Bankers Anxious Over Drying Liquidity in High Interest Rate Era
Jakarta - The banking industry is facing the challenge of tight liquidity in an era of high benchmark interest rates. As is known, the BI-Rate, currently at 5.75%, has risen by 100 basis points throughout 2026.
Chairman of the Board of Commissioners of the Indonesia Deposit Insurance Corporation (LPS) Anggito Abimanyu said that bank funding costs are currently rising, as a result of the benchmark interest rate policy and policies related to government programmes. He even said that many banks are complaining about liquidity challenges.
“The cost of funds is now increasing, banks are complaining of a liquidity drought. This is due to policy adjustments that must be ensured in the medium term, especially regarding services for government programmes,” Anggito said in his speech at the National Seminar and Inauguration of ISEI Jakarta Commissariat at Perbanas Institute, Jakarta, Tuesday (28/7/2026).
He continued that bank net interest margins (NIM) are now under pressure. Furthermore, the growth of third-party funds (DPK) has slowed in recent months.
Data from Bank Indonesia (BI) recorded that DPK collection in June 2026 amounted to IDR 9,718.8 trillion, or grew 8.1% year-on-year (yoy), lower than the previous month’s growth of 10.8% yoy. Meanwhile, OJK data recorded that the banking NIM as of May reached 4.36%, down from 4.56% at the end of last year.
PT Bank Tabungan Negara (Persero) Tbk. (BBTN) is feeling the liquidity challenges. BTN’s Director of Consumer Banking, Hirwandi Gafar, said the bank continues to maintain liquidity, although he acknowledged the current situation is quite challenging.
“It is definitely felt. It is a challenge, that is part of the art of being bankers,” he said after the event.
Previously, at the presentation of BTN’s first semester 2026 performance, BTN President Director Nixon Napitupulu also spoke about liquidity challenges. He acknowledged there is competition for liquidity in the market, which has triggered banks to raise savings interest rates. Not to mention, the Association of State-Owned Banks (Himbara) had faced the challenge of withdrawing excess budget balances.
“That is what happened and eventually triggered banks to issue interest rates and it became a race to the top. We also requested coordination for bidding conducted through the Public Service Agency (BLU), so it is not pulled too high,” Nixon said during the performance presentation at Menara BTN 2, Thursday (16/7/2026).
He observed that currently, it is the small private banks that are setting high savings interest rates. “What is emerging now, if we look at it, are the small private banks, their bids are still high, that is what we are feeling. Hopefully, this will subside soon, and we can create liquidity easing,” he explained.
Separately, the Chairman of the National Banks Association (Perbanas), Hery Gunardi, said the profitability of the banking industry will be pressured if the central bank’s benchmark rate increases. He said the increase in the BI Rate will have an impact on rising deposit interest rates, but this depends on each bank’s funding structure.
“What rises are deposits that are sensitive to pricing,” Hery explained when met at Sentra BRI, Tuesday (21/7/2026).
According to the President Director of PT Bank Rakyat Indonesia (Persero) Tbk. (BBRI), in responding to this condition, banks cannot immediately raise lending rates. He said there is a transmission time for interest rates to affect lending rates.
Meanwhile, President Director of PT Bank Aladin Syariah Tbk. (BANK) Koko Tjatur Rachmadi confirmed the competition for liquidity. He therefore hopes the new BI Governor can ease this challenge.
“We see that liquidity in the market has been quite tight lately. So, with this change [of BI Governor], we certainly hope there will be adequate liquidity in the market,” he told CNBC Indonesia, Monday (27/7/2026).
Koko, who is the Secretary General of the Indonesian Sharia Bank Association (ASBISINDO), said the high BI rate will certainly increase financing costs and potentially lower its quality. “But for the sharia banking industry and for Aladin itself, it is still okay. However, we have indeed felt the tight liquidity in the last few weeks or months,” Koko concluded.
On the regional development bank (BPD) side, PT BPD Jawa Timur Tbk. (BJTM) or Bank Jatim acknowledged the tendency for rising deposit interest rates. Bank Jatim itself needs to adjust.
“However, thank God, so far our liquidity is still quite ample, although we realise that going forward it will be quite challenging,” said Winardi to CNBC Indonesia, Tuesday (28/7/2026).