Deputy Governor of Bank Indonesia Muliaman D. Hadad has delivered a package of Banking Regulation of April 2008, on Tuesday, 15th April 2008, in Jakarta.
Some of the factors behind the issuance of such policy package are (i) the need to overcome the problems faced by small businesses in obtaining bank financing, (ii) the need to undertake financial deepening and stimulate capital market development, (iii) the need to improve and strengthen the institutional structure of banks, and (iv) the need to improve bank risk management through the implementation of Basel II with the support of the rating industry.
"The banking regulation package is expected to be stimulant of economic growth and a tool to maintain financial stability in the midst of the non-conducive global economic condition we are facing," Muliaman announced.
The regulation package consists of (i) the provision on the reduction in the calculation of Risk Weighted Assets (RWA) of Small Business Loan (Kredit Usaha Kecil - KUK) guaranteed by the Loan Insurance Institution that meet certain requirements, (ii) the provision on the reduction in the calculation of Risk Weighted Assets (RWA) of corporate bonds, (iii) the provision on the increase of legal lending limit (LLL) to debtors not categorized as the bank's affiliated parties, (iv) the provision on the establishment of commercial banks and other institutional provisions, (v) the provision on the implementation of Basel II, and (iv) the provision on rating companies and ratings recognized by Bank Indonesia.
The articles of the abovementioned provisions are presented in the appendices. Broadcasted by Dyah N.K. Makhijani in the press release of Bank Indonesia.
(FDT, source: http://www.bi.go.id/web/id/Siaran Pers/sp_102108.htm)