Silver Point

Thomas J. Monaco

Independent Insight Provider

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

*Solid Result, But Challenges Ahead: Bank Central Asia (BBCA.IJ) [BCA] reported 3Q21 results of IDR 8.7 tn, improving IDR 1.3 tn (17.9%) on a linked quarter basis. BCA’s positive operating performance was highlighted by a loss provision cut of 66.5%, a slightly reduced tax rate, and a modest decline in costs; and*Credit Challenges Abating: By our calculation, we find that 3Q21 net new NPLs amounted to IDR 942 bn for an annualized rate of increase of 27.2%, and comparing very favorably to the 92.4% rate in 2Q21. Despite the significant deceleration in net new NPL formation, we calculate that loss reserves are likely right where they need to be.

*Solid Result, But Challenges Ahead: Bank Central Asia (BBCA.IJ) [BCA] reported 3Q21 results of IDR 8.7 tn, improving IDR 1.3 tn (17.9%) on a linked quarter basis. BCA’s positive operating performance was highlighted by a loss provision cut of 66.5%, a slightly reduced tax rate, and a modest decline in costs; and*Credit Challenges Abating: By our calculation, we find that 3Q21 net new NPLs amounted to IDR 942 bn for an annualized rate of increase of 27.2%, and comparing very favorably to the 92.4% rate in 2Q21. Despite the significant deceleration in net new NPL formation, we calculate that loss reserves are likely right where they need to be.

Bank Central Asia – Substantial Credit Delta Improvement