Bad loans at state banks rise by $137m in two months<\/p>\n
JAKARTA (JP): Bad loans at the country's seven state banks
\nincreased by Rp 313 billion (US$137.7 million) within the April-
\nJune period of this year, Governor of Bank Indonesia J.
\nSoedradjad Djiwandono disclosed yesterday.<\/p>\n
Soedradjad said at a hearing with the Budget Commission of the
\nHouse of Representatives that bad loans at the state banks
\nincreased to Rp 7.316 trillion as of last June, from Rp 7.003
\ntrillion as of April.<\/p>\n
The seven state banks are Bank Bumi Daya, Bank Dagang Negara,
\nBank Ekspor Impor Indonesia, Bank Negara Indonesia, Bank
\nPembangunan Indonesia, Bank Rakyat Indonesia and Bank Tabungan
\nNegara.<\/p>\n
Soedradjad said bad loans at the state banks account for 73.4
\npercent of the total bad loans at all of the country's commercial
\nbanks, which as of June stood at Rp 9.97 trillion, or 4.16
\npercent of their outstanding credits, up from Rp 9.78 trillion,
\nor 4.24 percent of the outstanding credits as of April.<\/p>\n
He added that bad loans at provincial development banks
\nincreased to Rp 533 billion as of last June, from Rp 515 billion
\nas of April.<\/p>\n
Bad loans at domestic private commercial banks, however,
\ndecreased slightly to Rp 1.668 trillion as of last June from Rp
\n1.795 trillion as of April, while bad loans at foreign-owned and
\njoint-venture banks declined to Rp 454 billion from Rp 468
\nbillion.<\/p>\n
In dealing with bad loans, Soedradjad said Bank Indonesia, the
\ncentral bank, focuses on solving its current bad loans first.
\nAttention is then given to other banks suffering from bad loans
\nand the prevention of future bad loans. Guidelines are then
\nintroduced to formulate credit policies and standard internal
\naudits for commercial banks.<\/p>\n
\"I cannot yet report the results of our efforts to deal with
\nbad loans because the credit policy guidelines and internal audit
\npolicy we issued last March will come into effect in January next
\nyear,\" Soedradjad told the hearing.<\/p>\n
He said those efforts are expected to reduce the emergence of
\nnew bad loans. \"Our bad loans in the future will decline further
\nnot only because of the decrease in existing bad loans but also
\nfrom the avoidance of new bad loans.\"<\/p>\n
Despite the increase in bad loans, Soedradjad said problem and
\ndoubtful loans at all commercial banks had decreased accordingly.
\nProblem loans as of June fell to Rp 5.7 trillion, or 2.38 percent
\nof their outstanding credits, from Rp 5.95 trillion, or 2.58
\npercent of outstanding credits as of April.<\/p>\n
Doubtful loans at commercial banks as of June shrank to Rp
\n12.19 trillion, or 5.09 percent of outstanding credits, from Rp
\n12.51 trillion, or 5.41 percent of outstanding credits as of
\nApril.<\/p>\n
Meanwhile, the collectibility rate of loans provided by
\ncommercial banks increased to 88.37 percent of outstanding
\ncredits as of June, from 87.77 percent as of April. (rid)<\/p>",
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