Bank Mandiri Economist: The Performance Of The Indonesian Banking Sector Is Still Healthy

Illustration. (Photo: Doc. Antara)

JAKARTA - Head of Macroeconomic & Financial Market Research of PT Bank Mandiri Tbk Dian Ayu Yustina said the performance of the banking sector in Indonesia is still healthy amid the failure of three banks in America.

According to him, this is due to the minimal exposure of banking in America to banks in Indonesia.

"Judging from various indicators, our banking resilience is still very good. Our CAR (Capital Adequacy Ratio) still reaches the level above the provisions of 25.88 percent," he said in Media Gathering online, quoted from Antara, Wednesday, May 10.

Indonesia's banking condition is currently also better than during the 2008 global economic crisis where at that time banking capital, which appeared to be from CAR, only reached 16.76 percent.

In the first quarter of 2023, the national banking Loan to Deposit Ratio (LDR) of 79.81 percent was also considered quite good, as well as low non-performing loans (NPL) of 2.59 percent.

Until the end of 2023, he estimates that the national banking LDR can be maintained in the range of 80 percent in line with credit growth of 10.1 percent and Third Party Funds (DPK) of 8.4 percent.

Liquidity is expected to increase in the second semester of 2023 with the DPK growing again by 8 percent from the previous 7 percent growth in the first quarter of 2023.

The weakening of DPK growth in the first quarter of 2023 was caused by seasonal factors where the community made preparations ahead of Ramadan and Eid which fell in the second quarter of 2023.

"So there is indeed a withdrawal of money from banks, this makes our liquidity condition increase. This is seasonal. In the next period, when government spending increases according to season, liquidity should improve," he said.