Interest Rates Rise, Bank Jatim Still Wait And See

PT Bank Pembangunan Daerah Jawa Timur Tbk (bankjatim) conveyed the company's strategy in the midst of Bank Indonesia's decision to raise the benchmark interest rate to 6.25 percent.

The President Director of Bankjatim, Busrul Iman explained, with the increase in BI's benchmark interest rate, it would practically raise other interest rates. However, his party decided to take a wait and see step.

Busrul said, there are two ways for the company to address the decision to increase the benchmark interest rate. First, raise interest rates, but his party still has to look at market capabilities.

"For what reason do I increase it and then create a new NPL. So it feels like we looked inside first, is there efficiency that we can do, such as reducing the cost of funds," he said at a press conference in Jakarta, Monday, April 29.

By reducing the cost of funds, the lending rate thrown by the bank will be more accepted by customers so that it can increase the company's profit.

The second step, he continued, is to maintain the ratio of non-performing loans or NPL, his party needs to take several concrete steps. In the midst of the situation, Busrul's high cost of funds states that it is necessary to map or map the company's internal conditions. Moreover, the company's current LDR in the first 3 months in 2024 reached 70 percent so that there is still room for growth for credit.

"Our outstanding is still able to grow. Markets and productive sectors grow exponentially. Our NPL is also still maintained and even yoy has decreased. This is a positive situation for us as BPD," he concluded.

Just so you know, the bank in the first quarter of 2024 was able to record credit growth of 18.76 percent yoy.

This figure is above the national average growth of only 12.40 percent yoy with a consumptive credit composition of IDR 31.3 trillion, an increase of 7.40 percent yoy and productive credit of IDR 25.6 trillion, an increase of 36.34 percent yoy.