TEMPO.CO, Jakarta - Bank Indonesia (BI) is aggressively seeking for more inter-bank repurchase agreement (repo) transactions. Most banks are not enthusiastic when it comes to repos, as there are many requirements and conditions to be met by banks planning to sell their securities.
Yesterday, BI and 10 banks signed a global master repurchase agreement (GMRA). The agreement is expected to increase the number of inter-bank repo transactions.
"There is still a mismatch in money market transactions between (banks with) excessive short-term liquidity and those who need it," BI senior deputy governor Mirza Adityaswara said here on Thursday, August 25.
The 10 banks that signed the GMRA are 4 local banks; Bank Mandiri, BRI, BCA, BNI; and 6 foreign banks Standard Chartered Bank, DBS Bank, Mizuho Indonesia Bank, JP Morgan, Bank of Tokyo-Mitsubishi UFJ, and ANZ Bank.
With the addition of these ten, BI now has repo agreements with 65 banks.
BI's head of money market development Nanang Hendarsah said foreign banks' participation in repo transactions is important for the active management of rupiah liquidity in currency markets. "Their participation will boost the dynamics of Indonesia's money markets," he said.
GHOIDA RAHMAH