Company Coverage
Bank Tabungan Negara (BBTN IJ): 2Q26: Earnings Beat On CoC; Consumer Banking Gains Momentum
BUY (Maintained)
Current price:
Target price:
Upside:
Rp1,260
Rp1,565
+24.2%
Analyst
Highlights
- 2Q26 net profit jumped 16.8% qoq (+61.3% yoy), beating our and market expectations, driven by lower-than-guided credit costs despite weaker core operating profit from yield normalisation.
- Beyond Mortgages strategy continues to gain traction, supported by pension loan acquisitions, ecosystem expansion, digitalisation and improving fee income diversification.
- Maintain BUY with a target price of Rp1,565. Improving asset quality, disciplined funding management and structural earnings transformation should support resilient profitability amid tighter system liquidity.
Analysis
• 2Q26 net profit jumped 16.8% qoq, above expectations. Bank Tabungan Negara’s (BBTN) 2Q26 net profit came in at Rp1.3t, surging 16.8% qoq (+61.3% yoy), bringing 1H26 earnings to Rp2.4t (+40.8% yoy), above our/consensus expectations at 66%/62% of full-year forecasts. The earnings beat was primarily driven by a 130bp yoy decline in credit cost (CoC), with 1H26 CoC standing at 0.7%, lower than management’s guidance of 1.0-1.2%. Nonetheless, 1H26 pre-provision operating profit (PPOP) dropped 22.8% yoy to Rp4.5t, mainly due to yield normalisation after an adjustment in 2025.
• Consumer banking transformation gains momentum. The earnings call highlighted the bank’s transformation progress from a mortgage-focused lender into a broader consumer bank. The strategy is centred on expanding higher-yield non-housing loans through the acquisition of pension loan portfolios, while strengthening ecosystem-driven banking across healthcare, education, tourism and lifestyle. At the same time, the rapid expansion of Bale by BBTN is expected to deepen customer engagement, diversify earnings and improve cross-selling opportunities beyond traditional mortgage financing.
Highlights
- 2Q26 net profit jumped 16.8% qoq (+61.3% yoy), beating our and market expectations, driven by lower-than-guided credit costs despite weaker core operating profit from yield normalisation.
- Beyond Mortgages strategy continues to gain traction, supported by pension loan acquisitions, ecosystem expansion, digitalisation and improving fee income diversification.
- Maintain BUY with a target price of Rp1,565. Improving asset quality, disciplined funding management and structural earnings transformation should support resilient profitability amid tighter system liquidity.
Analysis
• 2Q26 net profit jumped 16.8% qoq, above expectations. Bank Tabungan Negara’s (BBTN) 2Q26 net profit came in at Rp1.3t, surging 16.8% qoq (+61.3% yoy), bringing 1H26 earnings to Rp2.4t (+40.8% yoy), above our/consensus expectations at 66%/62% of full-year forecasts. The earnings beat was primarily driven by a 130bp yoy decline in credit cost (CoC), with 1H26 CoC standing at 0.7%, lower than management’s guidance of 1.0-1.2%. Nonetheless, 1H26 pre-provision operating profit (PPOP) dropped 22.8% yoy to Rp4.5t, mainly due to yield normalisation after an adjustment in 2025.
• Consumer banking transformation gains momentum. The earnings call highlighted the bank’s transformation progress from a mortgage-focused lender into a broader consumer bank. The strategy is centred on expanding higher-yield non-housing loans through the acquisition of pension loan portfolios, while strengthening ecosystem-driven banking across healthcare, education, tourism and lifestyle. At the same time, the rapid expansion of Bale by BBTN is expected to deepen customer engagement, diversify earnings and improve cross-selling opportunities beyond traditional mortgage financing.
BUY (Maintained)
Current price:
Target price:
Upside:
Rp1,260
Rp1,565
+24.2%
Analyst
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