Banking - Interest in investment start to pick, demand for loan increases

Banking - Interest in investment start to pick, demand for loan increases Investment interest in Indonesia seems to be starting to grow. This can be seen from the increasing demand for investment credit. Based on Bank Indonesia data as of April 2024, investment credit reached IDR1,921.8 tn or an increase of 14.6% mom from the previous month at 14% or IDR1,912.2 tn. The Financial Services Authority also stated that, on an annual basis, credit continued its double digit growth, namely 13.09% annually or yoy to IDR7,310.7 tn. 
Based on type of use, investment credit grew the highest, namely 15.69% . A number of banks also recorded an increase in investment credit. Like Bank Central Asia (BCA), which as of March 2024, investment credit rose 25.8% to IDR277.7 tn. (Source: Kontan) Comment : Total loan in April 2024 arrive around 300bps higher than our ‘24F projection for banking industry total loan and surpassing both OJK and Bank Indonesia expectation. Of the total 10%, we expect working capital loan to overall underpin the growth, followed by investment loan. Consumer loan will also play crucial part to the overall loan. Maintain our Overweight stance for banking sector, with BBRI and BBNI as our top picks.