Banking - Optimistic demand deposit growth will return to normal

Banking - Optimistic demand deposit growth will return to normal Banking liquidity conditions are being overshadowed by tightening due to minimal growth in third party funds. As of October 2023, banking deposits only grew 3.9% yoy to IDR 7,982 tn. Savings in the form of current accounts grew the slowest, namely only around 1.8% yoy to IDR 2,399 tn. This growth slowed significantly from the previous month. (Source: Kontan). Comment: We expect better government spending and election related spending as well as better minimum provisional wage could play significant role to SA growth. CASA will continue stable backed by our expectation on CA growth, in our view. Other things being equal, TD growth could softened as we expect peaking rate in ‘24F and thus could drive CASA to increase further.