Finance Minister Purbaya adds Rp100 trillion SAL fund placement to banking sector

Jakarta (ANTARA) - Indonesian Finance Minister Purbaya Yudhi Sadewa stated that the government is once again adding a placement of Surplus Budget Balance (SAL) funds amounting to Rp100 trillion to the banking sector. With this addition, the total SAL funds placed in banking now reach approximately Rp300 trillion. “A week before Eid, I added another Rp100 trillion, injecting it into the economic system. We are seriously safeguarding liquidity in the financial system,” said Purbaya in Jakarta on Wednesday. The additional funds are being channelled ahead of Eid to ensure liquidity remains stable amid potential increases in funding needs. This step is taken in response to market dynamics, particularly the rise in bond yields, which indicates liquidity pressure in the banking sector. According to Purbaya, the government is actively monitoring yield movements to assess liquidity conditions. A sharp rise in yields serves as a signal of fund shortages in the banking system. “If the bond yield rises by 0.1 percent, I already take notice. If it rises by 0.4 percent, there is definitely a drought, a liquidity shortage in the banks. I check, oh yes, the banks are short (on liquidity). I add more by injecting into the system,” he said. He explained that placing funds in banks can also impact the bond market, particularly in curbing yield increases. “Bank DKI alone received Rp2 trillion, if I’m not mistaken,” stated the Finance Minister. Meanwhile, for private banks, he indicated that they are not yet a priority in the initial stage. As is known, the government had previously placed around Rp200 trillion in funds. With this latest addition, the total liquidity intervention through government fund placements has grown significantly to Rp300 trillion. Purbaya emphasised that the fund placements are carried out flexibly and form part of the state cash management strategy. This approach also aims to prevent yields from rising too sharply. With the added liquidity, banks are expected to have room to purchase bonds, thereby easing pressure in the market.