Bank Indonesia (BI) is optimistic that loan growth will reach double digits this year, according to the central bank’s deputy governor, Erwin Rijanto.

“In our projection, loan growth this year will be better than last year, and next year will be better than this year,” Erwin said in Jakarta on Friday, adding that loan growth in February was encouraging.

Loans had grown by 8 percent year-on-year (yoy) in February, up from 7 percent booked in the previous month, Erwin said.

BI had previously projected loan growth of 10 to 12 percent this year, beating last year’s 8.2 percent.

Erwin said one of the drivers of loan growth was the end of corporate consolidation. “The corporates have ended their consolidation, so they have started to pick up,” said Erwin.

Despite the expected increase in loan growth this year, the risk of an increase in non-performing loans (NPL) remained minimal, he added.

“As for the NPL [ratio], I think it has already decreased significantly. So, in my opinion, we now only have to wait for the momentum of economic growth [to drive loan demand],” he said.

He also highlighted the government’s infrastructure spending and household spending as drivers of economic growth. (bbn)

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