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Ada Pertanyaan? Hubungi Kami Fathan Qorib, Yanuar Pribadhie
While the banking sector in Indonesian is currently in reasonable shape, regional and global circumstances could dramatically change at any time. In anticipation of this possibility, the Financial Services Authority (OJK) says that consolidation of banks is one solution to maintain bank liquidity and growth.
“This year 2014 is the right time for consolidation given what will happen in the world economy during this year. Once we have a chance, OJK will encourage banks to consolidate,” says Muliaman D. Hadad, Chairman of OJK’s Board of Commissioners, in Jakarta on Monday.
Muliaman is of the view that consolidation is critical when it comes to the management of banks that are operating in Indonesia. He stated that Bank Indonesia Regulation No. 14/8/2012 on Shares Ownership of Commercial Banks may be the one of the key success factors for realizing consolidations.
The Regulation essentially requires banking security enhancement in the middle of rapid regional and global economic development. To that end, banks may implement banking prudence and good corporate governance principles. However, Muliaman emphasizes that in implementing any consolidations, other challenges in banking industry need to be given due consideration.
“For example, non-performing loans, capital strengthening and liquidity. These challenges should be carefully taken into account in consolidations,” explained Muliaman.
Tony A Prasetiantono, and economist at Universitas Gadjah Mada, asserts that consolidation between banks in 2014 may prevent domestic banking from being affected by global policy or changes in global circumstances.
The economist notes that declining unemployment in United States is resulting in the tapering off policy by the US government. As a consequence, the Jakarta stock exchange’s Joint Shares Price Index will decline and the Rupiah will depreciate.
However, Tony also emphasizes the downside of consolidation in the banking sector, such as possible mass layoffs. To mitigate such impacts, Tony suggests that consolidation must be carried out along with capital strengthening.
Tony further concludes that consolidation is important because the current number of banks operating in Indonesia, some 120 banks, is excessive. Ideally, Indonesia should have around 70 banks.
“It is better that we have fewer bank with more branches than otherwise,” said Tony.
(hot/kc)
While the banking sector in Indonesian is currently in reasonable shape, regional and global circumstances could dramatically change at any time. In anticipation of this possibility, the Financial Services Authority (OJK) says that consolidation of banks is one solution to maintain bank liquidity and growth.
“This year 2014 is the right time for consolidation given what will happen in the world economy during this year. Once we have a chance, OJK will encourage banks to consolidate,” says Muliaman D. Hadad, Chairman of OJK’s Board of Commissioners, in Jakarta on Monday.
Muliaman is of the view that consolidation is critical when it comes to the management of banks that are operating in Indonesia. He stated that Bank Indonesia Regulation No. 14/8/2012 on Shares Ownership of Commercial Banks may be the one of the key success factors for realizing consolidations.
The Regulation essentially requires banking security enhancement in the middle of rapid regional and global economic development. To that end, banks may implement banking prudence and good corporate governance principles. However, Muliaman emphasizes that in implementing any consolidations, other challenges in banking industry need to be given due consideration.
“For example, non-performing loans, capital strengthening and liquidity. These challenges should be carefully taken into account in consolidations,” explained Muliaman.
Tony A Prasetiantono, and economist at Universitas Gadjah Mada, asserts that consolidation between banks in 2014 may prevent domestic banking from being affected by global policy or changes in global circumstances.
The economist notes that declining unemployment in United States is resulting in the tapering off policy by the US government. As a consequence, the Jakarta stock exchange’s Joint Shares Price Index will decline and the Rupiah will depreciate.
However, Tony also emphasizes the downside of consolidation in the banking sector, such as possible mass layoffs. To mitigate such impacts, Tony suggests that consolidation must be carried out along with capital strengthening.
Tony further concludes that consolidation is important because the current number of banks operating in Indonesia, some 120 banks, is excessive. Ideally, Indonesia should have around 70 banks.
“It is better that we have fewer bank with more branches than otherwise,” said Tony.
(hot/kc)
Fathan Qorib, Yanuar Pribadhie
While the banking sector in Indonesian is currently in reasonable shape, regional and global circumstances could dramatically change at any time. In anticipation of this possibility, the Financial Services Authority (OJK) says that consolidation of banks is one solution to maintain bank liquidity and growth.
“This year 2014 is the right time for consolidation given what will happen in the world economy during this year. Once we have a chance, OJK will encourage banks to consolidate,” says Muliaman D. Hadad, Chairman of OJK’s Board of Commissioners, in Jakarta on Monday.
Muliaman is of the view that consolidation is critical when it comes to the management of banks that are operating in Indonesia. He stated that Bank Indonesia Regulation No. 14/8/2012 on Shares Ownership of Commercial Banks may be the one of the key success factors for realizing consolidations.
The Regulation essentially requires banking security enhancement in the middle of rapid regional and global economic development. To that end, banks may implement banking prudence and good corporate governance principles. However, Muliaman emphasizes that in implementing any consolidations, other challenges in banking industry need to be given due consideration.
“For example, non-performing loans, capital strengthening and liquidity. These challenges should be carefully taken into account in consolidations,” explained Muliaman.
Tony A Prasetiantono, and economist at Universitas Gadjah Mada, asserts that consolidation between banks in 2014 may prevent domestic banking from being affected by global policy or changes in global circumstances.
The economist notes that declining unemployment in United States is resulting in the tapering off policy by the US government. As a consequence, the Jakarta stock exchange’s Joint Shares Price Index will decline and the Rupiah will depreciate.
However, Tony also emphasizes the downside of consolidation in the banking sector, such as possible mass layoffs. To mitigate such impacts, Tony suggests that consolidation must be carried out along with capital strengthening.
Tony further concludes that consolidation is important because the current number of banks operating in Indonesia, some 120 banks, is excessive. Ideally, Indonesia should have around 70 banks.
“It is better that we have fewer bank with more branches than otherwise,” said Tony.
(hot/kc)
While the banking sector in Indonesian is currently in reasonable shape, regional and global circumstances could dramatically change at any time. In anticipation of this possibility, the Financial Services Authority (OJK) says that consolidation of banks is one solution to maintain bank liquidity and growth.
“This year 2014 is the right time for consolidation given what will happen in the world economy during this year. Once we have a chance, OJK will encourage banks to consolidate,” says Muliaman D. Hadad, Chairman of OJK’s Board of Commissioners, in Jakarta on Monday.
Muliaman is of the view that consolidation is critical when it comes to the management of banks that are operating in Indonesia. He stated that Bank Indonesia Regulation No. 14/8/2012 on Shares Ownership of Commercial Banks may be the one of the key success factors for realizing consolidations.
The Regulation essentially requires banking security enhancement in the middle of rapid regional and global economic development. To that end, banks may implement banking prudence and good corporate governance principles. However, Muliaman emphasizes that in implementing any consolidations, other challenges in banking industry need to be given due consideration.
“For example, non-performing loans, capital strengthening and liquidity. These challenges should be carefully taken into account in consolidations,” explained Muliaman.
Tony A Prasetiantono, and economist at Universitas Gadjah Mada, asserts that consolidation between banks in 2014 may prevent domestic banking from being affected by global policy or changes in global circumstances.
The economist notes that declining unemployment in United States is resulting in the tapering off policy by the US government. As a consequence, the Jakarta stock exchange’s Joint Shares Price Index will decline and the Rupiah will depreciate.
However, Tony also emphasizes the downside of consolidation in the banking sector, such as possible mass layoffs. To mitigate such impacts, Tony suggests that consolidation must be carried out along with capital strengthening.
Tony further concludes that consolidation is important because the current number of banks operating in Indonesia, some 120 banks, is excessive. Ideally, Indonesia should have around 70 banks.
“It is better that we have fewer bank with more branches than otherwise,” said Tony.
(hot/kc)