Indonesia injects Rp400 trillion into state banks to boost growth

Jakarta (ANTARA) - Finance Minister Purbaya Yudhi Sadewa announced a massive capital injection of up to Rp400 trillion (US$22.38 billion) into the Association of State-Owned Banks (Himbara) to strengthen banking liquidity and sustain national economic growth.

The funding will be drawn from the government's Excess Budget Balance (SAL) remaining at Bank Indonesia (BI), which was recently recorded at Rp590 trillion (US$32.98 billion).

According to Purbaya, the decision was made in direct response to numerous complaints from state-owned bank directors regarding tightening liquidity conditions.

”There is already a liquidity shortage there. I told them I would return government funds to Himbara. I will even increase it... so there will be sufficient liquidity in our banking sector,” Purbaya said during a media briefing here on Friday.

The Rp400 trillion total comes as an expansion of previous government support.

Out of approximately Rp300 trillion allocated to Himbara in 2025, recent withdrawals left around Rp170 trillion in the system. In response, the government raised the baseline investment to Rp200 trillion.

To further insulate the financial sector, the Ministry of Finance decided to inject an additional Rp200 trillion, which will be disbursed in two separate installments of Rp100 trillion until the end of the year—bringing the total placement to Rp400 trillion.

Purbaya emphasized that the strategic move was not a unilateral decision, noting that she had fully coordinated with President Prabowo Subianto before finalizing the policy. The primary objective of the discussion was to ensure that the domestic economy continues to move forward dynamically.

"If the economy slows down, people fear that investors will leave. If we turn things around, the prospect of economic recovery will return. People tend to invest in countries where the economy is resilient, and as a result, the rupiah will strengthen again. That is the economic theory behind it," he explained.

Following the decision, the Finance Minister held a meeting with the president directors of Himbara banks on Friday. Purbaya noted that the banking leaders welcomed the liquidity booster with immense relief.

"They came to the meeting nervous, ready to get angry. As soon as I told them about the fund injection, they were happy," the minister concluded.

Related news: Prabowo eyes bigger Himbara role through export reform

Translator: Bayu Saputra, Yashinta Difa

Editor: M Razi Rahman

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