ID :
71844
Thu, 07/23/2009 - 20:36
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https://www.oananews.org//node/71844
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BANKS` NPLs NOT TO EXCEED FIVE PCT : BI
Medan, Indonesia, July 23 (ANTARA) - The non-performing loans (NPL) of banks are estimated not to exceed five percent this year because in addition to the recovering economy, banks have worked hard to offset their NPLs, a central bank official said.
"Banks' efforts to clear their portfolios have been relatively successful while the real sector is also improving, meaning businesses are recovering. All of this gives us reason to believe that NPLs will not exceed the five percent threshold," BI Deputy Governor S Budi Rochadi said here on Thursday.
Rochadi came here in connection with the transfer of post of BI's Medan branch chief from Romeo Rissal to Gatot Sugiono S.
Besides their success in curbing NPLs, banks were also expected to expand their credits. The credits would expand after they were off-set by the impact of the global financial crisis.
He said banks' credit growth could already be observed in June and this month.
"BI estimates that bank credits will this year still grow by 15 percent from last year. It is true that the growth will be lower than last year when it was 24 to 25 percent. But 15 percent this year is still a high figure considering the circumstances," he added.
s The absorption of third-party funds was also showing an upward trend, reaching Rp1,783 trillion in May 2009 from Rp1,705.3 trillion in late December 2008.
In the meantime, the Indonesian Chamber of Commerce and Industry (Kadin) called on banks recently to lower their interest rates on credits in accordance with BI (the central bank)'s recent action in cutting its key rate by 25 basis points to 6.75 percent.
"I appeal to banks to cut their lending rates soon so that investors will be able to borrow money at relatively lower interest rates," chairman of Kadin's foreign investment committee Chris Kanter said.
He said the lending rates at present were still at the 13 percent level while a fair rate would be in the range of 10 to 11 percent.***
"Banks' efforts to clear their portfolios have been relatively successful while the real sector is also improving, meaning businesses are recovering. All of this gives us reason to believe that NPLs will not exceed the five percent threshold," BI Deputy Governor S Budi Rochadi said here on Thursday.
Rochadi came here in connection with the transfer of post of BI's Medan branch chief from Romeo Rissal to Gatot Sugiono S.
Besides their success in curbing NPLs, banks were also expected to expand their credits. The credits would expand after they were off-set by the impact of the global financial crisis.
He said banks' credit growth could already be observed in June and this month.
"BI estimates that bank credits will this year still grow by 15 percent from last year. It is true that the growth will be lower than last year when it was 24 to 25 percent. But 15 percent this year is still a high figure considering the circumstances," he added.
s The absorption of third-party funds was also showing an upward trend, reaching Rp1,783 trillion in May 2009 from Rp1,705.3 trillion in late December 2008.
In the meantime, the Indonesian Chamber of Commerce and Industry (Kadin) called on banks recently to lower their interest rates on credits in accordance with BI (the central bank)'s recent action in cutting its key rate by 25 basis points to 6.75 percent.
"I appeal to banks to cut their lending rates soon so that investors will be able to borrow money at relatively lower interest rates," chairman of Kadin's foreign investment committee Chris Kanter said.
He said the lending rates at present were still at the 13 percent level while a fair rate would be in the range of 10 to 11 percent.***
