ID :
19061
Fri, 09/12/2008 - 10:49
Auther :
Shortlink :
http://m.oananews.org//node/19061
The shortlink copeid
LPS RAISES ITS RATE TO 9.25 PCT
Jakarta, Sept 11 (ANTARA) - The Deposit Insurance Agency (LPS) has raised its deposit insurance rate (LPS Rate) by 50 basis points to 9.25 percent for the Sept 15, 2008 - January 14, 2009 period in anticipation of a rise in lending rates.
LPS rate on foreign currency-denominated deposits remained unchanged at 3.50 percent, LPS Executive Chief Firdaus Djaelani said here on Thursday.
"The reason behind the decision is that banks will raise their lending rates in the next few months in response to relatively tight liquidity funds in the market," he said.
The decision to raise the LPS rate was also designed to anticipate the stubbornly high inflation rates during the Ramadhan fasting month, Lebaran post-fasting month festivities and New Year festivities, he said.
The deposit insurance rate on deposits in smallholder credit banks was set at 12.75 percent, he said.
Last week, Bank Indonesia (the central bank/BI) raised its benchmark interest rate to 9.25 percent in response to the expected high inflation rates in the next few months.
The increase in LPS rate was the biggest the agency had ever decided.
The on-year inflation rate reached 11.85 percent in August 2008. BI has set the inflation rate target at 11.5-12.5 percent for this year and 6.5-7.5 percent for next year.
LPS rate on foreign currency-denominated deposits remained unchanged at 3.50 percent, LPS Executive Chief Firdaus Djaelani said here on Thursday.
"The reason behind the decision is that banks will raise their lending rates in the next few months in response to relatively tight liquidity funds in the market," he said.
The decision to raise the LPS rate was also designed to anticipate the stubbornly high inflation rates during the Ramadhan fasting month, Lebaran post-fasting month festivities and New Year festivities, he said.
The deposit insurance rate on deposits in smallholder credit banks was set at 12.75 percent, he said.
Last week, Bank Indonesia (the central bank/BI) raised its benchmark interest rate to 9.25 percent in response to the expected high inflation rates in the next few months.
The increase in LPS rate was the biggest the agency had ever decided.
The on-year inflation rate reached 11.85 percent in August 2008. BI has set the inflation rate target at 11.5-12.5 percent for this year and 6.5-7.5 percent for next year.
