Healthier Banking, LPS Record Zero Liquidation This Year

LPS press conference in Nusa Dua, Bali. (Photo: Doc. Antara)

NUSA DUA - Chairman of the Board of Commissioners of the Deposit Insurance Corporation (LPS) Purbaya Yudhi Sadewa said that his party has not liquidated or closed banks throughout 2022. This indicates that banks are still healthy.

"Every year, six to seven Rural Banks (BPR) close (liquidation), but this year 0, meaning the situation is improving, that's BPR. Moreover, Regional Credit Banks (BPD), especially commercial banks, the situation is really improving," he said. after the Press Conference related to the LPS International Seminar as quoted by Antara, Wednesday 9 November.

Previously, LPS estimated that at least eight BPRs would be closed this year, but it turns out that banks are getting healthier in line with the economic recovery from the impact of the COVID-19 pandemic.

"The policies made by the Financial System Stability Committee (KSSK) are appropriate, the policies are sufficient in the system, and the economy is still encouraged to grow above 5.7 percent," he said.

As for the loan at risk (LAR) of banking in an area that is quite high, for example in Bali, which reached 71 percent of total loans worth Rp. 8 trillion, he hopes that banking conditions will improve as the economy moves back.

"Bali is an area that has been hit deeply because its economy is mainly from tourism, but tourism has started to open in the last two months," he said.

With the recovery of the tourism sector in Bali, mainly due to various international agendas such as the Indonesian G20 Presidency, the economy in Bali is working to grow so that the LAR of banking in Bali is also gradually decreasing.

"As of now, there is no LPS bank closure in Bali. There are banks that are sick, but there are banks in the past, while there are no new banks," he said.