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Standard Chartered Bank Raises Interest on Deposits

Jakarta -Standard Chartered Bank Indonesia has raised interest rates on deposits and lending rates gradually to certain customer segments.

Standard Chartered Bank Indonesia Chief Financial Officer Anwar Harsono said the interest rate adjustment was in response to the 7 Days Bank Rate (BI-7DDR) policy rate increase and guaranteed deposit rates which rose by 100 bps and 50 bps since May 2018 by raising deposit and lending rates of 25-50 bps.

“The adjustment is determined by liquidity conditions, risk appetite of banks, and market competition,” reported by Bisnis Indonesia on Wednesday (25/7).

Although the interest on deposit increased, he added, it will not change the composition of third party fund portfolio (DPK). The portion of low-cost funds still dominate by 70% of the total funds.

In general, the movement of deposit rates of commercial banks has experienced a downward trend since the last three years.

Based on the latest data published by the Financial Services Authority (OJK), as of May 2018, the rupiah deposit rate for all tenors has declined compared to the position at the end of 2017. Nevertheless, in line with the policy rate hike since May, the deposit interest rate is expected to start adjusting self.

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