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Indonesia aims for fivefold growth in gold savings with new bullion bank
Two state-owned enterprises (SOEs) will be its first and major players, namely state-owned pawnbroker PT Pegadaian, a subsidiary of state-owned lender Bank Rakyat Indonesia (BRI), and Bank Syariah Indonesia (BSI), the country’s largest sharia bank.
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President Prabowo Subianto inaugurates the country’s first bullion banking service on Wednesday in a bid to capture more value from its vast gold reserves and accelerate growth. Southeast Asia’s largest economy is home to the world’s sixth-largest gold reserves, but sees much of its mined gold stored overseas.
(Courtesy of/Presidential Secretariat)
P
resident Prabowo Subianto inaugurated the country’s first bullion banking service on Wednesday in a bid to capture more value from its vast gold reserves and accelerate economic growth.
Two state-owned enterprises (SOEs) will be its first and major players, namely state-owned pawnbroker PT Pegadaian, a subsidiary of state-owned lender Bank Rakyat Indonesia (BRI), and Bank Syariah Indonesia (BSI), the country’s largest sharia bank.
They aim for a fivefold increase in gold savings and deposits over the next five years as well as boosting transactions involving the commodity.
“We hope [the bullion bank] will boost our gross domestic product. We will improve the ecosystem of service, and we hope to accelerate deposits and increase our gold reserves,” Prabowo said in his remarks during the launching event at The Gade Tower, Jakarta.
Read also: Indonesia approves first bullion bank
A bullion bank is a financial institution that deals in precious metals, including gold, offering services like gold deposits, trading, financing and custody, all of which will be supervised by the Financial Services Authority (OJK).
Southeast Asia’s largest economy is home to the world’s sixth-largest gold reserves but sees much of its mined gold stored overseas. Indonesia produces about 160 tonnes of gold annually but retains relatively little domestically.
