Indonesia’s banking sector liquidity is projected to strengthen through 2026, easing funding pressures and helping curb further margin squeeze, according to Nomura Securities Malaysia Sdn Bhd.
The system has experienced firmer deposit growth alongside continued expansion in money supply (M2), which rose 10.6% year-on-year (YoY) in December 2025, reducing earlier liquidity tightness.
Above-expected fiscal spending to support growth, higher fund placements by the Ministry of Finance, and dividend flows channelled by Danantara into state-owned enterprise (SOE) banks have bolstered deposit and money supply growth.
System-wide deposits climbed 16% YoY, while loan growth remained solid at 13% YoY.
Among SOE lenders — Bank Negara Indonesia (BNI), Bank Mandiri, Bank Syariah Indonesia (BRIS), and Bank Rakyat Indonesia (BRI) — loan expansion ranged between 12% and 19% YoY, outpacing peers. Nomura attributed the stronger performance largely to their greater involvement in the government’s Agrinas programme, which focuses on food security and agriculture initiatives.
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