TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search results
Popular Reads
Top Results
No results found. Please check your search term and try again
Can't find what you're looking for?
View all search resultsBad loans creep up in May amid sluggish bank loan growth
In May, BI revised down its projection for loan growth this year, from 11–13 percent to 8–11 percent.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
Economic hub: Office towers housing banks and corporations are seen on Dec. 12, 2023, at the Sudirman Central Business District in Jakarta. (AFP/Yasuyoshi Chiba )
I
ndonesia’s banking industry has seen an increase in bad loans amid slower loan growth, as the country’s economy has taken a hit from global uncertainty.
According to the Financial Services Authority (OJK), local banks’ non-performing loans (NPL) increased to 2.29 percent in May, up from 2.24 percent noted in the preceding month and 2.08 percent in December last year.
Additionally, the share of loans at risk (LAR) grew slightly to 9.93 percent from the 9.92 percent seen in April. The latest figure reflects an upward trend compared to 9.28 percent in December last year.
“Despite having an increase compared with the previous month, the ratio of LAR remained stable and below the pandemic level,” Dian Ediana Rae, head of banking supervision at the OJK, said at a press conference on Tuesday.
Dian further explained that the banking sector remained resilient and strong, noting that it had reached a capital adequacy ratio of 25.51 percent, higher than the minimum threshold of 8 percent.
“This is a very strong buffer for risk mitigation amid the current global uncertainty,” he added.
Read also: OJK expects ‘minimal’ impact on NPL as loan restructuring program ends
