Sumber : Infobank
NON performing loans are a nightmare for bank directors. Potential bank losses due to non performing loans can erode shareholder trust. Even at state-owned banks, non-performing loans can become a nightmare story when they are included in the article on state losses. Law enforcement officials are very “quick” in investigating the process of granting non-performing loans upon hearing about non performing loans at banks, regional development banks (BPD) and state-owned enterprises (BUMN). Non performing loans, proposed from below and decided collegially, can also become a disaster for bankers when they reach the legal way.
This is what happened after PT Sri Rejeki Isman Tbk (Sritex) collapsed due to its inability to settle its mounting debts. The Sritex curator team previously stated that Sritex’s total debt was 29.8 trillion IDR from 1,654 creditors, including 22 secured creditors, 349 preferred creditors, and 94 concurrent creditors. Of that figure, Sritex owed IDR 4.2 trillion to state-owned banks and regional development banks (BPD).
After the company was declared bankrupt at the end of December 2024 and officially closed all operations in early March 2025, this nightmare became a reality. As of last July, nine bankers from Bank Jabar Banten (BJB), Bank DKI, and Bank Jateng have been named suspects, three of whom were the company’s president directors. Meanwhile, Sritex’s Finance Director (2006–2023), Allan Moran Severino, and the company’s former President Director, Iwan Setiawan Lukminto, become the suspects. They are assumed of using the bank’s loan funds to pay Sritex’s debts and purchase non-productive assets such as land in Solo and Yogyakarta.
The Attorney General’s Office is still investigating the provision of loans to Sritex subsidiaries by state-owned banks such as Bank Negara Indonesia (BNI), Bank Rakyat Indonesia (BNI), and the Export-Import Financing Agency (LPEI). “We are still investigating the provision of loans to two banks: BNI, BRI, and LPEI. These loans are syndicated loans,” said Nurcahyo Jungkung Madyo, Director of Investigation at the Attorney General’s Office’s Special Crimes Investigation Agency, as quoted by The Asian Post (July 22, 2025).
However, the 24 private banks that also provided credit to Sritex have not faced any legal issues. Even if there are violations of the basic principles of providing credit facilities, private banks are not involved in state finances and only pose potential losses to the company. “If there is evidence of anomalies in the use of loan funds, at state-owned banks, it could become a legal issue, even though it is a business risk. That’s the problem with state owned banks, in the name of state losses. Meanwhile, our bank has been fully reserved, and we are awaiting the curatorship process,” a commissioner at a private bank told Infobank last month.
The dilemma for a banker, especially at a state-owned bank, is this: Even if there is no mens rea, or malicious intent to commit corruption and enrich oneself, when a business decision is made and the risks become a reality, they face prosecution and imprisonment. It will be increasingly difficult for regional development bankers to shake off the label of “local government cashiers” and choose the safe route by extending credit to local government employees. Why go to the trouble of building competence in the corporate market if the risks of their business decisions are later deemed criminal acts?
In fact, to achieve sustainable credit growth, banks must adopt the “bank follows the trade,” “market oriented,” “refocusing,” “creating the business,” and expanding their market diversification paradigm. For example, Citibank, facing stiff competition from local banks, refocused on the wholesale banking segment. Furthermore, BRI, facing declining liquidity and profitability indices in the micro, small, and medium sized enterprises (MSMEs), turned to the corporate segment to maintain its credit growth. Similarly, BTPN Syariah, facing stagnation in the ultra-micro market, its primary target, is attempting to expand into the large business segment this year.
The MSME segment remains under pressure. According to Bank Indonesia (BI) data, MSME loans grew only 2% annually as of June 2025, reaching IDR 1,404 trillion. This growth was driven by a 2.5% decline in micro loans to IDR 621.2 trillion, and a 1.6% contraction in medium loans to IDR 304.7 trillion. Meanwhile, small loans rose 10.5% to IDR 478.1 trillion.
Overall credit growth is heading into a slowdown. The slowdown continued from 8.1% in May 2025, then slowed to just 7.6% in June, reaching IDR 7,956.4 trillion. This growth was supported by corporate loans at 10.6% and retail loans at just 4.2%. In 2024, commercial bank credit growth remained at 10.39%.
According to Infobank Research Bureau in a study entitled Infobank Rating of 105 Commercial Banks 2025, there are at least three main challenges facing bankers in disbursing increasingly challenging credit.
The first is the ongoing uncertainty stemming from global geopolitical conditions, trade tariff policies, and Indonesia’s challenging domestic economic conditions. Macroeconomic instability in various parts of the world has depressed consumer purchasing power, reduced market demand, and made it difficult for businesses to maintain revenue and profitability. Due to the challenging market conditions, many large companies have seen declining revenues and mounting debts, forcing them to close down.
The second is the tight liquidity is rife as banks compete with Government Securities (SBN) issued by the government and Bank Indonesia Rupiah Securities (SRBI) issued by Bank Indonesia (BI). The more attractive yields encourage investors to purchase SBN or SRBI. Consequently, funds that would otherwise be held in banks are being diverted to government spending or public investment.
The tight liquidity certainly makes it difficult to lower lending rates. Moreover, banks themselves are often squeezed by large fund owners demanding high returns, such as pension funds, BPJS-TK (Social Security Agency for Employment), BPKH (Hajj Finance), and large corporations. Meanwhile, the net interest margin (NIM) must be maintained thick to cover risks and maintain profit margins due to shareholder demand and, of course, bonuses/tantiemes for management.
The third is the increasing credit risk. Amidst the economic downturn, some individuals or companies try to survive during difficult times, even if they have to profit by “preying” on others. In fact, the death trap of non performing loans can be deliberately created by unscrupulous debtors who default on payment obligations, use the credit to pay off debts or other activities, then protect themselves with other parties and commit criminal acts.
Banks must also navigate risks. The increasing risk of credit deterioration is evident in the rise in low-quality loans, reflected in the loan at risk (LAR). According to data from the Financial Services Authority (OJK), banking LAR increased from 8.90% in September 2024 to 9.72% in January 2025, then rose to 9.77% in February 2025, to 9.86% in March 2025, and to 9.93% in May 2025. Meanwhile, gross non-performing loans (NPLs) showed an upward trend, from 2.08% in December 2024 to 2.29% in May 2025.
NPLs themselves are like a thorn in the flesh for banks. If not resolved, the health of their portfolios will be compromised. The subsequent impact will decrease profitability and solvency, which can affect shareholder and depositor confidence. Experienced bankers generally understand the situation and are used to dealing with delinquent borrowers. However, bankers at regional development banks (BPD) and state-owned enterprises (SOEs) fear that non-performing loans, which should be classified as business risks, will be dragged into court for being considered state losses. This is despite the fact that bank capital is separated from state assets and includes public funds.
If credit continues to be considered a state loss, banks will seek safety by becoming “lazy banks,” a school of thought where banks prefer low-risk, government backed investments such as government bonds over lending to the risky private sector.
This situation has already occurred in national banking, with the increase in the proportion of securities and placements with Bank Indonesia (BI) to productive assets from 23.44% in 2019 to 29.20%. Meanwhile, the proportion of credit to productive assets has decreased from 59.99% to 56.23%. Meanwhile, the capital adequacy ratio (CAR) of commercial banks has strengthened, from 23.32% to 26.69%. This is far above the safe CAR requirement according to Basel III, which is at least 10.5%. A high CAR indicates a bank’s increased risk-absorbing capacity, enabling it to expand credit at a faster pace.
The phenomenon of “lazy banking” runs counter to current economic development conditions and needs. The credit-to-gross domestic product (GDP) ratio in Indonesia is only 40%, far below developed countries, which have surpassed 100%. The government wants to accelerate Indonesia’s economic growth to 8% to expand employment opportunities and reduce poverty. Encouraging bank credit is crucial so that the public and businesses can utilize it for various purposes, such as consumption, working capital, and investment.
If the government wants to encourage credit growth, it must create strong market demand and eliminate various business barriers, such as streamlined licensing, bureaucracy, taxation, law enforcement, and eradicating levies that disrupt business operations. What is equally important is to end the criminalization of non-performing loans as a source of state losses. All banks have non-performing loans. Non-performing loans are part of credit risk, unless there is collusion between debtors and creditors.
This is what happened after PT Sri Rejeki Isman Tbk (Sritex) collapsed due to its inability to settle its mounting debts. The Sritex curator team previously stated that Sritex’s total debt was 29.8 trillion IDR from 1,654 creditors, including 22 secured creditors, 349 preferred creditors, and 94 concurrent creditors. Of that figure, Sritex owed IDR 4.2 trillion to state-owned banks and regional development banks (BPD).
