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Jakarta Post

Pandemic loan restructuring scheme nears $70.5b

  • The Jakarta Post

Jakarta   /   Thu, March 4 2021   /  01:00 am
Easy money: A craftsman completes a bamboo-made becak (pedicab) miniature in Cimangenteung village in Lebak, Banten, on July 8. Banks are offering unsecured loans for small-scale enterprises, among other customers.(Antara/Muhammad Bagus Khoirunas)

The country's loan restructuring program has reached nearly Rp 1 quadrillion (US$70.5 billion) as borrowers reel from economic downturn during the pandemic. The Financial Services Authority (OJK) reported Friday the amount of restructured loans was recorded at Rp 987.48 trillion as of Feb. 8, involving 101 banks. Some 39.3 percent are from 6.15 million small business borrowers and the rest is from 1.79 million other borrowers. The loan restructuring program has led to increases in the loan-at-risk ratio (LAR) to 23.38 percent in December last year, up from 9.93 percent in December 2019. “This means that we know many borrowers have been affected by the pandemic, so they have to restructure and thus show up in the LAR,” Bambang Widjanarko, the deputy commissioner of banking supervision II at the OJK, said in a virtual briefing. “If we look at the tren...