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Jakarta Post

Ultra-rich savers to boost bank liquidity

  • Yunindita Prasidya

    The Jakarta Post

Jakarta   /   Wed, June 3 2020   /  09:08 am

The ultra-rich are likely to boost their savings in banks amid the high levels of uncertainty in the overall economy, as banks increase deposit rates to lure funds, economists say.Perbanas Institute economist Piter Abdullah said deposits from high-net worth individuals would increase, defying the trend of an overall slowdown in third-party funds in local banks as lower-income people’s incomes declined as a result of the ongoing COVID-19 pandemic.“My guess is that the third-party funds that will increase are those from savers with assets over Rp 2 billion [US$138,403]. Meanwhile, savings under Rp 2 billion will decrease,” Piter said. Savings under Rp 2 billion, which are fully insured by the Deposit Insurance Corporation (LPS), account for 43 percent of deposits in local banks, while the remaining 57 percent are in accounts with more than Rp 2 billion, LPS data show.Third-party fund...