Loan growth predicted to slow down in Q1-2020
JAKARTA. The Bank Indonesia (BI) Banking Survey has indicated that the quarterly growth of new loans rose in the fourth quarter of 2019 and is predicted to slow down in the first quarter of 2020.
The development is reflected from the weighted net balance of new loan demand in Q4-2019 of 70.6%, higher than 68.3% in the previous quarter but lower than 71.7% in Q4-2018.
By use, the increasing demand of new loans was mainly sourced from investment and consumption loans, while new loans are predicted to slow down in Q1-2020 in line with slowdown in economic activities.
In line with the predicted slowdown, loan disbursement policies in Q1-2020 are estimated to be stricter as indicated by the Standard Lending Index of 12.8%, higher than 10.6% in the previous quarter.
Stricter loan disbursement standards will mainly apply to investment, working capital, and MSME loans. Aspects that will be made stricter are loan tenor and administration requirements. (AM/MS)