LPS Reports Rise in Deposits with Special Rates Following BI-Rate Hike

The Indonesia Deposit Insurance Corporation (LPS) has revealed that the proportion of deposits earning special interest rates, or rates above the deposit insurance rate threshold (TBP), has increased in response to the recent Bank Indonesia (BI) rate hike. LPS Board Commissioner Doddy Zulverdi stated that the portion of deposits with rates above the TBP rose to 33.82 per cent in May 2026, up from 32.92 per cent in April 2026. “This occurred across all banks. No bank was exempt from the increase in special rates,” Doddy said in a press conference in Jakarta on Thursday. He further explained that the increase was not solely an implication of the policy rate adjustment but also reflected prevailing financial market conditions and heightened competition among banks to gather third-party funds. Bank Indonesia raised the BI-Rate by 50 basis points in May 2026, marking the first adjustment since September 2025, followed by another 50 basis points cumulative increase in June. Despite the rising trend in market interest rates, the LPS maintained its TBP level in May 2026, which consequently led to a larger share of deposits exceeding the guaranteed rate threshold.