"It will be slower in the second semester. Interest rates will increase. There will be loan to value (LTV). All banks will be taking the same (policy)," Finance Director of PT Bank Danamon Vera Eve Lim said.
Jakarta (ANTARA News) - The growth of ownership-housing scheme credit (KPR) in the second semester of this year is expected to be slower than the first semester due to a number of factors, a bank executive said.

"It will be slower in the second semester. Interest rates will increase. There will be loan to value (LTV). All banks will be taking the same (policy)," Finance Director of PT Bank Danamon Vera Eve Lim said here on Tuesday.

She said that Danamon`s housing credits still accounted for three percent of the total credits. It was smaller than motorbike credits which accounted for 25 percent which had become Danamon`s mainstay credit provision.

"The amount of our KPR credit extension is small, accounting for about three percent only. We have provided a big amount of credit for motorbike credit scheme, housing scheme," she said.

Vera said that the growth of Danamon`s housing scheme credit in June was relatively good, about 30 percent compared with that in the same month in the previous year.

On the policy to tighten the LTV that will be issued by Bank Indonesia (BI/the central bank), Vera said that she supported the policy to maintain the sustainable growth of banks.

"Overgrowing credit is not good. I think, willing or unwilling, the regulator (BI) must intervene in the form of issuing a policy, so that this sector would not obtain banks` negative list," she said.

She said that banks basically wanted their growth to be sustainable.

Vera said that threat of increasing inflation as a result of subsidized fuel oil price hikes needed to be responded to so that it prevent customers from failing to pay credits.

However, she said, the small portion of KPR credit which was only about three percent, the policy would not have too much effect on Danamon`s credit growth.

In the meantime, PT Bank Mestika Dharma (BBMD) is optimistic its credit growth would meet the target despite recent central bank`s statement that economy would slowdown to 5.8 to 6.2 percent.

"Our credit distribution has reached Rp5.4 trillion until June," the bank`s president director, Achmad S Kartasasmita, said after the company`s public listing at the Indonesia Stock Exchange on Monday.

He said the bank has set a target of distributing credits up to Rp6.2 trillion this year which is up 21.5 percent from the previous year.

In the first semester this year its corporate credits grew 13 percent compared to the same period last year.

He admitted the bank would focus on distributing credits to micro-, small and medium businesses (UKM). Around 30 percent of the bank`s credits would be channeled to UKM businesses while the rest to retail and consumer businesses and corporations, he added.

Indonesia`s central bank has revised the country`s economic growth target down from 5.9 to 6.3 percent by the end of the year to to 5.8 to 6.2 percent.

The bank`s governor, Agus Martowardojo, said the country`s economic growth is expected to be lower than initially expected.

"Based on Bank Indonesia`s studies economy would grow only 5.8 to 6.2 percent this year," he said.

He said the trend could be seen from the the decline in investment contribution to only 6.3 to 6.7 percent from 9.8 percent last year.(*)

Editor: Heru Purwanto
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