Cempaka Business and Economy: BI rate cuts make no impact on growth in bank lending: Report

"A Summary" – Apr 2, 2011 (Kryon channelled by Lee Carroll) (Subjects: Religion, Shift of Human Consciousness, 2012, Intelligent/Benevolent Design, EU, South America, 5 Currencies, Water Cycle (Heat up, Mini Ice Ace, Oceans, Fish, Earthquakes ..), Middle East, Internet, Israel, Dictators, Palestine, US, Japan (Quake/Tsunami Disasters , People, Society ...), Nuclear Power Revealed, Hydro Power, Geothermal Power, Moon, Financial Institutes (Recession, Realign integrity values ..) , China, North Korea, Global Unity,..... etc.) - (Text version)

"The Timing of the Great Shift" – Mar 21, 2009 (Kryon channelled by Lee Carroll) - (Text version)

“ … Here is another one. A change in what Human nature will allow for government. "Careful, Kryon, don't talk about politics. You'll get in trouble." I won't get in trouble. I'm going to tell you to watch for leadership that cares about you. "You mean politics is going to change?" It already has. It's beginning. Watch for it. You're going to see a total phase-out of old energy dictatorships eventually. The potential is that you're going to see that before 2013.
They're going to fall over, you know, because the energy of the population will not sustain an old energy leader ..."

"Update on Current Events" – Jul 23, 2011 (Kryon channelled by Lee Carroll) - (Subjects: The Humanization of God, Gaia, Shift of Human Consciousness, 2012, Benevolent Design, Financial Institutes (Recession, System to Change ...), Water Cycle (Heat up, Mini Ice Ace, Oceans, Fish, Earthquakes ..), Nuclear Power Revealed, Geothermal Power, Hydro Power, Drinking Water from Seawater, No need for Oil as Much, Middle East in Peace, Persia/Iran Uprising, Muhammad, Israel, DNA, Two Dictators to fall soon, Africa, China, (Old) Souls, Species to go, Whales to Humans, Global Unity,..... etc.)

"The Recalibration of Awareness – Apr 20/21, 2012 (Kryon channeled by Lee Carroll) (Subjects: Old Energy, Recalibration Lectures, God / Creator, Religions/Spiritual systems (Catholic Church, Priests/Nun’s, Worship, John Paul Pope, Women in the Church otherwise church will go, Current Pope won’t do it), Middle East, Jews, Governments will change (Internet, Media, Democracies, Dictators, North Korea, Nations voted at once), Integrity (Businesses, Tobacco Companies, Bankers/ Financial Institutes, Pharmaceutical company to collapse), Illuminati (Started in Greece, with Shipping, Financial markets, Stock markets, Pharmaceutical money (fund to build Africa, to develop)), Shift of Human Consciousness, (Old) Souls, Women, Masters to/already come back, Global Unity.... etc.) - (Text version)

“… The Shift in Human Nature

You're starting to see integrity change. Awareness recalibrates integrity, and the Human Being who would sit there and take advantage of another Human Being in an old energy would never do it in a new energy. The reason? It will become intuitive, so this is a shift in Human Nature as well, for in the past you have assumed that people take advantage of people first and integrity comes later. That's just ordinary Human nature.

In the past, Human nature expressed within governments worked like this: If you were stronger than the other one, you simply conquered them. If you were strong, it was an invitation to conquer. If you were weak, it was an invitation to be conquered. No one even thought about it. It was the way of things. The bigger you could have your armies, the better they would do when you sent them out to conquer. That's not how you think today. Did you notice?

Any country that thinks this way today will not survive, for humanity has discovered that the world goes far better by putting things together instead of tearing them apart. The new energy puts the weak and strong together in ways that make sense and that have integrity. Take a look at what happened to some of the businesses in this great land (USA). Up to 30 years ago, when you started realizing some of them didn't have integrity, you eliminated them. What happened to the tobacco companies when you realized they were knowingly addicting your children? Today, they still sell their products to less-aware countries, but that will also change.

What did you do a few years ago when you realized that your bankers were actually selling you homes that they knew you couldn't pay for later? They were walking away, smiling greedily, not thinking about the heartbreak that was to follow when a life's dream would be lost. Dear American, you are in a recession. However, this is like when you prune a tree and cut back the branches. When the tree grows back, you've got control and the branches will grow bigger and stronger than they were before, without the greed factor. Then, if you don't like the way it grows back, you'll prune it again! I tell you this because awareness is now in control of big money. It's right before your eyes, what you're doing. But fear often rules. …”

Monday, April 06, 2009

BI rate cuts make no impact on growth in bank lending: Report

The Jakarta Post, JAKARTA | Mon, 04/06/2009 9:29 AM

Taking too long: Customers queue Saturday at an ATM in a mall in South Jakarta. Despite sharp cuts in Bank Indonesia’s key interest rate since December, growth in bank lending remains slow. With the BI rate at 7.5 percent, interest rates for bank lending remain high at 12 to 16 percent, discouraging companies and individual consumers alike from borrowing, thus doing little to get the wheels of the economy moving any faster. JP/P. J. Leo

Despite sharp cuts in the central bank’s key interest rates since December, growth in bank loans remains slow as the sector grapples with rising bad loans and — for small and medium lenders — tight liquidity.

Bank Indonesia has since December slashed its benchmark interest rate by 200 basis points, the latest cut being last Friday, to help bolster domestic demand and stimulate economic growth slowed by a drop in exports amid a global economic meltdown.

However, while the BI rate now stands at 7.5 percent, interest rates for bank lending remain fairly high at around 12 to 16 percent, discouraging companies and individual consumers alike from borrowing, thus doing little to get the wheels of the economy moving any faster.

Businesses also claim that banks have been applying stricter and tighter requirements in handing out loans.

Bank Mandiri, the country’s largest lender by assets, says such a trend may have a lot to do with the banking sector’s cautiousness in giving out loans amid a rising trend in nonperforming loans (NPLs), and also a lack of liquidity in small and medium banks.

“Smaller banks will keep their interest rates high because they are worried their clients will transfer their savings and deposits to larger banks, which would then hurt their liquidity even more,” Mandiri president director Agus Martowardoyo said Friday at a gathering.

“Banks also have to face other problems in lowering interest rates, such as the high cost of funding, capital, risk, management and competition.”

According to BI data, there was no significant amount of increase in loans from commercial banks since the first BI rate cut last December.

The report shows that bank loans for investment only increased by 1.3 percent to Rp 259.3 trillion in January from Rp 255.9 trillion from the previous month, while lending for consumption barely rose to Rp 367.2 trillion in January from Rp 367.1 trillion in December.

Lending for working capital even decreased to Rp 663.4 trillion in January from Rp 684.7 trillion in December.

A growing trend in NPLs may also have contributed to the trend.

The BI report shows that NPLs have been on the rise since December.

The percentage of loans that are NPLs increased to 4.2 percent in January from 3.8 percent in December. Last Friday, BI Governor Boediono said that in February, national banks’ gross NPL rate rose by another 0.1 percent to 4.3 percent.

The report says that NPLs increased by 10.5 percent on average in three major segments — working capital, investment and consumption — ever since the first BI rate cut in December.

By function, the NPLs dedicated for the working capital segment rose 10.5 percent in January from the previous month; for the investment segment they increased 13.5 percent, and for the consumption segment they rose 7.7 percent.

Aviliani, an economist from the Indonesian Development of Economics and Finance (INDEF), shared the same opinion with Agus that scarcity in liquidity as well as rising NPLs had slowed down growth in bank lending.

“The first factor is from the funding side: large corporate banks have no problem giving out loans, but smaller and mid-size banks are currently facing a liquidity problem that prevent them providing loans,” she said Saturday.

“Second, smaller banks set high annual deposit rates of between 12 and 14 percent in order to gather cash from the public to increase liquidity. With such a high percentage on the deposit rates, no wonder they choose to set around credit rates of around 16 to 17 percent.” (hdt/fmb)

Credit of Commercial Banks Based on Type of Use (In Bilion Rp)

Types of Use October 2008 November 2008 December 2008 January 2009

Working Capital 687,229 705,366 684,672 663,357
Investment 250,188 255,984 255,900 259,317
Consumption 360,443 363,973 367,117 367,165
Total 1.297,860 1.325,323 1,307,688 1,289,839

Non Performing Loan of Commercial Banks Based on Type of Use (In Billion Rp)

Types of Use October 2008 November 2008 December 2008 January 2009

Working Capital 22,250 24,637 22,953 25,361
Investment 11,403 11,807 9,607 10,904
Consumption 9,669 9,750 9,313 10,030
Total 43,322 46,194 41,873 46,295

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Monday, April 06, 2009

BI rate cuts make no impact on growth in bank lending: Report

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