No. 14/ 19 /PSHM/Humas
The Governor of Bank Indonesia, Darmin Nasution, has signed two memorandums of understanding on cross-border banking supervision. Signatories include the Chairman of the Australian Prudential Regulation Authority, John Laker, as well as the Chairman of the Financial Services Commission of Korea, Seok-Dong Kim, and the Governor of the Financial Supervisory Service of Korea, Hyouk-Se Kwon. Both agreements are effective as of 6th June 2012.
"Bank Indonesia is committed to strengthen banking supervision in Indonesia, among others, by intensifying cooperation with financial supervisory authorities overseas in order to bolster the effective supervision of banking groups operating internationally," remarked the Governor of Bank Indonesia. Such efforts constitute a tangible follow-up measure to the Financial Sector Assessment Program (FSAP) implemented by the World Bank and IMF in 2009/2010.
The signing of the memorandum of understanding is expected to garner momentum among the institutions involved to mutually exchange information and enhance cooperation in the area of banking supervision, thereby building inter-authority understanding as well as boosting banking industry performance in each respective country.
Information exchange and increased collaboration among the participating institutions specifically consists of: (i) exchanging information concerning the outcome of bank supervision; (ii) introducing cross-border bank inspections made possible by a cooperative inspection process; (iii) organising regular mattings (supervisory colleges); and (iv) exchanging information on the progress of bank supervision in general, including the establishment of banks operating across borders.
Bank Indonesia, the Australian Prudential Regulation Authority, the Financial Services Commission of Korea and the Financial Supervisory Service of Korea welcomed the signing of this agreement and expressed confidence that its implementation will provide a number of mutual benefits to all institutions involved.
Previously, in 2010 Bank Indonesia signed a similar memorandum of understanding with Bank Negara Malaysia, the China Banking Regulatory Commission and the Monetary Authority of Singapore.
Jakarta, 20th June 2012
Office of the Governor
Dody Budi Waluyo