Banking Is Far From Collapsing: OJK

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  • Ekonom Standard Chartered Bank, Fauzi Ichsan. TEMPO/Dasril Roszandi

    Ekonom Standard Chartered Bank, Fauzi Ichsan. TEMPO/Dasril Roszandi

    TEMPO.CO, Jakarta - The Financial Services Authority (OJK) until now has not indicated to divert failing commercial banks to Deposititory Insurance Corporation (LPS).

    "The situation is relatively safe," said Acting Chief Executive of OJK Fauzi Ichsan to Tempo on Wednesday, September 9.

    According to Fauzi, this year’s capital adequacy ratio (CAR) of banks reached 20 percent, better than the 2008 crisis, which only reached 17 percent. "20 percent is the highest in history," said Fauzi, who previously was chief economist of Standard Chartered Bank.

    The banking situation today is stronger than in 1998 and 2008. "We've faced crises in 1998, then 2008. The banks stress test was still strong, this year is even stronger," he said.

    Moch. Doddy Ariefianto, LPS Group Director of Economic and Financial Systems, said banking in Indonesia is still manageable even if the rupiah exchange rate reach Rp18,000 against the US dollar.

    "But I don’t know [if it is manageable] above the Rp 20 thousand level,” Fauzi added.

    According to Fauzi, assets managed by the LPS to deal with the crisis this year almost reached Rp 60 trillion. Compared to 2008, ths value is under Rp 14 trillion.

    MAYA AYU