JAKARTA, May 21 (Xinhua) -- Bank Indonesia has urged domestic banks to lower credit interest rates to accelerate loan distribution, Bank Indonesia Governor Perry Warjiyo said on Wednesday.
Perry said the average banking credit interest rate remained relatively high in April, standing at 9.19 percent, nearly unchanged from 9.20 percent in early January.
"Going forward, Bank Indonesia sees the need to lower bank interest rates to encourage credit expansion and support stronger economic growth," he said at a virtual press conference following the board of governors meeting.
Perry noted that credit growth slowed slightly in April, recording 8.88 percent year-on-year, compared to 9.16 percent in March.
On the supply side, he added that banks' appetite for lending remains strong, particularly in the agriculture, electricity, gas and water, and social services sectors.
He further said that liquidity conditions in the banking sector are generally sound, although the growth of third-party funds moderated from 5.51 percent year-on-year in January to 4.55 percent in April. This trend, he said, has increased competition for funding and highlighted the need to diversify funding sources. ■
