Daily Market Indonesia October 2022

 

Daily Market Indonesia October 2022

The Financial Services Authority (OJK) gave a signal to extend credit restructuring again next year, from the original plan ending on March 31, 2023. Director of Commercial Bank Regulations at the OJK Banking Research and Regulations Department, Indah Imardhini, said that credit restructuring would continue, but it would become more difficult. targeted.

According to Indah, restructuring next year will only be given to certain regions, debtor segments, and economic sectors. This policy is different from the current restructuring which applies to all sectors.

OJK considers that some sectors are still vulnerable due to the Covid-19 pandemic. Chairman of the OJK Board of Commissioners, Mahendra Siregar, said that the accommodation sector and the food and beverage sector still need an extension of credit restructuring. This step is necessary because these two sectors have a high proportion of restructuring loans.

 Key Takeaway

The reduced coverage of businesses that received credit restructuring indicates the trend of business recovery and the ability to pay debtors is getting better.

From the banking side, this policy has the potential to encourage the continuation of the upward trend in net income driven by the downward trend in provision expenses, which was already evident in 2Q22. This is mainly because banks have prepared a balance of Allowance for Impairment Losses (CKPN), while business trends have started to improve and debtors are paying off their loans.