JAKARTA. The quite rapid credit growth caused banks to reduce their placement of funds in securities and divert them to lending.
The Indonesia Banking Statistic (SPI) released by the Financial Services Authority (OJK) showed that as of March 2019, total bank loans had reached Rp 5,291.23 trillion, 11.55% growth on year on year (YoY) basis.
As a result, the placement of bank funds in securities in March shrank to Rp 1,062.43 trillion from Rp 1,135.95 trillion, a 6.42% drop.
Finance Director of PT Bank Negara Indonesia Tbk (BNI),Anggoro Eko Cahyo, said that BNI's securities portfolio in March 2019 fell by 7.2% (YoY) to Rp 101 trillion. "The decline in the number of securities that are switched into credit is an effort to increase interest income and bank margins," Anggoro said as quoted by Kontan.co.id, Tuesday (21/5).
According to Anggoro, BNI has considered this step. Because basically, the placement of bank funds in securities is a strategy to manage liquidity, and to follow the direction of market movements.
Corporate Secretary of PT Bank Central Asia Tbk (BCA) Jan Hendra said as of March 2019, the placement of BCA funds into securities was still stable. "In terms of liquidity, BCA's LDR ratio as of March 2019 is stable in the range of 80% -81%, so it still has the ability to get opportunities," said him.
According to Hendra, the placement of funds in securities is carried out by banks to achieve optimal returns according to business conditions. (AM/AR)