JAKARTA (TheInsiderStories) – Indonesia’ Deposit Insurance Agency (DIA) predicts, the national loan interest rate will continue to rise is open, but this will run selectively, it said on Monday (02/25).
Directof of Economic Risk and Financial System Stability Group of DIA Doddy Ariefianto said, recently the country’ loan interest rates continued to increase from around 6 percent on January 2017 to 7 percent on January 2019.
“Adjustment of the increase in lending rates is quite open but will be selectively carried out to maintain the potential increase in the ratio of non-performing loans,” he said in a written statement.
The trend has been admitted by President Director of PT Bank Central Asia Tbk (IDX:BBCA) Jahja Setiaatmadja. He said had raised the bank’ credit interest rates by around 50-75 bps. However, this not affected the lender’ loan growth, said the banker.
An opportunities for interest rate to increase also occur in deposit rates. However, Ariefianto believed, the trend will be limited because there are several bank groups that have passed the highest level.
On the other hand, he continued, foreign exchange deposit interest rates are expected to stabilize with a tendency to fall amid improving exchange rate performance and a more dovish Federal Reserves policy direction.
Meanwhile, the agency noted, the average interest rate on Rupiah deposits at the end of January 2018 reached 6.17 percent, up 2 bps from position at the end of December 2018.
The same thing happened at the average minimum interest rate which also rose 5 basis points (bps) to a position of 5.04 percent temporarily interest rates are stable at 7.15 percent.
On the other hand, the rate of foreign exchange deposits in the same period tended to decline, for an average of 4 bps and a maximum of 6 bps.
Furthermore, the loan will continue to grow, but will tend to slow down compared to last year amid the limitations of deposit growth, and the potential for rising lending rates that will affect corporate and consumer behavior in making new loan requests.
Then, the growth of deposits is believed will grow better even though it still remains under loan. “Loan and deposits growth performance for 2019, it is estimated to be in the range of 12.4 percent and 9 percent respectively,” said Ariefianto.
Meanwhile, bank loan growth until the end of November 2018 reached 12.05 percent compared to previous year, while deposits grew 7.19 percent so that the banking loan to deposits in the period was at 93.19 percent.
He noted, the pattern of growth is expected to continue until the end of the year cause the banks will attempt to implement an expansion strategy more active in order to improve financial performance.
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