BBRI - Credit recovery increases 36.25% in Nov23

BBRI - Credit recovery increases 36.25% in Nov23 Bank Rakyat Indonesia (BBRI) is aggressively mitigating the risk of accumulating bad credit from non-performing assets through the sale of collateral. Selling collateral is one part of credit recovery originating from auctions and the impact of auctions. As of Nov’23, BRI credit recovery has increased by 36.25% compared to last year. BBRI NPL had increased to 3.07%, higher than the first half of this year which was 2.95%. The ratio is still slightly smaller than the same period last year which was at the level of 3.09%. BRI managed to record recovery income reaching IDR10.6 tn, or an increase from the same period in the previous year which amounted to IDR8.3 tn, with a recovery rate reaching 43.3% of write-off credit of IDR24. 5 tn. (Source: Kontan) Comment: Credit recovery process it is a common business process that should be done, especially following negative key event such as Pandemic covid. We believe the recovery momentum and better asset quality improvement will continue and thus will overall help the bank to maintain its credit lower getting lower and normalized to the level on pre-pandemic. That said, we maintain BUY stance on BBRI DDM TP of IDR6,390 (2.9x ’24F P/B).