Jakarta, 12 January 2022, CNBC Indonesia – The value of loans affected by restructuring continued to decline at a number of banks. Recently, PT Bank Negara Indonesia (Persero), Tbk (BBNI) noted that the company also experienced this decline until the end of 2021.
Based on the latest data released by BNI, the value of the company's credit restructuring due to the Covid-19 pandemic as of November 2021 was Rp 79.38 trillion. This value decreased by 22.47% compared to the position in December 2020 when BNI's credit restructuring reached Rp 102.39 trillion.
The decrease in the number of restructured loans was followed by a decrease in BNI's Loan at Risk (LaR) ratio during that period. BNI's LaR as of November 2021 was recorded at 25.18%, down from the position in December 2020, which was 28.74%.
Simply put, LaR is a term to refer to the risky credit ratio or financing that is monitored. The smaller the LaR value indicates the maintained quality of financing disbursed by the Bank. The decline in BNI's LaR until the end of 2021 is considered a positive indicator by the Senior Faculty of the Indonesian. Banking Development Institute (LPPI) Amin Nurdin. According to Amin, this decline could indicate the occurrence of three things.
"Regarding the decline in LaR, it is because there is a decrease in restructured loans. This means that there are improvements on both sides, namely banks and customers," Amin said, Tuesday (11/1/2022).
Amin said that the first indication that emerged from the decline in LaR was the potential for expansion that BNI could do to increase the distribution of quality credit. The second indication is that this decline has allowed banks to restrain the rate of CKPN which has an impact on profits. Third, BNI can send signals to the business world regarding the fulfillment of credit needs. This signal can attract business players who are now entering a recovery period after being affected by the pandemic since early 2020.
"In 2022 there is definitely the possibility of another decrease in LaR. Sectors that are starting to become drivers of growth (credit) are agriculture, fisheries, animal husbandry, plantations (palm), and pharmaceuticals. Even though the pandemic is decreasing, there will still be potential for growth in the pharmaceutical business," Amin continued. A similar opinion was conveyed by the Banking Observer Paul Sutaryono. He assessed that the decrease in LaR showed the smaller the risk of an increase in non-performing loans (NPL) in a Bank.
“The decrease in LaR is a sign that the risk of a Bank's NPL increase is getting smaller. This is a good start in improving credit quality in line with the decline in credit restructuring," said Paul. According to Paul, the decline in LaR and reduced NPL risk provides an opportunity for banks to expand credit. However, he said, this expansion must be carried out by banks carefully.
“From the other side, this is an opportunity for banks to expand credit. Of course, credit expansion must be accompanied by strict risk management implementation," he said.
Responding to the improvement in credit risk, BNI’s Corporate Secretary, Mucharom said the decline in restructuring occurred linearly in both the micro, small and medium enterprises (MSMEs) and corporate segments.
“This has helped move the economy and has given restructuring debtors optimism about continuing their expansion plans. Loan at risk (LAR) also shows a similar trend, which makes BNI more confident for a higher quality expansion next year," he said.
Several strategic steps were taken by BNI to improve the quality of restructured loans, such as improving risk management and initiatives. First, improving the end-to-end credit process for both the business banking segment and the consumer segment, including pipeline management, underwriting process and monitoring.
In addition, Mucharom continued, BNI also continues to monitor and evaluate LaR periodically. Not to forget, the company conducts credit monitoring in a disciplined manner through a debtor watchlist or LAR review which is carried out periodically.