Last Monday, on March 24, precisely on March 24, the GMS of Bank Rakyat Indonesia (BBRI) decided to take a significant step by reshuffling the board of directors and commissioners. Hery Gunardi was appointed as the new president director, replacing Sunarso who has served since 2019. Previously, Hery was the president director of Bank Syariah Indonesia ($BRIS), and now this new boy is ready to bring fresh breath to BRI!

But it is not only the change of position that steals the attention. The shareholders also gave the green light for the distribution of dividends for the 2024 financial year which reached IDR 52 trillion, which means there is a dividend payout ratio of 86% (up from 80% in 2023). This indicates a final dividend of IDR 208.4 per share, with a tempting yield of 5.8% based on BBRI’s closing price at the level of IDR 3,610 per share on that day. Not only that, BBRI has also distributed an interim dividend of IDR 135 per share in January 2025.

Promising Financial Performance

Speaking of performance, last weekend BBRI also announced a net profit of IDR 4.6 trillion for February 2025, showing astonishing growth with an increase of 42% YoY and 129% MoM. This result shows a significant recovery from the previous poor performance, bringing the bank’s total net profit to only Rp6.6 trillion, although it had fallen 18% YoY. This is certainly well below the expected expectations of consolidated growth.

Spotlight Recovery

The recovery of banks’ net profit in February was in the spotlight, in line with the recovery of credit costs (CoC) which began to show a positive trend. The latest data shows that the bank-only CoC in February 2025 will be at the level of 3.28%, decreasing from January which reached 5.57%. This indicates that the supply load is starting to return to a healthier level.

Meanwhile, Net Interest Margin (NIM) also showed signs of recovery, rising to 6.39% in February 2025, thanks to the realization of a fairly good Net Interest Income (NII) and a significant reduction in interest expenses. However, it is noteworthy that operating costs (opex) in February jumped to Rp4.3 trillion, reflecting an increase of 111% YoY, mainly due to increased labor costs.

Focus Ahead

Of course, all these changes raise a big question: What is BRI’s next step under this new leadership? We look forward to the earnings call in the upcoming first quarter to hear strategies and initiatives from Hery Gunardi. In the broader market context, BBRI’s share price will be highly dependent on investor confidence and the overall development of the Indonesian economy.

Conclusion: With the change of directors and an attractive dividend plan, there are many reasons to pay more attention to BRI in the future. Despite the challenges in terms of cost and performance, proactive measures from management are expected to lead BRI towards better performance in the future. Are you ready to tap into this potential?