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Credit Crunch in Indonesia in the Aftermath of Crisis

Credit Crunch in Indonesia in the Aftermath of Crisis

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Published by njprastowo
This study investigates whether the sharp decline in credit from banking sector in
Indonesia has been a result from a ‘credit crunch’ or due to weak credit demand
accompanying the recession. Using the macro and micro (panel data) analyses as well as
surveys on banks and non-financial firms, the study confirms the existence of a credit
crunch in Indonesia.
This study investigates whether the sharp decline in credit from banking sector in
Indonesia has been a result from a ‘credit crunch’ or due to weak credit demand
accompanying the recession. Using the macro and micro (panel data) analyses as well as
surveys on banks and non-financial firms, the study confirms the existence of a credit
crunch in Indonesia.

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Published by: njprastowo on Jan 20, 2009
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10/16/2011

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Credit Crunch
 
In IndonesiaIn the Aftermath of the Crisis
Facts, Causes and Policy Implications
Directorate of Economic Research and Monetary PolicyBank Indonesia
Juda Agung • Bambang Kusmiarso • Bambang Pramono •Erwin G. Hutapea • Andry Prasmuko • Nugroho Joko Prastowo
 
This study investigates whether the sharp decline in credit from banking sector inIndonesia has been a result from a ‘credit crunch’ or due to weak credit demandaccompanying the recession. Using the macro and micro (panel data) analyses as well assurveys on banks and non-financial firms, the study confirms the existence of a creditcrunch in Indonesia. Furthermore, we reveal that the banks’ source of firms’ fundshave decreased dramatically, from around 40% to around 25%. This study providespolicy implications for both monetary and financial policies of Indonesia and in generalof Asian countries.
 
Corespondence Address :
Financial Market Structure and Development Studies DivisionDirectorate Economic Research and Monetary Policy
Bank Indonesia
Jl. M.H. Thamrin No.2, Tower B, 19th floor, Jakarta 10010 IndonesiaPhone:62 21 381 773362 21 381 8624Fax.:62 21 231 0553E-mail:juda@bi.go.id
ISBN 979-96680-0-X

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