<\/p>\n
Indonesia\u2019s state-owned banks face rising credit and earnings risks after government-driven lending pushed loan growth to more than twice the industry pace, according to S&P Global Ratings.<\/p>\n
The surge in lower-yielding loans coincides with higher funding costs, and S&P expects net interest margins at state-owned banks to fall 10 to 20 basis points over the next 12 to 18 months, analysts led by Nikita Anand wrote in a report.<\/p>\n
The warning comes amid sovereign wealth fund Danantara\u2019s efforts to repair financially stretched state companies while pushing President Prabowo Subianto\u2019s ambitious spending agenda. Debt accumulated by some state-owned enterprises has already forced restructurings, raising questions over how much funding will be needed to clean up the sector and whether that could divert resources from new investments.<\/p>\n
Loans at the three state banks rated by S&P \u2014 PT Bank Mandiri, PT Bank Rakyat Indonesia and PT Bank Negara Indonesia \u2014 surged 26% on average from a year earlier as of June, more than double the industry\u2019s 12% pace. The growth, driven largely by lending to SOEs and government programs, has exceeded S&P\u2019s forecasts and the banks\u2019 own guidance, the rating company said.<\/p>\n
A test of the asset quality of SOE loans will come later this month, when PT Agrinas Pangan Nusantara, a Danantara-controlled firm overseeing Prabowo\u2019s village cooperative program, is due to make its first repayment, S&P said. Loans to Agrinas account for about 2% to 6% of total lending at each of Bank Mandiri, Bank Rakyat and and Bank Negara, it said.<\/p>\n
\u201cWhile the loans are not guaranteed, the banks can claim any shortfalls from the government,\u201d S&P analysts said, adding that the efficiency of that mechanism has yet to be tested. \u201cGiven the large ticket size of SOE loans, a default could lead to a spike in credit costs and a decline in earnings and capitalisation.\u201d<\/p>\n
Loan growth at state lenders could slow to 8% to 10% over the next year as liquidity tightens and banks repay short-term debt, S&P said. A healthy capitalisation, with a tier 1 capital ratio of 16% to 20% provides a buffer to the state-controlled banks, it said.<\/p>\n
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Indonesia\u2019s state-owned banks face rising credit and earnings risks after government-driven lending pushed loan growth to more than twice the industry pace, according to S&P Global Ratings. The surge in lower-yielding loans coincides with higher funding costs, and S&P expects net interest margins at state-owned banks to fall 10 to 20 basis points over the…<\/p>\n","protected":false},"author":1,"featured_media":6834,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-6833","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-bez-rubriki"],"featured_image_src":{"landsacpe":["https:\/\/relinvestmentsgroup.com\/wp-content\/uploads\/2026\/09\/Indonesia-6-800x445.jpg",800,445,true],"list":["https:\/\/relinvestmentsgroup.com\/wp-content\/uploads\/2026\/09\/Indonesia-6-463x348.jpg",463,348,true],"medium":["https:\/\/relinvestmentsgroup.com\/wp-content\/uploads\/2026\/09\/Indonesia-6-300x200.jpg",300,200,true],"full":["https:\/\/relinvestmentsgroup.com\/wp-content\/uploads\/2026\/09\/Indonesia-6.jpg",800,533,false]},"_links":{"self":[{"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/posts\/6833","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/comments?post=6833"}],"version-history":[{"count":1,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/posts\/6833\/revisions"}],"predecessor-version":[{"id":6835,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/posts\/6833\/revisions\/6835"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/media\/6834"}],"wp:attachment":[{"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/media?parent=6833"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/categories?post=6833"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/tags?post=6833"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}