Lending has been growing at around 22%+ over the last three years in Indonesia vis-a-vis around 13% growth in the deposits. This has led to an increase in the average Loan to Deposit ratio, which is a cause of worry for the banks in Indonesia. Lending growth is expected to result in an excellent year for the banks as can be seen from the 9 months results. BRI's nine-month earnings rose by 17 per cent in spite of marginal drop in the Net Interest Margin (NIM) from 8.43 to 8.25 per cent mainly due to the growth in lending (The Jakarta Globe).
However, as per Bank of Indonesia (BI) the lending growth is expected to slow down significantly in 2014 to 15.3 to 16.6 per cent on the back of slowing economy and recent hike in the interest rate (Reuters).
However, as per Bank of Indonesia (BI) the lending growth is expected to slow down significantly in 2014 to 15.3 to 16.6 per cent on the back of slowing economy and recent hike in the interest rate (Reuters).
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