BMRI - Soft 1Q24 earnings growth

BMRI - Soft 1Q24 earnings growth Bank Mandiri (BMRI) closed the first quarter of 2024 with an increase in consolidated net profit of around 1.13% on an annual basis yoy. The increase in Bank Mandiri profits was still supported by net interest income reaching 5.11% yoy. The income value was IDR24.18 tn. Meanwhile, the net interest income was hampered by interest expenses which appeared to have increased significantly. Bank Mandiri and its subsidiaries also continued to record credit growth in this period. It was recorded that credit distribution reached IDR1,429 tn or an increase of 2.73% year to date. In terms of savings, Bank Mandiri has collected Third Party Funds (DPK) worth IDR1,573.74 tn in the first three months of 2024. At the end of the year, Bank Mandiri's DPK was recorded at IDR1,578.82 tn. (Source : Kontan). Comment : We accept soft earnings growth amid the continuing transmission of benchmark rate increase. Key would be the potential room for yield repricing, the remaining and average 4Q23 and 1Q24 loan growth which likely to record the latest loan yield (higher) vs last year figure. Steady CIR improvement, stable stronger CASA growth and continuing soft provisions are another key catalyst.