cautious-banks-threaten-indonesias-recovery

Cautious banks threaten IndonesiaÆs recovery

Despite boasting healthy ratios, Indonesia's banks are doing too little to boost the economy.

Indonesia's main banks are in good shape, but are frustrating a supportive government's plans to stimulate the economy by adopting less than generous lending regimes.

Bank Indonesia, the central bank, has cut its benchmark interest rate by three percentage points since the start of the year to a record low of 6.5% in August, yet domestic banks have reduced their lending rates by less than a quarter of a percentage point and cut deposit rates by just over 1.75 percentage points.

They have been earning net interest margins of around 6%, one of the highest in Asia, but lending by the top commercial banks rose by only 1.1% to Rp1,378 trillion...

¬ Haymarket Media Limited. All rights reserved.

FinanceAsia has updated its subscription model.

Registered readers now have the opportunity to read 5 articles from our award-winning website for free.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences.

To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222

Article limit is reached.

Hello! You have used up all of your free articles on FinanceAsia.

To obtain unlimited access to our award-winning exclusive news and analysis, we offer subscription packages, including single user, team (2-10 users), or office-wide licences. To help you and your colleagues access our proprietary content, please contact us at subscriptions@financeasia.com, or +(852) 2122 5222