The Jakarta Post
The Indonesian Banks Association (Perbanas) projects third-party funds in banks to grow slower at between 6 and 7 percent in the first half of 2019, but the association expects higher growth in the following quarter.
Perbanas chairman Kartika Wirjoatmodjo said the growth in the second half could reach around 10 percent, making the average growth in 2019 8 to 9 percent.
“It’s not possible to exceed 10 percent, [next year],” said Kartika, who is also president director of state-lender PT Bank Mandiri, after speaking at the Market Outlook Mandiri event in Jakarta, as reported by kontan.co.id on Friday.
Third-party funds in banks grew 6.3 percent in the first eight months of 2018, according to the data released Bank Indonesia (BI).
Kartika pointed several factors that sparked the slow growth of third-party funds, including portfolio outflow from the country triggered by the United States dollar strengthening in the first half. He expressed his optimism that the portfolios would gradually flow back into Indonesia.
It was also caused by the issuance of government debt papers (SUN) in large amounts that would absorb funds from individuals, he said, adding that the government debt papers were expected to be absorbed in the first half of 2019 so that the banking sector would receive more third-party funds in the second half.
He added that the Idul Fitri holiday in the first half of 2019 would also contribute to the pressure to the flow of third-party funds to the banking sector because the people would spend more during the seasonal holiday.
Meanwhile, Kartika said banking credits would still grow in double digits, next year, similar to the growth in the third quarter of 2018, which was at between 13 and 14 percent. (bbn)