Banking - Covid-19 loan restructuring end soon, bad loan continues declined

Banking - Covid-19 loan restructuring end soon, bad loan continues declined The credit restructuring policy due to Covid-19 is certain to end in March 2024. As a result, there is the potential for credit portfolios that were initially restructured to fall into the bad credit or NPL category after the relaxation is lifted. Indeed, on an ongoing basis, the Financial Services Authority (OJK) notes that the number of restructured loans continues to experience a downward trend. As of November 2023, the remaining credit amount is IDR 285.3 tn with a recorded number of customers of 1.14 mn customers. (Source: Kontan) Comment: We believe the amount of covid restructured loan will continue to decline. We also view that by the time the relaxation is fully lifted in Mar24, bank under our coverage will continue in a well shape condition, backed by continuing asset quality improvement.