Net Interest Margin: BI Cut Rates Five Times, and BBCA's Margin Fell 50 Basis Points
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6 min read
Bank Central Asia (BBCA) told investors its margin fell from 5.8% to 5.3% in the first half of 2026. That is 50 basis points gone in one year, at the most profitable bank in Indonesia. Bank Rakyat Indonesia (BBRI) lost only 18 basis points over the same stretch.
Same country. Same central bank. Same five rate cuts in 2025. Different result. The number that explains it is net interest margin, or NIM. Here is what it is, what it did at the three biggest banks, and why it does not move the same way for everyone.
A bank makes money on a spread. It pays you a little interest on your deposits, and it charges borrowers more interest on loans. Net interest margin is that spread, measured against everything the bank has put to work earning interest.
A basis point (bps) is one hundredth of a percent. So a fall from 5.8% to 5.3% is 50 bps.
Why it matters for a bank stock: interest is the biggest source of income for a bank. When the spread shrinks, profit has to come from somewhere else, such as more loans or lower costs.
Bank Indonesia cut its policy rate (the BI Rate) five times in 2025, by 25 bps each time, from 6.00% to 4.75%. In 2026 it flipped. It raised the rate in May, then again on 9 June and 18 June, taking it to 5.75%. Our earlier post on what the five 2025 cuts did to the IHSG has the full table.
A rate move does not hit a bank all at once. Loans and deposits reprice at different speeds. That timing gap is the whole story below.
Here are the latest reported figures. Each bank states its own numbers, and they are not measured over identical periods, so read the last column carefully.
| Bank | NIM, first half 2026 | Compared with | Change |
|---|---|---|---|
| Bank Central Asia (BBCA) | 5.3% | 5.8% a year earlier | About −50 bps |
| Bank Rakyat Indonesia (BBRI) | 6.40% | 6.58% a year earlier | −18 bps |
| Bank Mandiri (BMRI), Q2 2026 | 4.56% | 4.70% in Q1 2026 | −14 bps in one quarter |
Sources: BBCA and BBRI first-half 2026 results as reported by Kontan, Bareksa, Bisnis.com and IDN Financials. Bank Mandiri's second-quarter NIM as reported by Bisnis.com and Kontan. Retrieved 30 September 2026.
Notice that Mandiri's row compares two quarters, not two years. Do not line it up against the other two.
Start with the cuts in 2025. When BI cut, banks lowered what they charged on new loans quickly, because competitors were doing the same. But banks could not lower what they paid on deposits as fast, especially to large depositors who shop around.
BCA's own explanation, reported by Kontan, is that the margin fall follows the loan rate cuts banks made through 2025, and that this effect carried into the first quarter of 2026 before BI began raising rates again in May.
Then the hikes came, and the squeeze changed shape. Bank Indonesia data showed the average lending rate at 8.81% in June 2026, while the 12-month deposit rate jumped to 5.44% from 4.50% a month earlier. Deposit costs rose faster than loan yields. Mandiri's own deposit cost rose to 2.04% in Q2 from 1.97% in Q1.
In plain words: cuts squeezed the earning side first. Hikes squeezed the paying side first. Either way, the spread got thinner.
Three things make one bank's NIM behave differently from another's.
What the bank lends. BBRI's margin sits near 6.4% and Mandiri's near 4.6%. A bank that lends more to small and micro borrowers usually charges higher rates than one weighted toward large corporate loans. That is a structural reason the levels differ, not just the changes.
What the bank pays for funds. BCA is known for a large base of everyday current and savings accounts, which cost little. A bank that relies more on time deposits has to raise what it pays faster when rates rise and liquidity gets tight.
How much of the loan book reprices. Most loans were written at yesterday's rate. Only floating-rate and new loans move quickly. Our earlier look at the BI Rate versus actual bank lending rates shows how slowly the average loan rate actually follows.
Mandiri responded by cutting its full-year 2026 NIM target to 4.3% to 4.5%, from 4.5% to 4.7%, citing higher funding costs and tighter liquidity, per Bisnis.com. BCA's management, by contrast, said it expects NIM to recover to around 5.4% to 5.6% by year end, according to the same round of first-half reporting. These are the banks' own forecasts. They can be wrong.
Here is the twist. BBRI's NIM fell, yet its net profit rose 17.5% to Rp31.18 trillion in the first half of 2026, from Rp26.53 trillion a year earlier. Net interest income still grew 9.9%, because the bank made more loans. Mandiri's profit rose 24.4% to Rp30.4 trillion. BCA's profit grew only about 2% to Rp29.5 trillion.
NIM is a rate. Interest income is a rate multiplied by a balance. A bank can earn a thinner spread on a much larger loan book and still make more money. So NIM is one piece of the picture, not the verdict. Also look at loan growth, funding costs and bad loans.
When a BI decision lands, do not guess which bank benefits. Look at three numbers in each bank's quarterly report: NIM, cost of funds and loan growth. Then compare the direction across quarters, not just one figure.
Open NetWort's asset page for BBCA to see how the stock itself has traded through this cycle, and use the Macro Context page to see where the BI Rate stands right now. Pick one bank you follow, write down its last four NIM readings, and see which way the line is heading.