EQUITY RESEARCH

BNGA - Results Update - 31 October 2024

CIPTADANA SEKURITAS ASIA

BUY Bank CIMB Niaga

Solid 3Q24 results with admirable CoC
TP: 2,400 (+29.4%)

Sector Banking 3Q24: solid CoC performance, NIM declined due to lower LDR
Bank CIMB Niaga (BNGA) delivered solid results, with earnings growing by 3.4% YoY (0.0%
Bloomberg Ticker BNGA IJ
QoQ) to Rp1.7 tn in 3Q24. Cost of credit remained admirable at 0.6% in 3Q24 (vs. 0.7% in
Share Price Performance
2Q24), outperforming both our estimates and management guidance. NIM declined by -
15bps to 4.3% in 3Q24, impacted by a slightly higher CoF (+3bps QoQ) and, more notably, a
Last Price(Rp) 1,870 suboptimal LDR. LDR stood at 85% as of 3Q24 (vs. 87% a year ago). Loan-to-total earnings
Avg. Daily T/O(Rpbn/USDmn) 12.9/0.8 assets ratio also stood lower at 66% as of 3Q24 (vs. 70% a year ago) amid slow loan
growth, resulting in reduced overall earnings asset yield. Opex increased by 8% QoQ,
3m 6m 12m
restraining PPoP growth to -6% QoQ, which came slightly below expectations. Overall,
Absolute (%) 1.1 2.2 8.4 cumulative earnings grew by 5% YoY to Rp5.1 tn in 9M24, in-line with both ours and
Relative to JCI (%) -2.5 -3.9 -2.2 consensus at 76% of 2024F (vs. historical of 75%). Cumulative CoC improved to 0.65% in
9M24 (vs. 0.85% in 9M23), largely offsetting the weakness in NIM (-50bps YoY) at 4.4% in
52w High/Low price(Rp) 2,220/1,625
9M24. Given the weakening 9M24 NIM, management revised down its NIM guidance by
10bps lower to 4.1-4.2% (vs. 9M24 reported NIM of 4.16%).
2,500 25%
Stronger loan growth on auto and SME, but slowing mortgage and corporate
20%
2,000 On the balance sheet, loan growth remained moderate at 6% YoY (1% QoQ) as of 3Q24.
15% Accelerated loan growth was seen in auto loan (18% YoY and 7% QoQ) followed by SME
1,500 10% loan segment (10% YoY and 3% QoQ). While deceleration in loan growth primarily driven
1,000 5% by mortgage (-1% YoY and -1% QoQ), reflecting intense competition with large mortgage
0%
players. To tackle this, management plans to shift focus to second-tier cities, where
500 competition is less intense than in first-tier cities. Corporate and commercial loan growth
-5%
also slightly slowed to 7% and 4% YoY (0% QoQ for both), respectively, due to tighter
0 -10% composition within the wholesale lending space.
Oct-23
Nov-23
Dec-23

Apr -24

Aug -24
Sep -24
Oct-24
May-24

Jul-24
Jan-24
Feb-24
Mar-24

Jun-24

Upgrading the CoC guidance on solid asset quality achievement

BNGA’s CoC improvement was driven by solid asset quality, with NPL decreasing to 2.0%
BNGA 1yr Rel . to JCI (RHS )
(vs. 2.2% in 2Q24 and 2.5% in 3Q23). LAR also improved to 9.9% (vs. 10.4% in 2Q24), while
Outstanding Shrs (mn) 24,932 LAR coverage rose significantly to 55% (vs. 53% in 2Q24). That said, management is
upgrading its CoC guidance to <1.0% (vs. previously 1.0-1.1% and 9M24 reported at
Mkt. Cap (Rpbn/USDmn) 46,623/2,969
0.88%).
Estimated Free Float (%) n/a
Demand deposit remained the main CASA growth driver
Major Shareholders
CASA continued its admirable performance (+9% YoY, +5% QoQ), led by institutional CASA
CIMB Group Sdn Bhd 92.5% growth i.e. demand deposit (+15% YoY and +5% QoQ). The bank also reduced the Time
Deposit (+9% YoY, -2% QoQ), hence CASA ratio saw a robust increase to 67% (vs. 65% as of
2Q24).
Maintain Buy with target price of Rp2,400/share
EPS Consensus Overall, this is a solid result from BNGA given its solid asset quality improvement. We also
believe the bank is well-positioned to benefit from lower benchmark rates, offering
Ciptadana Cons. % Diff
potential NIM upside in 4Q24 and 2025F. Dividend yield potential also remains attractive at
2024F 271.0 269.8 0.4 ~7.1% in 2025F, assuming a 50% payout ratio. We maintain our Buy rating on BNGA with a
2025F 296.9 298.4 -0.5
target price of Rp2,400/share, implying a 2025F PV of 1.04x.

2026F 334.1 340.9 -2.0

Exhibit 1 : Financial Highlights
Year to 31 Dec 2022A 2023A 2024F 2025F 2026F
Net Interest Income (Rpbn) 13,476 13,352 14,041 15,334 16,582
Net Profit (Rpbn) 5,042 6,474 6,763 7,410 8,336
EPS (Rp) 202.2 259.5 271.0 296.9 334.1
EPS growth (%) 22.9 28.3 4.5 9.6 12.5
BVPS (Rp) 1,812.6 1,971.4 2,134.3 2,307.4 2,505.6
Erni Marsella Siahaan, CFA PER (x) 9.4 7.4 7.0 6.4 5.7
+62 21 2557 4800 ext. 919 PBV (x) 1.1 1.0 0.9 0.8 0.8
[email protected] ROA (%) 1.6 2.0 2.0 2.0 2.1
ROE (%) 11.4 13.7 13.2 13.4 13.9
http://www.ciptadana.com Dividend Yield (%) 4.9 6.0 6.5 7.1 7.8
Source : BNGA, Ciptadana Estimates

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 EQUITY RESEARCH
BNGA - Results Update - 31 October 2024
CIPTADANA SEKURITAS ASIA

Exhibit 2: BNGA 9M24 results

(in Rp bn) 3Q24 2Q24 3Q23 QoQ YoY 9M24 9M23 YoY 2024F 9M/24F

Interest income 6,173 6,006 5,710 2.8% 8.1% 18,023 16,714 7.8%
Interest expense (2,820) (2,635) (2,357) 7.0% 19.6% (8,015) (6,527) 22.8%
Net interest income 3,352 3,371 3,353 -0.5% 0.0% 10,008 10,187 -1.8% 14,041 71%

Non-interest operating income 1,448 1,414 1,136 2.4% 27.5% 4,376 4,319 1.3% 5,805 75%

Non-interest operating expense (2,258) (2,084) (2,089) 8.3% 8.1% (6,499) (6,530) -0.5% (8,854) 73%

PPOP 2,542 2,700 2,399 -5.9% 6.0% 7,885 7,977 -1.2% 10,992 72%

-
Provision expense (492) (492) (249) 0.0% 97.6% (1,475) (1,779) 17.1% (2,365) 62%

Operating profit 2,050 2,208 2,150 -7.2% -4.7% 6,410 6,198 3.4% 8,627 74%

Net income 1,726 1,726 1,669 0.0% 3.4% 5,133 4,902 4.7% 6,763 76%

Ratios (%)
Asset yield 7.9 8.0 8.0 0.0 -0.1 7.9 8.1 -0.2
Cost of fund 4.0 3.9 3.6 0.1 0.4 3.9 3.4 0.4
NIM 4.3 4.5 4.7 -0.2 -0.4 4.4 4.9 -0.5
CASA 66.7 65.2 66.7 1.5 0.0 66.7 66.7 0.0
LDR 85.3 86.8 87.3 -1.5 -2.0 85.3 87.3 -2.0
Cost to income 47.0 43.6 46.6 3.5 0.5 45.2 45.0 0.2
Tax rate 22.5 21.1 22.1 1.5 0.5 21.9 21.5 0.4
NPL gross 2.0 2.2 2.5 -0.1 -0.4 2.0 2.5 -0.4
Credit cost 0.6 0.7 0.4 0.0 0.3 0.6 0.9 -0.2
Loan loss coverage 264.3 253.0 267.9 11.3 -3.6 264.3 267.9 -3.6
CAR 23.2 22.3 23.4 0.8 -0.2 23.2 23.4 -0.2
ROA 2.0 2.0 2.0 -0.1 -0.1 2.0 2.1 -0.1
ROE 13.6 13.7 14.3 -0.1 -0.7 13.5 14.1 -0.6

Deposit 255,971 249,844 235,260 2.5% 8.8% 255,971 235,260 8.8%

Demand 88,700 83,011 77,237 6.9% 14.8% 88,700 77,237 14.8%
Savings 82,032 79,874 79,725 2.7% 2.9% 82,032 79,725 2.9%
Time 85,239 86,959 78,299 -2.0% 8.9% 85,239 78,299 8.9%
Loan 218,373 216,882 205,358 0.7% 6.3% 218,373 205,358 6.3%
- -
NPL 4,234 4,520 4,876 -6.3% 13.2% 4,234 4,876 13.2%
- -
Loan loss reserves -11,192 -11,435 -13,063 -2.1% 14.3% -11,192 -13,063 14.3%
Total assets 354,296 346,694 329,130 2.2% 7.6% 354,296 329,130 7.6%
Shareholders equity 52,038 49,568 47,272 5.0% 10.1% 52,038 47,272 10.1%

Source : Company and Ciptadana Sekuritas Asia

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 EQUITY RESEARCH
BNGA - Results Update - 31 October 2024
CIPTADANA SEKURITAS ASIA

Exhibit 3: BNGA Forward PBV Exhibit 4: BNGA Forward PE

x x
1.1 14.0
1.0
12.0
0.9
0.8 10.0
0.7
8.0
0.6
0.5 6.0
0.4
4.0
0.3
0.2 2.0

May-17

May-18

May-19

May-20

May-21

May-22

May-23

May-24
Sep-17

Sep-18

Sep-19

Sep-20

Sep-21

Sep-22

Sep-23

Sep-24
Jan-17

Jan-18

Jan-19

Jan-20

Jan-21

Jan-22

Jan-23

Jan-24
Sep-17

Sep-18

Sep-19

Sep-20

Sep-21

Sep-22

Sep-23

Sep-24
Jan-17

Jan-18

Jan-19

Jan-20

Jan-21

Jan-22

Jan-23

Jan-24
May-17

May-18

May-19

May-20

May-21

May-22

May-23

May-24

Source : Bloomberg and Ciptadana Sekuritas Asia Source : Bloomberg and Ciptadana Sekuritas Asia

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 EQUITY RESEARCH
BNGA - Results Update - 31 October 2024
CIPTADANA SEKURITAS ASIA

Exhibit 5: ESG review

Company description Banking & Financials

Environmental
1. BNGA committed to the POJK 51/POJK.03/ 2017
concerning the Implementation of Sustainable
Finance. Beyond the regulation, BNGA is issuing
a sector-specific policy (such as on land-based
sector) in 2020 that is using credible and
science-based standards.
2. BNGA has established a Sustainable Finance
Action Plan (RAKB) for 2019-2023 in 2018. BNGA
has identified and conducted monitoring of
debtors who have received the environmental
assessment of PROPER, Indonesia Sustainable
Palm Oil (ISPO) certificate and Roundtable on
Sustainable Palm Oil (RSPO) certificate. The
bank also has a Sustainability and Sustainable
Finance Policy, which among others regulates
the provisions regarding Exclusion List and
Sustainability Due Diligence for potential
business relations.
3. More than 95% of banking transactions has been
facilitated by digital transactions. By using the
CO2 reduction calculation, these digital services
have resulted in carbon (Greenhouse Gas)
emissions reductions.

Social
1. BNGA focuses on lending to micro, small and
medium business (MSME) segment besides the
corporates and consumers.
2. BNGA organized several financial inclusion and
ESG-related literacy programs, namely the Ayo Menabung
opportunity or risk dan Berbagi (AMDB), Tour De Bank (TDB), and
assessment #KejarMimpi Goes to School, along with a
Student Savings product (SimPel) as a support
for financial inclusion program.

Governance
1. The Board of Commissioners has 6 members
and three of which are Independent
Commissioner. Two of the members is female.
Board of Director has three female directors out
of nine directors.
2. BNGA implements the Anti-Money Laundering &
Terrorism Financing Prevention Program (APU
and PPT) that is actively monitored by the BoD
and BoC. BNGA also has a whistle blowing
system (WBS) and has appointed independent
third parties to manage the complaints.

Source : Company and Ciptadana Sekuritas

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 EQUITY RESEARCH
CIPTADANA SEKURITAS ASIA
BNGA - Results Update - 30 October 2024

Exhibit 6 - Income Statement

Year to 31 Dec (Rpbn) 2022A 2023A 2024F 2025F 2026F
Interest income 19,114 22,306 24,216 25,991 28,029
Interest expenses -5,638 -8,954 -10,175 -10,657 -11,448
Net interest income 13,476 13,352 14,041 15,334 16,582
Other non-interest income 5,390 5,433 5,805 6,086 6,632
Total operating income 18,866 18,785 19,846 21,420 23,213
Operating expenses -8,484 -8,584 -8,854 -9,310 -9,791
PPoP 10,382 10,202 10,992 12,110 13,423
Prov. expenses and others -3,814 -2,007 -2,365 -2,630 -2,726
Operating profit 6,568 8,195 8,627 9,480 10,697
Non-operating income (exp.) 11 162 162 162 162
Pre-tax profit 6,579 8,357 8,789 9,642 10,859
Income tax -1,483 -1,806 -1,934 -2,121 -2,389
Minority interest -55 -77 -93 -111 -133
Net profit 5,042 6,474 6,763 7,410 8,336

Exhibit 7 - Balance Sheet

Year to 31 Dec (Rpbn) 2022A 2023A 2024F 2025F 2026F
Cash 5,439 3,928 3,928 3,928 3,928
Current acct, with BI 8,985 13,180 17,849 19,212 20,681
Interbank placement 17,618 7,525 7,525 7,525 7,525
Mkt, securities 6,320 14,523 15,460 16,490 17,623
Govt. Bonds 59,199 70,597 72,008 79,209 80,001
Loans 177,605 194,011 209,447 228,128 248,738
Fixed assets 9,125 8,849 9,115 9,388 9,670
Other assets 16,654 14,444 14,444 14,444 14,444
Total Asset 306,754 334,370 357,454 386,386 411,074

Deposits from customer 227,189 235,862 253,224 272,699 293,677

Borrowings 11,421 29,169 30,824 35,964 34,729
Other liabilities 20,362 18,241 18,241 18,241 18,241
Total liabilities 261,478 285,032 304,050 328,664 348,407
Shareholder equity 45,192 49,193 53,259 57,578 62,523
Minority interest 84 145 145 145 145
Total liab + SHE 306,754 334,370 357,454 386,386 411,074

Exhibit 8 - Per Share Data

(Rp) 2022A 2023A 2024F 2025F 2026F

EPS 202.2 259.5 271.0 296.9 334.1
BVPS 1,812.6 1,971.4 2,134.3 2,307.4 2,505.6
DPS 94.1 115.1 123.6 135.5 148.5

Source : BNGA, Ciptadana Estimates

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 EQUITY RESEARCH
BNGA - Results Update - 31 October 2024
CIPTADANA SEKURITAS ASIA

Exhibit 9 - Key Ratios

Year to 31 Dec 2022A 2023A 2024F 2025F 2026F
Ratios
ROA (%) 1.6 2.0 2.0 2.0 2.1
ROE (%) 11.4 13.7 13.2 13.4 13.9
Net interest margin (%) 5.0 4.8 4.6 4.7 4.7
Yield on earnings asset (%) 7.1 8.0 8.0 8.0 8.0
Average cost of fund (%) 2.3 3.5 3.7 3.6 3.6
Cost to income ratio (%) 45.0 45.7 44.6 43.5 42.2
Cost of credit (%) 1.4 0.7 0.8 0.8 0.8
Non-performing loan (%) 2.8 2.0 1.9 1.8 1.8
Coverage ratio (%) 243.0 292.0 308.2 321.2 327.1
Loan to deposit ratio (%) 83.9 87.3 87.8 88.8 89.9
CASA ratio (%) 63.6 63.9 63.6 63.5 63.4
Equity to Asset (%) 14.7 14.7 14.9 14.9 15.2
Capital adequacy ratio (%) 23.2 23.6 24.7 24.5 24.3
Tier-1 CAR 20.8 22.4 20.7 20.5 20.3
PER (x) 9.4 7.4 7.0 6.4 5.7
PBV (x) 1.1 1.0 0.9 0.8 0.8
Dividend yield (%) 4.9 6.0 6.5 7.1 7.8
Growth (%)
Total assets growth -1.3 9.0 6.9 8.1 6.4
Loan growth 7.6 8.0 8.0 8.9 9.0
Deposit growth -5.9 3.8 7.4 7.7 7.7
NPL growth -12.7 -24.3 3.2 4.8 6.2
SHE growth 4.2 8.9 8.3 8.1 8.6
Net interest income growth 3.0 -0.9 5.2 9.2 8.1
Non-interest income growth 20.3 0.8 6.8 4.8 9.0
Provision expense growth -8.5 -47.4 17.9 11.2 3.7
Net profit growth 23.0 28.4 4.5 9.6 12.5

Source : BNGA, Ciptadana Estimates

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 EQUITY RESEARCH
BNGA - Results Update - 31 October 2024
CIPTADANA SEKURITAS ASIA

EQUITY RESEARCH

HEAD OF RESEARCH ECONOMIST ANALYST

Arief Budiman Renno Prawira Erni Marsella Siahaan, CFA
Strategy, Automotive, Heavy Equipment, Economist Banking, Hospital
Construction, Oil & Gas and Shipping T +62 21 2557 4800 ext 735 T +62 21 2557 4800 ext 919
T +62 21 2557 4800 ext 819 E [email protected] E [email protected]
E [email protected]

ANALYST ANALYST ANALYST

Yasmin Soulisa Gani Thomas Radityo
Property, Plantations Telco, Tower, Media, Technology Coal, Metal Mining
T +62 21 2557 4800 ext 799 T +62 21 2557 4800 ext 734 T +62 21 2557 4800 ext 795
E [email protected] E [email protected] E [email protected]

ANALYST ANALYST ANALYST

Putu Chantika Putri Muhammad Gibran Alif Ihsanario
Consumer, Cigarette Cement, Poultry, Toll road Retail, Pharmaceutical
T +62 21 2557 4800 ext 740 T +62 21 2557 4800 ext 798 T +62 21 2557 4800 ext 760
E [email protected] E [email protected] E [email protected]

TECHNICAL ANALYST RESEARCH ASSISTANT

Asrul Husni Sumarni
T +62 21 2557 4800 ext 780 T +62 21 2557 4800 ext 920
E [email protected] E [email protected]

EQUITY SALES

HEAD OF INSTITUTIONAL EQUITY SALES HEAD OF EQUITY SALES

Dadang Mulyana Maureen Natalia
Plaza ASIA Office Park unit 2 Plaza ASIA Office Park unit 2
Jl. Jend. Sudirman Kav. 59 Jl. Jend. Sudirman Kav. 59
Jakarta - 12190 Jakarta - 12190
T +62 21 2557 4800 ext 838 T +62 21 2557 4800 ext 997
F +62 21 2557 4900 F +62 21 2557 4900
E [email protected] E [email protected]

BRANCH OFFICES

JAKARTA - MANGGA DUA SURABAYA

Komplek Harco Mangga Dua Intiland Tower Surabaya
Rukan Blok C No.10 Ground Floor Suite 5 & 6
Jl. Mangga Dua Raya Jl. Panglima Sudirman 101-103
Jakarta - 10730 Surabaya - 60271
T +62 21 600 2850 T +62 31 534 3938
F +62 21 612 1049 F +62 31 534 3886

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 EQUITY RESEARCH
BNGA - Results Update - 31 October 2024
CIPTADANA SEKURITAS ASIA

Analyst Certification

Each contributor to this report hereby certifies that all the views expressed accurately reflect his or her personal views about the
companies, securities and all pertinent variables. It is also certified that the views and recommendations contained in this report are not
and will not be influenced by any part or all of his or her compensation.

Disclaimer

This report does not constitute an offer to buy or sell any security/instrument, invitation to offer or recommendation to enter into any
transaction. Nor are we acting in any other capacity as a fiduciary to you. When making and investment decision, you should determine,
without reliance upon us or our affiliates, the economic risks and merits (and independently determine that you are able to assume these
risks) as well as the legal, tax and accounting characterizations and consequences of any such transaction. In this regard, by accepting this
report, you acknowledge that (a) we are not in the business of providing (and you are not relying on us for) legal, tax or accounting advice,
(b) there may be legal, tax or accounting risks associated with any transaction, (c) you should receive (and rely on) separate and qualified
legal, tax and accounting advice and (d) you should apprise senior management in your organization as to such legal, tax and accounting
advice (and any risks associated with any transaction and our disclaimer as to these matters.

The information contained in this report is based on material we believe to be reliable; however, we do not represent that it is accurate,
current, complete, or error free. Assumptions, estimates and opinions contained in this report constitute our judgment as of the date of the
document and are subject to change without notice. Any projections are based on a number of assumptions as to market conditions and
there can be no guarantee that any projected results will be achieved. Past performance is not a guarantee of future results. PT
CIPTADANA SEKURITAS ASIA AND ITS AFFILIATES SPECIFICALLY DISCLAIMS ALL LIABILITY FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL
OR OTHER LOSSES OR DAMAGES INCLUDING LOSS OF PROFITS INCURRED BY YOU OR ANY THIRD PARTY THAT MAY ARISE FROM ANY
RELIANCE ON THIS REPORT OR FOR THE RELIABILITY, ACCURACY, COMPLETENESS OR TIMELINESS THEREOF.

Disclaimer: This document is not intended to be an offer, or a solicitation of an offer, to buy or sell relevant securities (i.e. securities
mentioned herein or of the same issuer and options, warrants or rights to or interest in any such securities). The information and opinions
contained in this document have been compiled from or arrived at in good faith from sources believed to be reliable. No representation or
warranty, expressed or implied, is made by PT CIPTADANA SEKURITAS ASIA or any other member of the Ciptadana Capital, including any
other member of the Ciptadana Group of Companies from whom this document may be received, as to the accuracy or completeness of the
information contained herein. All opinions and estimates in this report constitute our judgment as of this date and there can be no
assurance that future results or events will be consistent with any such opinions, forecasts or estimates. The information in this document
is subject to change without notice; its accuracy is not guaranteed; and it may be incomplete or condensed.

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