TheJakartaPost
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Economy in brief: RI to establish clearing house for derivatives
Bank Indonesia (BI) is preparing a central counterparty (CCP) as a clearing and settlement house for derivative transactions and expects it to be operational in 2018
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ank Indonesia (BI) is preparing a central counterparty (CCP) as a clearing and settlement house for derivative transactions and expects it to be operational in 2018.
“It [the CCP] is important as we have observed that the transactions in 118 banks are limited and segmented. A CCP will minimize the limitations of credit because it will cover the entire credit risk,” Nanang Hendarsah, BI’s financial market development department head, said in Jakarta on Thursday.
He pointed to India as a role model because transactions in markets, derivatives and government securities were reported to spike following the establishment of a CCP there.
Currently, Indonesia only has CCPs operating in equity markets, namely PT Kliring dan Penjaminan Efek Indonesia (KPEI) and PT Kliring Berjangka Indonesia (KBI), as well as PT Indonesia Clearing House (ICH) in commodity and futures markets.
However, such services are absent in the money market, foreign exchange and derivatives markets.
