BBCA - Increases deposit interest as of June 2024

BBCA - Increases deposit interest as of June 2024 Bank Central Asia (BBCA) recently raised deposit interest rates in June 2024 for tenors of 1 month and 3 months. BCA President and Director Jahja Setiaatmadja also explained that the increase in BCA deposit interest rates was a step in following the increase in the BI benchmark interest rate by 25 basis points to 6.25%. However the increase in BCA deposit interest was not directly accompanied by an increase in credit interest. The interest on BCA rupiah deposits for a 1-month tenor with a nominal value of under IDR2 bn which was originally set at 2.5%, has become 3%, or an increase of 50 bps. Meanwhile, for 3-month term deposit interest, which was originally set at 2.85%, is now 3.25%, or an increase of 40 bps. Then, the interest on deposits with a tenor of 1 month and nominal deposits above IDR2 bn will be 3.25%, an increase of 35 bps and deposit interest for a 3-month term rose 10 basis points to 3.25% from the previous 3.15%. (Source: Kontan) Comment : Amid the high interest rate environment and the latest benchmark rate increased (25bps), we believe BBCA will continue to record lower cost of deposit compared to its peers. We like its massive mass market deposit based which will become as BBCA’s net interest income growth catalyst. Maintain BUY with GGM-based TP of IDR11,070 (4.9x ’24F P/B)