The central bank (Bank Indonesia/B.I.) on Friday last week (June 21) decided to reduce the minimum statutory reserves (GWM) by 50 basis point, aiming for loosening the banking liquidity. B.I. expects to add banking liquidity by Rp25 trillion this year. The new policy will come into effect on July 1, 2019. The GWM ratio for conventional banks is set at 6% while Syariah banks at 4.5%. This policy will boost the credit or lending, also third-party funds.
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