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Jakarta Post

Bank credit growth slowdown in Q3: BI survey

  • News Desk

    The Jakarta Post

Jakarta   /   Wed, October 17, 2018   /   01:21 pm
Bank credit growth slowdown in Q3: BI survey The Bank Indonesia logo on the gate of its Jakarta headquarters. (Antara/File)

Bank Indonesia on Tuesday released a survey of 40 banks representing 80 percent of total bank credit, which showed slow growth of bank credit in the third quarter of 2018.

BI communications director Agusman said the slow credit growth was reflected in the net weighted balance in the third quarter, which decreased to 21.2 percent from 90.3 percent in the previous quarter.

The credit demand for working capital declined from 90.2 percent to 69.9 percent in the previous quarter; the credit demand for investment declined from 73.8 percent to 68.9 percent, and for consumption it declined from 36.6 percent to 26.8 percent.

Agusman, however, said bankers were still optimistic about the prospect of credit growth in the whole of 2018.  Respondents saw that the average credit growth in 2018 was 11.5 percent, higher than the credit growth in 2017, which was recorded at 8.2 percent.

The optimism was triggered by the expected higher economic growth this year and the decline of credit distribution risk, Agusman said as quoted by kontan.co.id.

The survey shows that the slowdown in credit growth was particularly sparked by the decline in automotive credit from 40.3 percent in the second quarter to 20.9 percent in this quarter.

On the other hand, the demand for housing credit has increased from 42.9 percent to 66.7 percent, which is considered to have occurred as a result of the relaxation of the loan to value ratio for mortgages by the central bank. (bbn)