Indonesian private banks prioritize credit quality amid economic uncertainty

Amid global economic uncertainty and tight liquidity, Indonesian private banks are adopting a more cautious business strategy for the second half of 2026. The focus has shifted from maximizing credit growth to safeguarding asset quality, tightening lending practices, and strengthening liquidity and capital.

This trend is evident in the first-half 2026 performance reports of several private banks. While some still recorded credit growth, expansion is more selective, emphasizing portfolio quality and risk management. PaninBank, for instance, experienced a contraction in credit growth, with its loans decreasing by 3.75 percent to Rp 139.64 trillion compared to the same period last year. This aligns with the bank's policy of being more selective in choosing business sectors, debtors, and financing purposes to protect its credit portfolio amid global economic uncertainty.

PT Bank Neo Commerce Tbk (BNC) is employing a similar strategy, reducing credit disbursement in the commercial and corporate segments while increasing financing for consumers and SMEs by 6.68 percent to Rp 5.8 trillion. BNC's President Director, Eri Budiono, stated that the bank prioritizes growth quality over mere expansion, believing a strong foundation is key to sustainable growth. He noted that the first-half 2026 results demonstrate the positive impact of their strategy focusing on growth quality, operational efficiency, and disciplined risk management.

Permata Bank reported a 5.3 percent credit growth, reaching Rp 171.2 trillion. Despite this growth, the bank maintained a cautious approach, reflected in its non-performing loan (NPL) ratio remaining at 2.1 percent and an improved loan at risk (LAR) ratio of 5.9 percent. Permata Bank's President Director, Meliza M. Rusli, highlighted that this performance demonstrates the bank's ability to maintain growth amidst economic changes and reflects customer confidence and adaptability.

OCBC also saw credit growth of 11 percent to Rp 185.3 trillion, supported by an 11 percent growth in third-party funds. The bank maintained asset quality with an NPL ratio of 1.9 percent and a reduced LAR ratio of 4.8 percent. OCBC President Director Parwati Surjaudaja affirmed the bank's commitment to maintaining healthy growth.