023) ⚠️. On BRI's consolidated basis, gross NPL closed 9M24 at 2.90%, back inside the FY2024 "<3%" band after Q2's 3.05% breach.
- Cost to Income Ratio (CIR), bank-only, quarter-alone: 39.14% (Sep 2024) vs 38.89% (Jun 2024) ⚠️ and 35.28% (Sep 2023) ⚠️ - worse on both counts. On BRI's consolidated cumulative guidance basis, CIR came in at 41.30% (9M23: 41.28%), just inside the FY2024 41%-42% band.
- Credit Cost (bank-only, quarter-alone): 2.94% (Sep 2024) vs 3.17% (Jun 2024) ✅ but 1.88% (Sep 2023) ⚠️ - improved sequentially but still well above the year-ago level. Net Credit Cost (after recoveries), bank-only, quarter-alone: 0.49% (Sep 2024) vs 1.36% (Jun 2024) ✅ and 0.92% (Sep 2023) ✅ - improved on both counts, and now the clearer read of what's actually happening to underwriting costs than the gross figure (see above). On BRI's consolidated cumulative guidance basis, Credit Cost stood at 3.39% (9M24), still above the FY2024 "Max. 3%" ceiling.
- Cost of Fund (CoF), bank-only, quarter-alone: 3.49% (Sep 2024) vs 3.53% (Jun 2024) ✅ but 2.83% (Sep 2023) ⚠️ - essentially flat QoQ, still up sharply YoY as the tight-liquidity environment persisted through the year.
Business Lines: Loan Growth and Credit Quality
Consolidated, YoY as of 9M24, per BRI's own investor presentation - the same five-way Micro/Consumer/Small/Medium/Corporate scale used since [9M 2023](/analysis/bbri/2023-09/#business-lines-loan-growth-and-credit-quality)
Micro loans grew 6.4% YoY (+Rp37.6 trillion), decelerating further from Q2 2024's 7.8% as management continued to deliberately throttle micro lending. NPL kept worsening to 3.03% from Q2's 2.95% and 9M23's 2.41% - now the segment's fourth straight quarter of credit-quality deterioration in this series even as its own growth keeps slowing, the one segment moving the wrong way on both counts at once.
Consumer grew 10.0% YoY, decelerating slightly from Q2's 11.5%. NPL actually improved to 2.08% from Q2's 2.13%, essentially flat against 9M23's 2.10% - a segment holding its credit quality steady while growth cools only modestly.
Small grew just 1.1% YoY (+Rp2.4 trillion), decelerating further from Q2's already-weak 2.0% and now barely growing at all. NPL improved to 4.64% from Q2's 5.05%, though still up from 9M23's 4.58% - a genuine sequential repair, but still BRI's single worst-performing core segment by NPL level.
Medium grew 24.6% YoY (+Rp8.3 trillion), decelerating from Q2's 31.6% but still the fastest-growing segment. NPL worsened to 1.94% from Q2's 1.75%, though it remains well below 9M23's 2.16% - still BRI's best-performing segment by NPL level even with this quarter's sequential uptick.
Corporate grew 16.9% YoY (+Rp35.8 trillion), decelerating sharply from Q2's 29.2% on what management's own commentary calls a "high base effect" from last year's rapid growth. NPL improved to 2.52% from Q2's 3.07% and 9M23's 4.66% - the segment's multi-quarter credit-quality repair continuing even as its growth pace normalizes from an unusually fast prior year.
Segment Comparison
Consolidated total loan growth (loans plus Sharia financing and finance receivables) came in at 8.2% YoY, below BRI's own 10%-12% FY2024 guidance band for a second straight quarter and the slowest pace in this series' recent run. Every one of the five segments decelerated this quarter versus Q2 - the deceleration is broad-based, not concentrated in one business line, though Corporate's slowdown (29.2%→16.9%) is the sharpest in absolute terms, consistent with management's own base-effect explanation. On credit quality, the picture splits cleanly: Small and Corporate both improved sequentially, driving the consolidated NPL ratio's 15-basis-point QoQ improvement to 2.90% per management's own framing, while Micro and Medium both worsened QoQ - Micro continuing a longer deterioration, Medium giving back some of its multi-quarter improvement from a still-strong base. Consumer stayed the most stable segment on both growth and credit quality this quarter.
Beyond the Usual
This quarter's source documents are BRI's unaudited OJK-format published financial report for the period ended September 30, 2024 - a bare regulatory statement with no notes to the financial statements - alongside its 9M24 investor presentation. As with prior 2024 quarters, neither document carries footnote-level detail (related-party notes, commitment schedules, segment income notes), so this section stays focused on what a standalone-quarter reconstruction and management's own commentary actually reveal.
Recoveries, Not Better Underwriting, Are Driving the Net Credit Cost Improvement
Bank-only net cost of credit (after recoveries) fell to 0.49% in Q3 2024 alone, the best reading in this series' recent run - but the improvement is a recoveries story, not an underwriting one. Gross Credit Cost, the metric BRI's own FY2024 guidance is actually measured against, stayed at 3.39% cumulative through 9M24, still above the "Max. 3%" ceiling set at Q1 and still elevated on a quarter-alone bank-only basis (2.94%) versus a year ago (1.88%). Recoveries of written-off loans in Q3 alone grew 83.8% YoY to Rp7.75 trillion - a collections-driven number, not evidence that new loans are being written more conservatively.
Loan Growth Guidance Miss Widened for a Second Straight Quarter, With an Unconfirmed Rebound Promised
Total loan growth of 8.2% YoY at 9M24 sits below BRI's own 10%-12% FY2024 band, and the gap hasn't closed since Q2. Management's own commentary attributes the miss to a "Corporate high base effect" and states "4Q24 [is] likely to pick up" - a forward claim with no specific number or plan attached in this quarter's own materials. Every one of BRI's five loan segments decelerated this quarter (see Business Lines above), so the shortfall isn't isolated to the one segment management's explanation points to.
A Subsidiary's Provisioning Jump Is Doing More of the Consolidated Credit-Cost Work Than the Headline Suggests
Management's own strengths-and-challenges commentary discloses that PNM's (BRI's micro-lending subsidiary within the Ultra Micro group) gross cost of credit rose 300 basis points QoQ to 5.55% in Q3 2024, attributed to PNM "front-loading" provisions - a subsidiary-specific move that isn't broken out anywhere in the consolidated headline ratios, which blend it with the much larger bank-only book.
BRI's Own Reporting Basis for Consolidated Ratios Changed Mid-Year
A footnote to BRI's key-ratio table discloses that, in compliance with OJK regulation, its calculation of consolidated financial ratios moved from a quarterly to a monthly basis starting January 2024, with both 2024 and 2023 figures adjusted to the new monthly-averaging method for comparability. This is a genuine measurement-basis change mid-series, not something this quarter's headline numbers call out on their own.
A Ultra Micro Segment Reclassification Shaved a Few Basis Points Off Reported Micro Growth
BRI's own presentation discloses that Bank Raya (part of the Ultra Micro group) shifted roughly Rp730 billion of loans from its Small segment into Micro during the quarter, and notes that adjusting for this reclassification changes the reported loan-growth figures by about 20 basis points - a small effect, but worth knowing before reading too much into either segment's exact growth number this quarter.
Target Valuation Range
~12.26x P/E, ~2.32x P/B. Bottom line: BRI still looks cheap relative to BCA on both P/E and P/B, but the gap reflects the two banks' own recent price paths more than a clean fundamentals divergence - and with gross Credit Cost and loan growth both still outside their own FY2024 guidance bands, the discount isn't yet fully explained by a growth or asset-quality edge on BRI's side.
Trailing-twelve-month EPS of approximately Rp404 (summing standalone Q4 2023 through Q3 2024 - Rp16,107.256 + Rp15,885.516 + Rp13,816.337 + Rp15,362.900, all in billions, divided by 151,559,001,604 shares) against the Rp4,950 close gives a P/E» of approximately 12.26x - up modestly from Q2 2024's ~11.50x, as the 7.6% QoQ price gain outpaced trailing EPS growth.
Book value per share is approximately Rp2,134 (Rp323,379,412 million total equity attributable to owners ÷ 151,559,001,604 shares outstanding, unchanged since Q3 2021).
| Market cap → book value | Q3 2024 |
|---|---|
| Share price (period-end) | Rp4,950.00 |
| Shares outstanding | 151,559,001,604 |
| Market capitalization | ~Rp750,217B (~$49.55B, using this quarter's disclosed Rp15,140.00/USD rate) |
| Total equity attributable to owners (book value) | Rp323,379B |
| P/B» | ~2.32x |
| Peer-multiple sanity check | Q2 2024 | Q3 2024 | Change |
|---|---|---|---|
| P/E» | ~11.50x | ~12.26x | ⚠️ up modestly - 7.6% QoQ price gain outpaced trailing EPS growth |
| P/B» | ~2.28x | ~2.32x | ⚠️ up modestly - roughly tracking the quarter's price move |
BBCA's own Q3 2024 post reported a trailing P/E of ~23.9x and a P/B of ~4.98x, using a comparable trailing-four-quarter methodology - a gap to BRI's ~12.26x and ~2.32x of roughly 11.6x on P/E and 2.66x on P/B, both gaps narrower than Q2 2024's ~12.3x and ~2.80x as BRI's own share price recovered somewhat faster than BCA's this quarter. A gap this size is worth treating as a potential value opportunity only if BRI's own credit quality and loan growth genuinely aren't behind the market's discount - and with gross Credit Cost still above its FY2024 ceiling and total loan growth still short of its FY2024 floor (see Beyond the Usual), that case still isn't fully made this quarter either.
A full DCF still isn't included here, for the same reasons every prior post in this series has given - the peer-multiple read above remains the more reliable lens until a longer run of genuinely clean, comparably-consolidated quarters builds up around this one.
PT Bank Rakyat Indonesia (Persero) Tbk's unaudited OJK-format published financial report as of September 30, 2024 and for the nine months then ended, and its 9M24 investor presentation.