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Jakarta Post

Bank ownership revision will encourage investment

  • Made Anthony Iswara
    Made Anthony Iswara

    The Jakarta Post

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Jakarta   /   Wed, August 7, 2019   /  11:30 am
The Jakarta Post Image
The Financial Services Authority (OJK) logo is seen on the frontispiece at its headquarters in Jakarta.(kontan.co.id/File)

Banks welcomed the Financial Services Authority's (OJK) plan to relax bank ownership rules as it is expected to encourage more deals in the banking industry, although it comes with risks. OJK banking supervisory division head Heru Kristiayana confirmed that the agency would soon no longer require banks within the third and fourth quartiles to have a single ownership system in its acquisition process with small banks, which could later function into specialized satellite institutions. “The relaxation will act as a sweetener for bigger banks to consolidate with smaller banks. Otherwise, they may not find it worthwhile to merge with smaller banks,” Heru told The Jakarta Post on Friday, without disclosing details of the timeline of the policy revision. The so-called single presence policy, rolled out in 2006 to consolidate 2,000 banks in the country, obliges local ba...