I N V E S TO R N E W S L E T T E R

February 2023

Fitch Upgrades BRI rating to 'BBB' and 'AAA(idn)' with stable outlook

On February 1st 2023, Fitch ratings has upgraded PT Bank Rakyat Indonesia (Persero) Tbk's (BRI) Long-Term Issuer Default Rating (IDR) to 'BBB' from 'BBB-' and BRI's National Long-Term Rating to 'AAA(idn)' from 'AA+(idn)' with a stable outlook. In addition, Fitch has upgraded the bank's US dollar-denominated senior unsecured notes to 'BBB' from 'BBB-'.

Key rating drivers:

  • Government support considering BRI's systemic importance as one of the largest commercial banks in Indonesia, strategic state ownership & BRI's role in supporting the MSME segment
  • Stable operating environment outlook as GDP growth is likely to be resilient in 2023 and 2024, which should support the industry's loan demand and asset quality
  • Strong Indonesian franchise, as signified by its market-leadingoperating income and very high market share in its core operating segment of MSME lending. This is complemented by adequate diversification and management quality that is comparable with most of its large bank peers
  • Improving asset-quality metrics as Fitch expects
    BRI's NPL's to improve gradually
  • Sustained profitability recovery from high loan growth and lower credit costs given Fitch's expectations for asset quality improvement and adequate loan loss coverage. Fitch expects that the pressure on BRI's net interest margin from rising rates to be partially offset by increasing lending yields due to continued expansion into micro lending
  • Satisfactory capital buffers, the consolidated tier-1ratio of 25.1% provides the bank with a satisfactory buffer against potential asset-qualitydeterioration
  • Stable funding profile, as Fitch expects BRI to maintain satisfactory liquidity at reasonable costs to support the group's operations

For the complete report, please follow the link below: https://www.fitchratings.com/research/banks/fitch-upgrades-bank-rakyat-indonesia-to-bbb-aaa-idn-outlook-stable-01-02-2023

PT BANK RAKYAT INDONESIA (Persero) Tbk.

Investor Relations

Phone

: 62 21 5752006/09

7th floor BRI II Building

Website

: www.ir-bri.com

Jl. Jenderal Sudirman Kav 44-46 Jakarta 10210, Indonesia

Email

: ir@bri.co.id

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BRI - PT Bank Rakyat Indonesia (Persero) Tbk published this content on 02 February 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 February 2023 13:20:02 UTC.