JAKARTA. The bankers are advised to not massively allocate credits to commodity sector, despite the price of commodity has started increasing. As of the end of last year, the performance of banking sector had been shadowed by the significant number of non-performing loans, mainly from commodity sector. The latest data of OJK (Financial Service Authority or FSA), the NPL rate of mining and digging hit the level of 7.37% as of November 2016. This was the highest NPL rate among all sectors. This number has jumped from the level of 4.2% from the end of 2015. The NPL rate in mining sector in 2016 had exceeded the safe level set by the OJK maximum at the level of 5%. The number of NPLs in mining sector consist of Rp 9.40 trillion of the total allocated credit as much as Rp 127.5 trillion.
NPLs burden banks’ profits
JAKARTA. The bankers are advised to not massively allocate credits to commodity sector, despite the price of commodity has started increasing. As of the end of last year, the performance of banking sector had been shadowed by the significant number of non-performing loans, mainly from commodity sector. The latest data of OJK (Financial Service Authority or FSA), the NPL rate of mining and digging hit the level of 7.37% as of November 2016. This was the highest NPL rate among all sectors. This number has jumped from the level of 4.2% from the end of 2015. The NPL rate in mining sector in 2016 had exceeded the safe level set by the OJK maximum at the level of 5%. The number of NPLs in mining sector consist of Rp 9.40 trillion of the total allocated credit as much as Rp 127.5 trillion.