BI to Supervise Financial Conglomerates

TEMPO.CO, Jakarta - Executive Director of the Communications Department of Bank Indonesia Puri Tirta said that Bank Indonesia (BI) would participate in supervising financial conglomerates, following concerns about the impact of disruption to the conglomerates to other sectors.

"If there is a disruption in its business sector, it is feared that it could affect other sectors," Puri Tirta said on Friday, September 26, 2014.

Bank Indonesia's supervision of the conglomerate in an integrated manner.

Puri added that most of the financial conglomerate supervision is carried out by the Financial Services Authority. However, supervision by Bank Indonesia has continued to be done until now although the country has the Financial Services Authority (OJK), which is in charge of supervising the financial sector.

"Since 2004 or 2005, we have always supervised conglomerates," Puri added.

On Friday, Head of the OJK Department of Development, Supervision and Crisis Management Divisin Sampoerna Armanto said that OJK has found dozens of identified financial conglomerates in Indonesia.  He added that financial conglomerates do activities in three sectors: banking, non-bank financial institutions, and capital markets.

"There are as many as 31 financial conglomerates in Indonesia that consists of a group of vertical, horizontal groups, and mixed groups," said Sampoerna.

For the record, financial conglomerates in Indonesia control almost 70 percent of the total assets of the financial sector in Indonesia.

MAYA NAWANGWULAN