JAKARTA (TheInsiderStories) - Bank Indonesia (BI) expects bank industry loan to grow by between 10 to 12 percent in 2017, supported by the improved economic growth in the coming year, Senior Deputy Governor of BI Mirza Adityaswara said, the economic growth in 2017 is expected to keep its upward trend, ranging from 5.1 to 5.5 percent.
Chairman of the Financial Services Authority (OJK) Muliaman Hadad has revised loan growth target this year to 6-8 percent, after looking at loan growth in the first eight month of this year. Mirza said in the period of January to August, the bank loans grew by 6.63 percent compared to the same period last year.
BI Governor Agus Martowardojo stated, the credit growth continued to decline in line with the weakening of the world economy and the impact on the national economy. However, on the other hand, the rise of exports in the period gives hope to the future loan growth.
BI also sees encouraging growth of capital market instruments this year such as corporate bonds, driven by lower interest rates. He said,”This year, we expect the (bonds) issue to reach Rp120 trillion.”
On the other hand, Muliaman said, to boost the loan growth in the 2017, OJK will try to find the sources of the driving intermediation for the bank. Recently, BI has lowered its 7-day repo rate by 25 basis points to 4.74 percent and forcing banks to cut their lending rates.
“We have asked banks to mitigate the risks arising from the loss of shocks, encountered by banks. At present, the capital structure of banks is still quite strong, the CAR are still at the level of 23 percent,” he said after attending Financial System Stability Committee (FSSC) meeting at Finance Ministry office.
Finance Minister Sri Mulyani Indrawati said, based on the FSCC assessment, financial system stability in third quarter of this year remained in good condition and pressure on the rupiah has eased, fiscal performance and stock market performance improved, while the financial institutions condition was still well preserved.
Despite this, the FSCC will continue to monitor closely the risks of domestic and external factors that can affect the stability of the financial system by the end of 2016.