The Baton Passed From Cost To Credit
BRI's standalone Q2 2025 consolidated net income attributable to owners came in at Rp12,603,456 million, down 8.78% YoY from Q2 2024's Rp13,816,337 million - a real decline, but a noticeably gentler one than Q1 2025's 13.93% drop. If the story were simply "profit keeps falling," that deceleration alone would be worth a shrug. It isn't that simple, because the thing actually causing the decline changed completely.
Q1's post named the culprit plainly: operating expense growing 11.7% YoY against roughly flat revenue, while credit metrics actually improved. That problem is gone. Standalone Q2 2025 total operating expense grew just 0.54% YoY - a near-total reversal from Q1's double-digit pace. But impairment for financial assets, which grew a comparatively tame 5.26% YoY in Q1, jumped 16.29% YoY this quarter to Rp10,860,570 million from Rp9,339,288 million. Net revenue (Net Interest and Sharia Income, net) grew a healthy 4.26% YoY to Rp36,357,169 million, and operating income still fell 6.10% YoY to Rp17,383,127 million - the same direction as Q1, for an entirely different reason. BRI didn't fix its profit problem this quarter; it traded a cost problem for a credit problem.
The Prescription
BRI should lock in and extend whatever discipline drove this quarter's opex deceleration - a swing from 11.7% to 0.54% YoY growth in a single quarter is a real result, not noise, and management should say explicitly what changed operationally rather than let it read as a one-quarter fluke that could reverse next quarter. That said, the credit side needs the same scrutiny the cost side just got: a 16.29% YoY jump in impairment expense, arriving in the same quarter Micro segment NPL worsened 91 basis points YoY (2.95%→3.86%, per BRI's own segment-NPL table), is a genuine deterioration that shouldn't be allowed to hide behind a flat-to-improving consolidated NPL headline (3.05%→3.04% YoY).
What BRI should stop doing: reporting Retail as a single blended segment when its own internal profitability swung from a Rp3,537,418 million profit to a Rp1,151,017 million loss in one year (see Beyond the Usual below) without disclosing which product line inside Retail actually drove a 34.6% jump in allocated operating expense. A segment that flips from profit to loss deserves more than a single aggregated line in a footnote table - especially when the swing isn't explained by credit costs at all.
Key Financial Metrics
Standalone three months ended June 30, 2025 vs. standalone three months ended June 30, 2024 (both derived by subtracting the already-filed Q1 figures from each year's H1 cumulative filed statement), consolidated
FX: approximately Rp16,235 = USD 1 as of June 30, 2025, per BRI's own Reuters spot rate used for commitment and contingency translations (no single consolidated spot rate is stated elsewhere in the filing).
| Metric | Q2 2025 (IDR) | Q2 2025 (USD) | Q2 2024 (IDR) | YoY |
|---|---|---|---|---|
| Net Interest and Sharia Income, net ("Net Revenue" equivalent) | Rp36,357,169M | ~$2,240M | Rp34,872,896M | ✅ +4.26% |
| Operating Income (Profit from Operations) | Rp17,383,127M | ~$1,071M | Rp18,511,426M | ⚠️ -6.10% |
| Net Income (attributable to owners) | Rp12,603,456M | ~$776M | Rp13,816,337M | ⚠️ -8.78% |
| Net Income (total consolidated, incl. non-controlling interests) | Rp12,729,118M | ~$784M | Rp13,913,523M | ⚠️ -8.51% |
| EPS (basic, attributable to owners, quarterly) | Rp83 | ~$0.0051 | Rp92 | ⚠️ -9.78% |
| Impairment for financial assets | Rp10,860,570M | ~$669M | Rp9,339,288M | ⚠️ +16.29% (higher is worse) |
| Total Operating Expense | Rp21,556,336M | ~$1,328M | Rp21,439,846M | ⚠️ +0.54% (higher is worse, but a sharp deceleration from Q1's +11.66%) |
Balance sheet: June 2025 vs. March 2025 (QoQ) and June 2024 (YoY), consolidated, as filed, total equity on an attributable-to-owners basis throughout
| Balance sheet metric | Jun 2025 (IDR) | Jun 2025 (USD) | Mar 2025 (IDR) | QoQ | Jun 2024 (IDR) | YoY |
|---|---|---|---|---|---|---|
| Total Assets | Rp2,106,371B | ~$129,748M | Rp2,098,229B | ✅ +0.39% | Rp1,977,371B | ✅ +6.52% |
| Total Loan & Financing (gross, incl. subsidiaries) | Rp1,416,619B | ~$87,267M | Rp1,373,700B | ✅ +3.12% | Rp1,336,780B | ✅ +5.97% |
| Total Deposits (Third Party Funds) | Rp1,482,120B | ~$91,309M | Rp1,421,600B | ✅ +4.26% | Rp1,389,662B | ✅ +6.65% |
| Total Equity (attributable to owners) | Rp315,501B | ~$19,437M | Rp299,611B | ✅ +5.30% | Rp305,897B | ✅ +3.14% |
| Total Cash and Cash Equivalents (per cash flow statement, period-end) | Rp230,713B | ~$14,213M | Rp265,314B | ⚠️ -13.04% | Rp152,594B | ✅ +51.20% |
Equity's QoQ rebuild follows Q1's dividend-driven drop (see Q1 2025's post). Cash fell QoQ as loan growth (+3.12%) outpaced deposit growth (+4.26% but off a smaller base of net new liquidity), still up sharply YoY against Q1 2024's deliberately frontloaded pre-Ramadan liquidity build.
Key Operational Metrics
Consolidated unless stated; per BRI's own filed financial-ratio notes and investor presentation
- CASA»: 65.5% (Jun 2025) vs Mar 2025's 65.8% ⚠️ but 63.2% (Jun 2024) ✅ - modestly down QoQ, still up YoY.
- Net Interest Margin (NIM), consolidated, quarter-alone: 7.8% (2Q25), up 16bps QoQ from 1Q25's 7.7%, but down from 2Q24's 7.9% (management notes the January 2025 NIM-calculation methodology change makes pre-2025 figures not strictly comparable).
- NPL ratio - gross, consolidated: 3.0% (2Q25/1H25) vs Mar 2025's 3.0% - essentially flat QoQ, and flat YoY (3.1% at 1H24) - the consolidated headline reads calm, but see the Business Lines section below for what it's masking.
- Total CAR (bank-only): 22.7% (Jun 2025), up from Mar 2025's 21.5% ✅ - a partial rebuild of the capital ratio that fell nearly 3 points last quarter on the FY2024 dividend payout, though still below Jun 2024's 23.2%.
- Cost to Income Ratio (CIR), consolidated, cumulative guidance basis: 41.9% (1H25), up from 1Q25's 40.7% ⚠️ and up from 1H24's 41.1% - CIR worsened even as absolute standalone opex growth cooled sharply YoY, since income growth slowed by more this quarter.
- Credit Cost, consolidated, cumulative guidance basis: 3.4% (1H25), still above the FY2025 3.0%-3.2% guidance band BRI has now missed on the high side every quarter since the band was set, though down slightly from 1Q25's 3.5%.
- Net Credit Cost (after recoveries), consolidated, cumulative: 1.9% (1H25), improved from 1Q25's 2.1% ✅.
- ROA After Tax, consolidated: 2.5% (2Q25), down from 1Q25's 2.7% and 2Q24's 3.0%.
- ROE (balance-sheet basis), consolidated: 16.1% (2Q25), down from 1Q25's 17.2% and 2Q24's 19.2% - a steady multi-quarter decline.
Business Lines: Loan Growth and Credit Quality
Consolidated, 1H 2025 vs. 1H 2024, per BRI's own investor presentation's segment-NPL table
Micro NPL worsened sharply to 3.86% from 2.95% a year earlier - a 91-basis-point deterioration, the largest of any segment tracked here, continuing the multi-quarter pattern this series has followed since Q1 2025 flagged Micro as the segment showing no sign of turning.
Consumer NPL edged up modestly to 2.25% from 2.13% - still one of BRI's better-behaved retail categories, but no longer improving.
SME NPL improved slightly to 4.96% from 5.05% - a small repair, though SME remains BRI's second-worst-performing category by NPL level.
Commercial NPL worsened to 2.54% from 1.75% - a 79-basis-point deterioration, the second-largest move of any segment this quarter.
Corporate NPL improved sharply, to 1.61% from 3.07% a year earlier - the single largest credit-quality improvement of any segment by a wide margin, and the main reason the consolidated NPL ratio (3.04%, essentially flat YoY) doesn't reflect the deterioration visible everywhere else.
Segment Comparison
The consolidated NPL ratio holding roughly flat YoY (3.05%→3.04%) reads as a quiet quarter on credit - it isn't. Corporate's 146-basis-point improvement is doing almost all the work of masking genuine deterioration in Micro (+91bps) and Commercial (+79bps), with Consumer also drifting slightly worse (+12bps) and only SME showing a small independent improvement (-9bps). This is the same bifurcation pattern Q1 2025 flagged between BRI's largest-ticket and smallest-ticket lending, and it has now persisted for two consecutive quarters rather than resolving either way.
The financial-statement segment note (a different five-way split - Micro, Retail, Corporate, Others, Subsidiaries - than the deck's product-line breakdown above) shows the profitability consequence of this directly: Retail segment income before tax swung from a Rp3,537,418 million profit in H1 2024 to a Rp1,151,017 million loss in H1 2025, even as Micro segment income before tax fell a comparatively modest 12.34% YoY (Rp15,521,567 million to Rp13,607,512 million) and Corporate segment income before tax more than doubled, up 104.71% YoY (Rp2,926,697 million to Rp5,990,841 million) - see Beyond the Usual for what's actually driving the Retail swing.
Beyond the Usual
This quarter's source documents are BRI's unaudited interim consolidated financial statements for the six months ended June 30, 2025 and its Q2 2025 investor presentation.
The Retail Segment's Swing to a Loss Is a Cost Story, Not a Credit Story
BRI's own operating-segment note shows Retail's total income actually fell 1.79% YoY (Rp24,760,293 million to Rp24,315,972 million) while the segment's allocated "other operating expense" line jumped 34.6% YoY (Rp11,556,175 million to Rp15,554,030 million) - a far larger move than the segment's own provision for impairment losses, which grew just 1.6% YoY (Rp9,629,484 million to Rp9,784,981 million) over the same period. Combined, a shrinking top line and a sharply higher allocated cost base are what turned a Rp3,537,418 million profit into a Rp1,151,017 million loss, not a deterioration in Retail credit quality. BRI's segment note doesn't explain what specifically moved inside that expense line or why the allocation to Retail grew so much faster than the segment's own income.
The Cost Problem And The Credit Problem Are Now Moving in Opposite Directions
Standalone Q2 2025 operating expense growth cooled to 0.54% YoY from Q1 2025's 11.66% - a genuine and sharp deceleration - but standalone impairment for financial assets growth accelerated the other way, from Q1's 5.26% YoY to 16.29% YoY this quarter. The two problems this series has now tracked in successive quarters (cost discipline, then credit provisioning) haven't resolved together; one eased just as the other worsened, leaving operating income down for a second straight quarter regardless of which line is actually responsible.
Related-party guarantees issued (foreign-currency, US Dollar-denominated) fell 36.4% YoY (notional USD 1,293,052,041 to USD 815,427,647, a Rp20,811,673 million to Rp13,238,468 million equivalent), a larger decline than the roughly 9.8% drop in total related-party guarantee-and-L/C exposure (Rp12,416,340 million to Rp11,204,597 million) - a shift toward smaller-denomination related-party facilities rather than an overall change in scale, since third-party guarantee-and-L/C exposure (Rupiah and foreign-currency combined) actually grew 2.26% over the same period (Rp37,438,602 million to Rp38,284,170 million).
Bank-only Total CAR rebuilt to 22.7% from Q1's 21.5% low, but the two components moved unevenly: Cost of Deposit held flat at 3.2% while Cost of Fund also held flat at 3.4% - unlike Q1, when both the dividend-driven capital hit and elevated NIM pressure moved together, this quarter's capital partial-recovery happened without a corresponding funding-cost tailwind.
Stock Price: A Continuing Slide, Not a New One
BRI's shares closed Q2 2025 at Rp3,740, down 7.65% QoQ from Q1 2025's Rp4,050 close and down 18.70% YoY from Q2 2024's Rp4,600. Measured over the trailing two years (July 2023 through June 2025), the stock swung from a February 2024 peak of Rp6,125 to a February 2025 trough of Rp3,360 - a 45.1% peak-to-trough decline, the same swing Q1 2025's post already measured from the same peak and trough, both of which remain the extremes of this rolling two-year window. Rather than continuing April-May's partial recovery toward Rp4,450 (per the underlying monthly price series), the stock gave that back and closed the quarter lower than where Q1 ended - a genuine continuation of the broader multi-quarter de-rating in Indonesian bank valuations, not a reversal of it, and not something this quarter's own operating results (a decelerating cost problem, an accelerating credit-cost problem) obviously explain on their own.
Target Valuation Range
~9.95x P/E, ~1.80x P/B. Bottom line: BRI's discount to BCA widened again this quarter on both P/E and P/B - not because BRI's own fundamentals got meaningfully worse, but because its share price fell faster than BCA's while trailing earnings for both banks moved in roughly the same direction. The discount continues to read as the market pricing real execution risk (the Retail segment swing, the accelerating credit-cost line) rather than a clean value opportunity.
Trailing-twelve-month EPS of approximately Rp376 (Q3 2024's Rp102, Q4 2024's Rp100, Q1 2025's Rp91, and Q2 2025's Rp83) against the Rp3,740 close gives a P/E» of approximately 9.95x - down from Q1 2025's ~10.57x, as the share price fell faster (-7.65% QoQ) than trailing EPS (-1.83% QoQ).
Book value per share is approximately Rp2,082 (Rp315,501,335 million total equity attributable to owners ÷ 151,559,001,604 shares outstanding, unchanged since Q3 2021).
| Market cap → book value | Q2 2025 |
|---|---|
| Share price (period-end) | Rp3,740.00 |
| Shares outstanding | 151,559,001,604 |
| Market capitalization | ~Rp566,831B (~$34.92B, using ~Rp16,235/USD) |
| Total equity attributable to owners (book value) | Rp315,501B |
| P/B» | ~1.80x |
| Peer-multiple sanity check | Q1 2025 | Q2 2025 | Change |
|---|---|---|---|
| P/E» | ~10.57x | ~9.95x | ✅ down - share price fell faster (-7.65% QoQ) than trailing EPS (-1.83% QoQ) |
| P/B» | ~2.05x | ~1.80x | ✅ down - share price fell faster than book value per share grew |
BBCA's own Q2 2025 post reported a trailing P/E of ~18.8x and a P/B of ~4.09x - a gap to BRI's ~9.95x and ~1.80x of roughly 1.9x on P/E and 2.3x on P/B, both modestly wider than Q1 2025's ~1.8x and ~2.1x as BRI's own share price fell further than BCA's this quarter even though the two banks' earnings trends were directionally similar.
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 interim consolidated financial statements as of June 30, 2025 and for the six-month period then ended, and its Q2 2025 investor presentation.