Banking Credit Growth Hits 2024 Lowest Level

Monday, 04 Nov 2024

By ferry@insightinnews.com The Financial Services Authority (OJK) reported that the growth rate of bank credit has slowed down as of September 2024. In fact, the credit growth reached its lowest level in 2024. OJK's Executive Director of Banking Supervision, Dian Ediana Rae, stated that in September 2024, the annual credit growth was 10.85 percent, down from 11.40 percent in the previous month. "As of September 2024, credit growth continued to show double-digit growth at 10.85 percent, down from 11.40 percent, totaling Rp 7,579.25 trillion," she said at a press conference on Friday, November 1, 2024. Despite the slowdown, the quality of bank credit has improved, reflected in the gross non-performing loan (NPL) ratio, which decreased to 2.21 percent, while the net NPL remained stable at 0.78 percent. Additionally, the loan at risk (LaR) has also shown improvement. In September, the banking LaR was 10.11 percent, lower than the previous month's 10.17 percent. "This LaR is approaching the pre-pandemic level of 9.93 percent recorded in December 2019," Dian noted. On the other hand, third-party funds (DPK) in banking grew more rapidly, increasing by 7.04 percent in September to reach Rp 8,721 trillion. OJK assessed that the liquidity condition in banking remains stable, with the liquidity ratio (AL) to non-core deposits (NCD) at 112.66 percent and AL to DPK at 25.40 percent.

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