BBRI - Targeting LAR to fall to the range of 9% to 10%

BBRI - Targeting LAR to fall to the range of 9% to 10% Bank Rakyat Indonesia (BBRI) is optimistic that it can continue to improve the quality of its credit. This is reflected in BRI's Loan at Risk (LAR) target for next year, despite global economic conditions become increasingly volatile. According to the bank, it is targeted that next year LAR will reach in the range of 9% to 10%. As of 9M23 LAR was 13.8% or improved year-on-year from 19.3%. (Source: Kontan). Comment: We believe LAR would continue to drop as asset quality recovery will remains intact. Front load effort to maintain credit quality will also overall help the cost of credit. Even on the scenario write off should be made, we view the overall coverage and others related credit quality metrics will arrives at around the level in pre pandemic.