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Non-bank finance industry 'alternative solution' during crisis: OJK
The Financial Services Authority (OJK) says Indonesiaâs non-bank finance industry (IKNB) can become an alternative solution in the occurrence of an economic crisis, as it has a huge amount of assets and does not have pressing needs for liquidity
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he Financial Services Authority (OJK) says Indonesia's non-bank finance industry (IKNB) can become an alternative solution in the occurrence of an economic crisis, as it has a huge amount of assets and does not have pressing needs for liquidity.
'The IKNB can play a role as a spare tire in the midst of a crisis. Banks have a limited role in carrying out intermediary functions during a crisis due to increased liquidity needs. Meanwhile, the IKNB can support economic activities during a crisis as they don't have pressing needs of liquidity,' OJK's IKNB monitoring executive head, Firdaus Djaelani, said as quoted by Antara on Wednesday. He was speaking in an event in Jakarta on Tuesday.
Firdaus said Indonesia's economic slowdown had led the country's financial services sector to suffer shocks so there should be effective mitigation efforts to overcome the crisis.He said the IKNB could help resolve financial market shocks via stocks or capital market bonds. It could also play a role as local investors in absorbing government bonds. (ebf)(++++)
