OJK Banking Credit Growth Value is Still Quite Large

OJK Chairman Mahendra Siregar (Photo: Aris Nurjani/VOI)

JAKARTA - The Financial Services Authority (OJK) is also highlighting the performance of banks in Indonesia in collecting and distributing funds throughout this year. Previously, President Joko Widodo also discussed the slow credit growth.

OJK Chairman Mahendra Siregar assesses that currently banks still have sufficient liquidity space to distribute credit, reflected in the deposit to credit ratio (LDR) which is at 83 percent.

Mahendra considers it natural that the growth of credit and third party funds (DPK) this year is slowing because last year the performance of the banking industry had just rebounded due to the COVID-19 pandemic.

"It's natural that it's slightly lower than last year, because it's a big rebound from the pandemic, so now it's still maintained at a growth rate that's more or less the same as pre-pandemic," he explained after the 2023 Risk & Governance Summit, Thursday 30 November.

Mahendra said that his party does not see the potential for an interest rate war because current liquidity conditions are very good and credit conditions still have considerable room for improvement.

According to Mahendra, the thing that needs to be maintained at this time is growth in the real sector because the demand for investment credit and working capital will really depend on the growth of the business world.

"As long as it is maintained and understood, the government really knows this, and it is maintained this year, it will certainly open up very good banking opportunities," he said.