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Loan Growth Hits Double Digits: OJK Chief
Chief of the Board of Commissioners of the Financial Services Authority (OJK) Muliaman D. Hadad when arrived for meeting with Commission XI House of Representative in parliament, Jakarta, Feb. 7, 2017. TEMPO/Dhemas Reviyanto
Wednesday, 14 June, 2017 | 06:58 WIB
Loan Growth Hits Double Digits: OJK Chief

TEMPO.CO, Jakarta - The Financial Service Authority (OJK) chief commissioner Muliaman Hadad said that loan growth hit 10.39 percent in May. State-owned lender loans even grew 14 percent last month. "The economic sectors remain the same, standard. Infrastructure, construction, agriculture, and trade sectors," he said.

According to Muliaman, bank loans grew in a quite promising fashion because demands were evenly distributed in each sector. "Though I was informed about a little slowdown, particularly in retail business, it is yet to be seen in credit demands."

Read also: OJK Records Credit Growth of 9.2 Percent

Third party funds has also tend to increase as bank loan grew. "NPL [non-performing loans] tend to go down, very slightly, still above three percent. Stronger credit means that NPL decrease may still happen," Muliaman said.

Earlier, state-owned lender Bank Mandiri president director Kartika Wirjoatmodjo has planned to raise the company’s term deposit interest rates in the second half of the year. He reasoned that an increase would be needed considering Bank Mandiri loans as of April had hit 9 percent.

Read also: OJK to Revise Loan Growth Target

"I suspect that in June it could go above 10 percent. [Loan] growth in the first half has be rough because we had a lot of holidays," Kartika said. "In the second half all banks will step up and in increase will start happening."

Kartika said that if bank loan grows above 10 percent, liquidity will tighten. More so because in the first quarter of 2017 most of Bank Mandiri funds were shifted to bonds. "If loan growth increases, term deposit [interest rates] will increase as well," he said.




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