Although the NPL ratio rose from 2.9 percent at the end of last year, the quality of banking loans until February 2017 remained under control, the OJK executive chief for banking supervision Nelson Tampubolon said in a press briefing here on Wednesday.
Moreover, the net NPL ratio as of February 2017 reached 1.32 percent, well below 5 percent set by the OJK, he said.
Gross NPL ratio is the ratio of non-performing loans to total loans before being reduced by allowance for non-productive assets. Net NPL ratio is the ratio of non-performing loans to total loans after being reduced by allowance for non-productive assets.
In general, the Indonesian banking industry is fairly sound although banks intermediation function marked by the distribution of credits has not grown above 9.9 percent or two digits, he said.
"But it is higher now than in February 2017. It will reach two digits in the second semester," he said.
He said third party fund placement in the banking industry grew 9.2 percent as of February 2017. The third party fund placement will continue to grow, fueled by repatriation fund from the tax amnesty program during March 2017.(*)
Editor: Heru Purwanto
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