BBTN - 1Q24 PATMI grew by 7.4% yoy

BBTN - 1Q24 PATMI grew by 7.4% yoy Bank Tabungan Negara (BBTN) first quarter earnings growth of 7.4% yoy were supported by solid interest income which came in 14.9% yoy higher and a well-managed cost of credit. Total loan robust growth (14.8% yoy) was back by continuing solid subsidized mortgage demand (12.3% yoy). On liabilities side, total TPF grew by 11.9% yoy, driven by strong TD growth of 17.2% yoy. On risk metrics, NPL arrives at a better number (1Q24: 3.0%) and within guidance, while CoC of 0.8% (1Q23: 1.1%) is beating BBTN’s management ‘24F expectation. (Source : Company) Comment : In all, 1Q24 PATMI arrives inline with ours and market forecast at a run-rate of 22.4%/22.3% vs 5yr hist avg of 24.3%. Total loan robust growth (14.8% yoy) was back by continuing solid subsidized mortgage demand (12.3% yoy). Worth noting that non subsidized also noted a healthy growth of 11.2% yoy. We also like non-housing sturdy loan growth of 46.4% yoy and made the overall portion 330bps higher yoy. We like management strategy on TPF. UUS spin off is remained on the process, while on bulk sales pipeline, we believe the bank could achieved its ‘24F expectation. More details on BBTN 1Q24 earnings, will be delivered on BBTN 1Q24 company updated report. Maintain BUY, GGM TP of IDR1,770, pegged at 0.6x ‘24F P/B, currently traded at 0.4x’24F P/B, or slightly above its -2SD of 0.3x.