The BEM, known as solving boundary value problems, could have some advantages In solving domain problems which are mostly solved by FEM and FDM. Lately, in the elastic-plastic nonlinear problems, BEM could provide the subdomain approach for the region where the plastic deformation could occur and the unknown nodal displacement of this region are added as the unknown of the boundary integral equation for this approach. In this paper, initial stress method was used to establish the formulation of such BEM approach. And a simple rectangular plate having a circular hole was analyzed to verify the suggested method and the result is compared with that from FEM. It is shown that the result of two methods are showing similar stress-strain curves at the root of perforated plate and furthermore the plastic deformation obtained by BEM shows more reasonable behavior than that of FEM.