ID :
18141
Fri, 09/05/2008 - 12:50
Auther :
Shortlink :
https://www.oananews.org//node/18141
The shortlink copeid
CENTRAL BANK WARNS BANKS TO BE PRUDENT IN DISTRIBUTING LOANS
Jakarta, Sept 5 (ANTARA) - Bank Indonesia Governor Boediono advised banks here on Thursday to start exercising prudence in distributing credits.
"We want normal growth to balance with the inflation target. This means that banks must start being prudent in distributing their credits. They must be careful not to make a commitment while the fund for them is not yet secured. So with the signal that we have given, we hope banks would adjust themselves," he said.
The central bank had signalled it would control demands by raising the key rate by 25 points to 9.25 percent. "The decision was made to prevent demands from increasing," he said.
Economic observer Tony A Prasetyantono said the BI rate hike could slow down credit growth in case it went too fast.
"Right now there has been an overheating with credit growth reaching 35 percent and lending to deposit ratio to 76 percent. This, I think, must be controlled. The rate hike would force banks to raise their lending rate to control credit distribution," he said.
Tony said the rate hike was also needed to overcome liquidity problems in banks.***
"We want normal growth to balance with the inflation target. This means that banks must start being prudent in distributing their credits. They must be careful not to make a commitment while the fund for them is not yet secured. So with the signal that we have given, we hope banks would adjust themselves," he said.
The central bank had signalled it would control demands by raising the key rate by 25 points to 9.25 percent. "The decision was made to prevent demands from increasing," he said.
Economic observer Tony A Prasetyantono said the BI rate hike could slow down credit growth in case it went too fast.
"Right now there has been an overheating with credit growth reaching 35 percent and lending to deposit ratio to 76 percent. This, I think, must be controlled. The rate hike would force banks to raise their lending rate to control credit distribution," he said.
Tony said the rate hike was also needed to overcome liquidity problems in banks.***
