Warning Flag Unfolds over Bad Debts

By Editorial Team 03/10/2019
Summary

A warning flag unfolds over bad debts in the banking sector. Referring to the Kontan.co.id report, the latest data from Financial Services Authority (OJK) shows the gross non-performing loan (NPL) ratio of banks rose to 2.60 percent in August 2019 from 2.55 percent in July 2019. Moreover, several cases of bad loans from corporations had surfaced.

For example, Duniatex Group owed debts totaling Rp 18.61 trillion from 24 bilateral bank loans, three syndicated loans, and bond debt. Legal action had been filed against the textile company's bad loans. In another case, PT Krakatau Steel Tbk (KRAS) signed a debt restructuring agreement with its creditors on Monday (9/39). It has a consolidated debt totaling US$ 2.07 billion as of June 2019.

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