BI Rate Rises, Bank Liquidity Is Still Sufficient

Rupiah (Photo: Antara)

SAMOSIR - Bank Indonesia (BI) assesses that National banking liquidity is still quite adequate. Although, there was a decrease in the banking credit growth target due to the increase in the BI or BI-Rate benchmark interest rate to 6.25 percent.

Director of the Nugroho Macroprudential Policy Department, Joko Prastowo, said that national banking liquidity is still quite adequate, as seen from the Liquid Equipment for Third Party Funds (AL/DPK) reaching 27 percent.

According to Joko, the strict banking liquidity problem is a problem of the individual bank itself.

"The term is not a banking industry problem, but several individual banks, so this can be seen from the fact that the banking Navy/DPK is still very high, still 27 percent," said Joko in a discussion on the Latest Economic Developments and BI Policy Mix Response, in Samosir Regency, North Sumatra, Sunday, April 28.

Joko said that at the time of Covid-19 there were banks that did not distribute credit and chose to store various instruments such as state securities (SBN).

According to Joko, several banks, if they buy large amounts of SBN, the bank will not sell all of them which will have an impact on strict liquidity.

"If you buy them, most of them are SBN and then all investment portfolios cannot be sold, so when you distribute credit, the credit must rely on DPK," he explained.

Meanwhile, BI has again expanded the priority sector of the Macroprudential Liquidity Incentive Policy (KLM) by increasing banking liquidity by IDR 81 trillion in mid-2024. Thus, the total incentives provided are IDR 246 trillion.

Furthermore, in line with the increasing credit growth, additional liquidity from KLM is predicted to reach IDR 115 trillion by the end of 2024, bringing the total incentives provided to IDR 280 trillion.