OJK Boss: Banking Credit Restructuring Will Be Revocational In March 2023

JAKARTA - The Financial Services Authority (OJK) reiterated the plan to revoke the credit easing policy affected by the COVID-19 pandemic in the banking sector. This was conveyed directly by the Chairman of the OJK Board of Commissioners Mahendra Siregar.

According to him, the discourse is based on facts on the ground which states that intermediation continues to strengthen.

"Throughout 2022, bank COVID-19 restructuring credit has decreased significantly," he said at the 2023 Financial Services Industry Annual Meeting in Jakarta, Monday, February 6.

Mahendra noted that the value of credit calculations that were restructured at the end of last year was IDR 469 trillion.

"This number is much lower than the peak that occurred in October 2020 with a value of Rp830 trillion," he said.

Mahendra explained that the positive signal was supported by an increase in coverage of 24.3 percent of the total credit that received the facility.

"So it can be interpreted that we are ready to end the restructuring period at the end of March 2023," he said.

Even so, the OJK boss stated that the decision had exceptions to sectors that were deemed to still have a high level of vulnerability.

"Except for some labor-intensive sectors which will be extended until March 2024," he added.

For information, pandemic control which continues to strengthen the banking services industry. This indication can be seen from the growth of credit in 2022 which has managed to penetrate the double digit level, which is around 11 percent.

Meanwhile, this year the authorities are targeting banking intermediation to be perched in the range of 10 percent to 12 percent.

"The revocation of the credit restructuring policy is in line with the government's plan to receive WHO advice regarding the decline in the status of the COVID-19 pandemic," Mahendra concluded.