NPL makes Bank Lowering Target Credit

Credit growth is still needed to promote national economic growth. Chief Executive Banking Supervisors Financial Services Authority (FSA), Nelson Tampubolon urged banks to remain cautious in lending. But he also warned banks not to be afraid to extend credit. "There are some banks that said chances are they will look back and they may revise, and that I think is fine. Just before I say no revision because of fear so, but the element of prudence necessary, "Nelson said in Jakarta, Wednesday, June 10, 2015. According to him, there are some banks are already discussing plans yes revised targets this year, is generally a Regional Development Bank (BPD).

"Maybe because they are cautious because the most easily exposed to the NPL in banking history is BPD," he added.

Separately, one of the BPD who intend to revise the target is, Regional Development Bank DKI Jakarta (DKI Bank). If the previous Company targets 22% loan growth this year, this time according the latest economic developments, the Company estimates that the growth is only in the range of 15-16% only.

"Our target before the 22%, but in development, yesterday the bank is only about 10% on average yes, I do not see the possibility to maintain the level of 22%, because the project has not been realized, so we adjust," said Director of Bank DKI Eko Budiwiyono in Jakarta, Monday, June 8, 2015.

This year, the Company also is targeting a decrease in non-performing loan (NPL) be in the range of 2% until the end of the year. As is known, Bank DKI in the first quarter of this year recorded a decline in credit quality, with NPL gross 4.81% higher than the same period last year which recorded 2.65%. While nett, Bank DKI NPL in the first quarter of 2015 recorded 3%, increased when compared to the same period in 2014 which recorded 1.58%.

To suppress the NPL, Director of Bank DKI, Eko Budiwiyono said the Company has formed a special task force (task force) to perform the handling of NPL with various actions such as restructuring, reconditioning, execution and so on. While on the other hand, the Company will expand credit, especially for Micro Small and Medium Enterprises, consumer, and infrastructure loans guaranteed by the Government.

"In essence, if the decline in the two directions that we do, we must resolve the existing NPLs and to expand, because the two is the denominator and the numerator," Eko said recently in Jakarta.