BMRI - Net profit grew 5.23% yoy in 1H24

BMRI - Net profit grew 5.23% yoy in 1H24 Bank Mandiri (BMRI) interest income grew 12.5% yoy, net interest income 3.75% yoy. PPOP grew 3.47% yoy, while PATMI 5.23% yoy. Total loans increased 20.5% yoy. TPF +15.4% yoy while CASA +17.9% yoy. NIM at 5.09%, CoC and gross NPL 0.98% and 1.16%, respectively. (Source : Company) Comment : BMRI 1H24 net profit grew 5.2% yoy to IDR26.5tn on the back of solid top line growth and boosted by improving credit cost. On quarterly basis, it recorded at a much higher growth (9.0% qoq and 9.3% yoy) supported by softer cost of fund coupled with mild provision growth. In all, 1H24 arrives in-line within ours and consensus expectation at a run rate of 45.6%/45.4%. Mounting total loan growth at 20.5% yoy was backed by robust corporate and commercial loan demand of 29.7% yoy and 21.7% yoy, respectively. Total customer deposit grew at a healthy level of 15.4% yoy, led by strong CA growth of 23.0% yoy and bringing CASA grew 17.9% yoy. NIM slightly improve to 5.09% and to 4.94% from 4.83% in 1Q24 on bank only level. Key risk metrics recorded significant improvement with NPL drops to 1.16% and CoC (-21 bps yoy) surpassing BMRI ‘24F range guidance at 1.0%-1.2%. Maintain BUY BMRI GGRM based-TP of IDR8,100 (‘24F P/B of 2.6x) while currently it is trading at 2.1x’24F P/B, or slightly above +1SD historical mean of 2.0x.