LTV relaxation can increase building credits

KONTAN.CO.ID – JAKARTA. The Residential Mortgage Segment (KPR) is not the only lever of credit. Bank Indonesia (BI) is currently easing up value loan (LTV) will also encourage other home loans, including construction loans.

The fall in the purchasing power of home loans has resulted in the construction sector. The proof, the trend of credit to construction continues to decline. Construction loans increased 13.49% in May 2018, down 16.6% in April and 18.1% in March.

The purpose of the credit application for this segment of construction is to significantly reduce the NPL NPL ratio . Construction credit risks are up relative to other segments.

According to BI data, non-performing loans on construction loans reached 6.43% in May 2018. This is higher than mortgage loans of 2.87% and unsecured real estate loans of 2%. 19% in the same month.

Oni Febrianto, commercial director of the State Savings Bank BTN, explains that, theoretically, the easing of the LTV will encourage demand for mortgage loans. Certainly, in the medium and long term will encourage the demand for building credits, especially in the housing sector.

Not only mortgages, BTN has also contributed to building credits. In May 2018, construction loans increased 17%. At least, this credit will grow to double digits or 23% until the end of this year. Currently, construction credit accounts for between 12% and 14% of BTN's total loans. Meanwhile, loans reached 189.68 billion rupiahs in May 2018.

Unfortunately, the construction sector still has a high GNP. "The construction of the NPL has dropped but it remains high for the size of the industry," he told KONTAN on Tuesday (3/7). BTN expects this easing of the LTV to encourage home loans. At least the rules will be felt three months after the rules.

According to Anggoro Eko Cahyo, BNI Bank's CFO softening LTV indirectly lifted growth in construction credit. Banks with the figure of 46 digits of registered construction loans have made good progress in other words above the market. Up to the end of May 2018 yesterday, the construction loan disbursement reached Rp 25.8 trillion or increased by more than 17%.

BNI Bank is also able to reduce the credit risk of construction. In May 2018, the state-owned bank recorded a rate of unproductive claims of 1.1%. The achievement decreased compared to the same period last year, rising to 1.9%.

BANK OF CREDIT