BCA, Bank Syariah Indonesia on track for double-digit profit growth

Indonesian banks are in-line to deliver profit growth.

Indonesia banks are on track to deliver net profit growth in the 2024/25 fiscal year, according to a report by UOB Kay Hian.

Bank Central Asia (BCA) and Bank Syariah Indonesia (BRIS) may deliver double-digit net profit growth for period.

Bank Negara Indonesia (BNI), Bank Mandiri, and Bank Rakyat Indonesia (BRI) could book low-to-mid single-digit net profit growth over the same period.

The estimates are based on their results for the first 11 months of 2024. Based on this, BBCA was least impacted from the high cost of funds (CoF) and tighter liquidity environment.

BRIS, meanwhile, recorded a 7.6% year-on-year (YoY) earnings growth, which may be due to its strong long growth, strong non-interest income, and lower credit cost, said UOBKH analyst Posmarito Pakpahan.

Overall, Indonesian banks’ net profit should be in line with UOBKH and the market’s expectations, Pakpahan said.

Factors that could impact their earnings in 2025 include uncertainties in whether the local central bank will proceed with assumptions of a 100 basis point rate cut; higher government debt, which could affect the competition of gathering deposits for banks; and if the government decides to change the top management of state-owned banks.

Separately, BRI is expected to continue its restructuring in the second half of 2025.