New Credit Demand are Slowing

Slowing credit sourced from consumer lending and working capital loans. Bank Indonesia (BI) said demand for new loans first quarter of 2015 slowed compared to the previous quarter. Based on a survey of BI banking, impaired Weighted Net Balance (WNB) in the first quarter of 2015 to 13.7% from the previous quarter to 84%.

Director of the Department of Communications Bank, Peter Jacobs said the funding request is still quite low at the beginning of the year as well as new lending policies are more selective to suppress an increased risk of non-performing loans (non-performing loans / NPL) to cause the slowing demand for new loans.

Based on the type of use, slowing credit growth due to lower growth in consumer loans and working capital loans. Consumer credit slowed because multipurpose loans and vehicle loans decreased. The decline in vehicle loans affected by a decline in sales of cars and motorcycles in the first quarter of 2015.

In January and February car sales fell 0.3% from the previous quarter. meanwhile, motorcycle sales fell 11.1% compared to the previous quarter quarter.

"Based on the economic sector, the decline in demand for new loans occurred in 6 sectors of the economy," said Peter.

The largest decrease occurred in the mining and quarrying sector followed by social services sector, social, cultural, entertainment and other individuals. The decline in global demand, the decline in prices of mining products in the international markets as well as government policy regarding the export ban on raw minerals into the main factor that causes the respondent restrict new lending in the mining and quarrying sector.

Banking survey conducted by the Bank of Indonesia involving the sample of 42 commercial banks headquartered in Jakarta, with a share of around 80% credit of the value of total loans of commercial banks nationwide.