JAKARTA (TheInsiderStories) – The problem of liquidity is still considered to be a banking challenge this year. This is because banks must compete not only with other competitors, but also with the government in raising funding.
President Director of Bank Central Asia (IDX:BBCA) Jahja Setiaatmadja said the difficulty of banking liquidity could be seen from the banking industry’ loan to funding ratio (LFR), which currently reached 93 percent. He think the situation are in an irreversible condition.
He noted, when the loan is double digit growth, the banks will be worried about the availability of liquidity. Moreover, Setiaatmadja rated, in collecting funding, banks do not only compete with other banks but also compete with the government.
As is known, the government is now actively offering Saving Bond Retail (SBR) in order to attract investors put their funds in the instrument. With the coupon 8.15 percent and the tax is cheaper then the corporate bond. He comments: “It will be a cannibal, we must look for replacing. that happened.”
On the other hand, Governor of Bank Indonesia (BI) Perry Warjiyo stated that the central bank will continued to monitor the condition of banking liquidity in the country. In order to maintain adequate bank liquidity, he explained, in November last year BI has relaxed the Statutory Reserves policy. He also requested that the Regional Development Bank repurchase four percent of its deposits to increase the liquidity.
The Economic Observer from Indef Aviliani also confirmed the existence of liquidity problems in the banking sector. She said, the commercial bank loans in November 2018 grew by 12.33 percent in annual basis (YoY) and deposits only grew by 7.19 percent (YoY). This condition will trigger liquidity drought and interest rate war.
In terms of the loan to deposit ratio ratio, it has continued to increase since December 2017, which is at 90.04 percent and reached its peak in September 2018 at 94.04 percent.

While, Chairman of Financial Service Authority Wimboh Santoso said, banking is not going to face liquidity problem for this year because foreign investor’ portfolio will flow to Indonesia. Moreover, he stated, BI will respond shortly when there is problem of liquidity in banking by issue many instruments and policies.

Furthermore, Santoso said, increasing of instruments in market will not affect banking liquidity, because the money will flow to bank eventually. He also revealed that only bank which have capability to save the money.
by Linda Silaen and TIS Intelligence Team