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Erwin named new BI deputy governor
Competition: Bank Indonesia (BI) deputy governor candidates Erwin Rijanto (left), Hendy Sulistyowati (center) and Dody Budi Waluyo converse on the sidelines of a screening at the House of Representatives in Jakarta on Monday
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span class="inline inline-center">Competition: Bank Indonesia (BI) deputy governor candidates Erwin Rijanto (left), Hendy Sulistyowati (center) and Dody Budi Waluyo converse on the sidelines of a screening at the House of Representatives in Jakarta on Monday. Erwin was elected on Monday night to replace the current deputy governor Halim Alamsyah, who is to retire in June. Antara/Akbar Nugroho Gumay
The House of Representatives on Monday approved Erwin Rijanto as the new Bank Indonesia (BI) deputy governor overseeing financial system stability, a crucial post as the country braces for a global financial market rout ahead of the looming hike of US interest rates.
Erwin, currently a BI executive director for financial system surveillance, won 42 votes from lawmakers at House Commission XI overseeing the economy and finance.
He was selected over the BI executive director for strategic management and governance, Dody Budi Waluyo, and BI executive director for statistics Hendy Sulistiowati, who earned five votes and two votes, respectively.
The three candidates were nominated by President Joko 'Jokowi' Widodo to replace Halim Alamsyah, a deputy governor supervising banking and financial-system stability, whose term will expire in June.
During his confirmation hearing, Erwin said his priority would be to push for more breakthroughs in macro-prudential policies. 'BI needs to introduce various regulations such as the required counter-cyclical buffer for the banking sector given Indonesia's financial system dependence on the banking system,' he said.
Macro-prudential policies should also be tailored differently due to the differing economic situations at the regional levels, Erwin said.
He suggested that the loan-to-value (LTV) ratio regulation, which stipulates the minimum down payment a debtor must pay when owning a car credit or mortgage, should be tailored based on the economic conditions of each region.
To support growth at regional levels, there needed to be sustained efforts from BI in its financial-inclusion push to expand financial-services access for more Indonesians, he added.
He supported the central bank's involvement in international and regional forums such as G20 group meetings, but vowed to carefully implement policy suggestions, as not all would be appropriate to be applied in Indonesia.
'A formulation of policy and international standards with a 'copy-paste' approach, without sufficient study of its impact on national financial system stability, would do more harm than good,' Erwin said.
Erwin joined the central bank in 1985 after holding positions in several departments in the central bank, including in banking supervision, international affairs and media relations. He earned his Bachelors degree in economics from the Yogyakarta-based Universitas Gadjah Mada and holds a Master's degree in economics from the University of Illinois in the US. The central bank's six-man board of governors led by Agus Martowardojo is now grappling with a weakening rupiah, which is trading near its lowest level in a decade and an economy that has decelerated to its slowest level in five years.
Since taking charge of the central bank in 2013, Agus hiked the BI rate by a cumulative of 200 basis points to 7.75 percent, with aggressive monetary tightening that contributed to slowing economic growth.
