OJK: Indonesian Banks Stay Strong Despite Negative Outlook

March 25, 2026 | 11:51 am

TEMPO.CO, Jakarta - The Head of the Executive Board of Banking Supervision at the Financial Services Authority (OJK), Dian Ediana Rae, stated that the performance of the banking industry remains solid despite international rating agencies such as Moody's and Fitch Ratings revising the outlooks of major Indonesian banks to negative. Dian claimed that the revision was not due to fundamental factors in the banking performance.

"The revision of the outlook for major Indonesian banks is more triggered by the change in Indonesia's sovereign credit outlook from stable to negative, which also affects the risk perception towards the national banking sector and the influence of external factors in the global macroeconomic dynamics," said Dian in a press release on Wednesday, March 25, 2026. In general, the ratings of institutions or companies in a country are equal to or lower than the sovereign rating in that country.

Dian mentioned that the national banking industry is in a positive condition, with a credit growth of 9.96 percent year on year in January 2026. The credit growth of the Core Capital Group Banks (KBMI) 4 and State-Owned Banks Association (Himbara) recorded double-digit growth, at 13.34 percent and 13.43 percent, respectively. Meanwhile, Third Party Funds (DPK) grew by 13.48 percent year-on-year. The DPK growth for KBMI 4 and Himbara was 16.32 percent and 16.38 percent, respectively.

In terms of asset quality, Dian stated that the Gross Non-Performing Loan (NPL) ratio is in the range of less than 1 percent to 3 percent. She also said that the Loan at Risk (LaR) remains under control and is supported by adequate reserve formation. According to Dian, this reflects the implementation of governance and risk management, especially in maintaining the quality of credit distribution.

The OJK sees the adjustment of the outlook as temporary and potentially subject to change as the prospects of the global and domestic economy improve. "With these developments, the credit rating outlook in the future has the opportunity to return to a stable or positive position," said Dian.

Moody's previously downgraded the outlook or projections of five major banks in Indonesia from stable to negative. These five banks are Bank Mandiri, Bank Rakyat Indonesia (BRI), Bank Negara Indonesia (BNI), Bank Central Asia (BCA), and Bank Tabungan Negara (BTN).

This downgrade is in line with the lowering of Indonesia's credit rating outlook to Baa2 level, which was previously stable, becoming negative. "This rating change primarily reflects the negative prospects for Indonesia's Baa2 credit rating, which reflects increasing risks to Indonesia's policy credibility, as evidenced by diminished predictability and coherence in the policy-making process, alongside ineffective policy communication over the past year," Moody's wrote in its announcement, quoted on Sunday, February 8, 2026.

Read: Geopolitical Tensions Raise RIsks for Insurance Industry, OJK Says

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