scholarly journals Analyzing the Impact of Financial Services Authority (OJK) Regulations in Supporting Economy Recovery During Covid-19 Pandemic: Evidence from Indonesia

2021 ◽  
Vol SP (2) ◽  
Author(s):  
Evi Aryati Arbay ◽  
Lusita Astuti Nusantari
Keyword(s):  
Financial Services ◽  
Banking Sector ◽  
Economic Recovery ◽  
Financial Service Authority ◽  
National Economic ◽  
Keynesian Economic ◽  
The Stability ◽  
The Impact ◽  
Banking Credit

COVID-19 has disrupted economic growth and business conditions globally including in Indonesia. One of the most obvious impacts is in the banking sector as many bank debtors have lost their livelihoods. This situation affects the quality of bank assets and profitability. An increase of non-performing loans experienced by some national banks has decreased the capability to generate optimal profit from bank operations that normally would keep the banks healthy, liquid, solvent, and in a profitable state. To strengthen the stability of Indonesian financial services and support the national economic recovery effort, the Financial Services Authority (OJK) issued several regulations on macroprudential policy relaxation and stimulus provision. The regulations ensure that banks are capable to control the bad credit of the debtors affected by the COVID-19 pandemic. This study aims to analyze the impact of Financial Service Authority Regulations on the quality of banking credit in supporting the Indonesian economic recovery during the COVID-19 pandemic. This is a qualitative study using a critical thinking analysis method to prove the assumption of Keynesian economic theory, which state that in a recession expansionary fiscal policy can stimulate economic activity. The results of this study indicate that the Financial Services Authority regulations have shown an impact in supporting the Indonesian economy recovery efforts amid the COVID-19 pandemic, which can be seen through the stability of the financial system. Further empirical and quantitative studies are needed to confirm the study findings.

scholarly journals The Impact of The Financial Services Authority Regulation on Banking Credit Quality in Improving Indonesia’s Economy During COVID-19 Pandemic: The Critical Thinking Analysis

2021 ◽  
Vol 2 (2) ◽  
Author(s):  
Christanto Arief Wahyudi ◽  
Evi Aryati Arbay ◽  
Lusita Astuti Nusantari ◽  
Lusita Astuti Nusantari
Keyword(s):  
Critical Thinking ◽  
Financial Services ◽  
Financial Service Authority ◽  
National Economic ◽  
Business Conditions ◽  
The Stability ◽  
Asset Quality ◽  
The Impact ◽  
Banking Credit

The impact of Covid-19 has impacted the asset quality and profitability of the banks and disrupted economic growth and business conditions globally. In one form of the decline in the economic sector, many members of society, including bank debtors, have lost their livelihoods. The enhancement of non-performing loans experienced by National Banks has resulted in banks losing their ability to generate optimal profit from bank operations so that the bank was always in a healthy, liquid, solvent, and profitable state. The Financial Services Authority issued several Financial Services Authority Regulations during 2020 to make sure that the bank can control bad credit of debtors affected by the Covid-19 outbreak. This study aimed to identify and analyze the impact of Financial Service Authority regulations on the quality of banking credit in improving the Indonesian economy amid the Covid-19 pandemic. This study used a qualitative approach with a critical thinking analysis method. The results of this study concluded that the impact of Financial Services Authority regulations on the quality of banking credit in improving the Indonesian economy amid the Covid-19 pandemic has been shown by the stability of the financial system, which was still well maintained the efforts of the Financial Services Authority to support the national economic recovery policy by Government of Indonesia.

scholarly journals Banking credit restructuring policy amid COVID-19 pandemic in Indonesia

2020 ◽  
Vol 5 (02) ◽  
Author(s):  
Hari Sutra Disemadi ◽  
Ali Ismail Shaleh
Keyword(s):  
Financial Services ◽  
Research Method ◽  
Secondary Data ◽  
Current Policy ◽  
Economic Stability ◽  
Legal Research ◽  
National Economic ◽  
The Impact ◽  
Banking Credit

In Indonesia, the spread of Coronavirus Disease 2019 (COVID-19) affects economic stability. The problem faced by Indonesia today is that the performance and capacity of debtors in carrying out their credit obligations have been disrupted by the spread of COVID-19, which has the potential to disrupt banking performance in credit management. Encouraging the optimization of the banking intermediary function a policy is needed in tackling the impact of the spread of COVID-19. The research method used is a normative legal research method using secondary data. The results of this study indicate that policy settings in overcoming economic instability due to the spread of COVID-19 are the issuance of policies to provide national economic stimulus through the application of Financial Services Authority Regulation No. 11/POJK.03/2020. This policy regulates the existence of credit restructuring, namely the quality of restructured loans can be determined smoothly if given to debtors identified as being affected by the spread of COVID-19. The implementation of the restructuring scheme can vary and is determined by the policies of each bank depending on the assessment of the debtor's profile and capacity to pay. We emphasize that amid uncertainty, such as the current policy will be truly useful if each party takes the process carefully and responsibly.

SISTEM KOORDINASI ANTARA OTORITAS JASA KEUANGAN (OJK) DENGAN LEMBAGA PENJAMIN SIMPANAN (LPS) DALAM PENANGANAN BANK GAGAL

2017 ◽  
Vol 6 (1) ◽  
pp. 1
Author(s):  
WIWIN WINTARSIH WINDIANTINA
Keyword(s):  
Economic Growth ◽  
Financial Services ◽  
Deposit Insurance ◽  
Banking Sector ◽  
Banking Industry ◽  
Financial Service ◽  
Financial Service Authority ◽  
Insurance Agency ◽  
Financial Transactions ◽  
The Impact

ABSTRACTThe banking industry is a dynamic sector along with economic growth, an increasing of complex financial transactions, and the impact from global trade, therefore the presence of an independent institutions is really needed. The Deposit Insurance Agency (LPS) is an institution that is independent, transparent and accountable in implementing its duties and authorities. As an independent agency, accountability is very important to be applied, so that stakeholders aware of what and how LPS implement the functions and duties as mandated by Law No. 24 of 2004 concerning the Deposit Insurance Agency (LPS). Procedurally, if the Financial Services Authority (OJK) indicate a bank that is experiencing liquidity problems, Financial Services Authority (OJK) immediately inform the Bank of Indonesia (BI) to take steps in accordance with BI's authority. In practise, Financial Service Authority (OJK) coordinate withBank of Indonesia (BI) to make regulatory supervision in banking sector. Coordination in handling between failed banks between the Deposit Insurance Agency (LPS) and Financial Services Authority (OJK) is shown by a confirmation from Financial Services Authority (OJK) to the Deposit Insurance Agency (LPS) about troubled banks that are in the restructuring efforts by Financial Services Authority (OJK), then the Deposit Insurance Agency (LPS) investigate the banks in accordance with its functions, duties and responsibilities. The Deposit Insurance Agency (LPS) as an institution that checks condition of banks surely will review and determine whether the troubled banks will be saved or not saved.

scholarly journals Default of Banking Credit Agreements in the Time of Covid 19

2021 ◽  
Vol 4 (2) ◽  
pp. 1925-1933
Author(s):  
Sri Dewi ◽  
Sriono Sriono ◽  
Elviana Sagala
Keyword(s):  
Financial Services ◽  
Judicial Power ◽  
Force Majeure ◽  
National Economic ◽  
Law And Justice ◽  
The Government ◽  
Credit Agreement ◽  
National Disaster ◽  
The Impact ◽  
Banking Credit

The covid 19 pandemic resulted in a very significant economic impact, and resulted in many defaults on bank credit agreements which underwent payment restructuring based on the covid 19 virus. Financial Services Authority (OJK) Regulation No. 11/POJK.03/2020 concerning the national economic stimulus as a countercyclical policy for the impact of the spread of covid 19 gives authority to banks to establish policies that support economic growth stimulus for debtors affected by the spread of covid 19, one of which is credit or financing restructuring policies. The occurrence of a national disaster caused by the Covid 19 virus had an impact on the force majeure situation. That defaults due to the spread of the covid-19 virus have resulted in debtors being negligent in carrying out their obligations, this method uses the normative juridical method, which refers to the provisions of positive laws and regulations in Indonesia. The results of the research show that defaults in the credit agreement cannot be used as an excuse for not fulfilling their obligations. The spread of covid-19 cannot be used as an excuse that causes a compelling situation that requires the debtor to commit an act of default. In the concept of a rule of law, judicial power is independent in carrying out its judicial function, thus enabling the exercise of judicial power to be fair in examining, adjudicating and deciding cases based on law and justice. Then the policy of the regulations issued by the government against the spread of the covid-19 virus is very important for the community regarding the problem of the spread of the covid-19 virus.

scholarly journals The Impact of OJK Regulation No. 48/POJK.03/2020 on the Quality of Credit and Risk Management of Banking Credit

2021 ◽  
Author(s):  
Christanto Arief Wahyudi ◽  
Evi Aryati Arbay
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Secondary Data ◽  
Credit Risk Management ◽  
The Government ◽  
The Stability ◽  
And Control ◽  
The Impact ◽  
Banking Credit

The COVID-19 pandemic, which is spreading rapidly throughout the world, has seriously harmed many countries, including Indonesia. Many things have been detrimental due to COVID-19, one of which is the economic aspect. This pandemic made it difficult for many debtors to fulfil their credit obligations that led the government to issue a countercyclical policy to provide a stimulus to the national economy. This study aims to determine the impact of OJK Regulation No.48 of 2020 on credit quality and control of banking credit risk in Indonesia. The research method used is descriptive qualitative with a literature approach using secondary data. This OJK regulation regulates economic stimulus through credit restructuring and regulates the implementation of credit risk management in banks. The existence of this regulation can maintain the stability of banking performance by keeping the Non-Performing Loan (NPL) number below 5% and providing a reference for banks in risk management with a model that is relevant to economic conditions during the COVID-19 pandemic.

scholarly journals Stimulus Kredit Perbankan: Kebijakan Penanggulangan Risiko Kredit Akibat Coronavirus Disease 2019 (COVID-19) di Indonesia

2021 ◽  
Vol 10 (3) ◽  
pp. 563
Author(s):  
Hari Sutra Disemadi
Keyword(s):  
Financial Services ◽  
Research Method ◽  
System Stability ◽  
Credit Risk Management ◽  
Economic Stability ◽  
Economic Cycle ◽  
National Economic ◽  
The Government ◽  
The Stability ◽  
The Impact

The spread “of Coronavirus Disease 2019 or COVID-19 affects the economic stability of a country. Indonesia is one of the countries whose economic stability is disrupted “due to the spread of COVID-19. The problem currently facing Indonesia is that the performance and capacity of debtors in carrying out their credit obligations has been disrupted by the spread of COVID-19, which has the potential to disrupt banking performance in credit management. Therefore, the aim of this research is to find out and study the government's efforts in encouraging the banking intermediation function, maintaining financial system stability and supporting economic growth, a policy is needed as a legal strategy in overcoming the impact of the COVID-19 pandemic, particularly the impact on the performance and capacity of debtors in carry out its credit obligations. The research method used is a normative legal research method by utilizing legal materials. The results of this study indicate that the regulation of credit risk management policies” in Indonesia has been regulated in existing laws and regulations such as the Law on Banking; Law concerning Sharia Banking; Bank Indonesia Regulations; and Financial Services Authority Regulations. “The effort chosen by the government in overcoming economic instability due to the spread of COVID-19 is the issuance of a policy to provide a national economic stimulus through the application of Financial Services Authority Regulation No. 11/POJK.03/2020. This policy is “countercyclical” due to the” policies used in maintaining the stability of the economic” cycle. Penyebaran Coronavirus Disease “2019 atau COVID-19 mempengaruhi kestabilan ekonomi suatu negara. Indonesia merupakan salah satu negara yang kestabilan ekonominya terganggu akibat penyebaran COVID-19. Permasalahan yang dihadapi Indonesia saat ini adalah kinerja serta kapasitas debitur dalam melaksanakan kewajiban kreditnya telah terganggu dengan adanya penyebaran COVID-19, sehingga berpotensi mengganggu kinerja perbankan dalam pengelolaan kredit. Maka dari itu, tujuan penelitian ini adalah untuk mengetahui dan mengkaji upaya pemerintah dalam mendorong fungsi intermediasi perbankan, menjaga stabilitas sistem keuangan dan mendukung pertumbuhan ekonomi diperlukan adanya” kebijakan sebagai strategi hukum dalam menanggulangi dampak Pandemi COVID-19, “khususnya dampak bagi kinerja serta kapasitas debitur dalam “melaksanakan kewajiban kreditnya. Metode penelitian yang digunakan adalah metode penelitian hukum normatif dengan memanfaatkan bahan-bahan hukum. Hasil penelitian ini menunjukkan pengaturan kebijakan manajemen risiko kredit di Indonesia telah diatur dalam peraturan perundang-undangan yang ada seperti Undang-Undang tentang Perbankan; Undang-Undang tentang Perbankan Syariah; Peraturan Bank Indonesia; dan Peraturan Otoritas Jasa Keuangan.   Upaya yang dipilih oleh pemerintah dalam mengatasi ketidakstabilan perekonomian akibat penyebaran COVID-19 adalah diterbitkannya kebijakan pemberian stimulus perekonomian nasional melalui penerapan Peraturan Otoritas Jasa Keuangan No. 11/POJK.03/2020.” Kebijakan ini bersifat “countercyclical” dikarenakan kebijakan” yang digunakan dalam menjaga kestabilan siklus perekonomian

scholarly journals The Impact of OJK Regulation No. 48/POJK.03/2020 the Quality of Credit and Risk Management of Banking Credit

2021 ◽  
Vol 4 (1) ◽  
Author(s):  
Christanto Arief Wahyudi ◽  
◽  
Evi Aryati Arbay ◽  
Keyword(s):  
Risk Management ◽  
Credit Risk ◽  
Secondary Data ◽  
Credit Risk Management ◽  
The Government ◽  
The Stability ◽  
And Control ◽  
The Impact ◽  
Banking Credit

The COVID-19 pandemic, which is spreading rapidly throughout the world, has seriously harmed many countries, including Indonesia. Many things have been detrimental due to COVID-19, one of which is the economic aspect. This pandemic made it difficult for many debtors to fulfil their credit obligations that led the government to issue a countercyclical policy to provide a stimulus to the national economy. This study aims to determine the impact of OJK Regulation No.48 of 2020 on credit quality and control of banking credit risk in Indonesia. The research method used is descriptive qualitative with a literature approach using secondary data. This OJK regulation regulates economic stimulus through credit restructuring and regulates the implementation of credit risk management in banks. The existence of this regulation can maintain the stability of banking performance by keeping the Non-Performing Loan (NPL) number below 5% and providing a reference for banks in risk management with a model that is relevant to economic conditions during the COVID-19 pandemic.

The Systemic Effects of Prudential Regulation Toughening:The Results of a Stress-test for Russian Banks

2012 ◽  
pp. 4-31 ◽  
Author(s):  
M. Mamonov ◽  
A. Pestova ◽  
O. Solntsev
Keyword(s):  
Financial Services ◽  
Banking Sector ◽  
Stress Test ◽  
Credit Market ◽  
Capital Adequacy ◽  
Government Support ◽  
Government Ownership ◽  
Prudential Regulation ◽  
The Government ◽  
The Stability

The stability of Russian banking sector is threatened by three negative tendencies - overheating of the credit market, significant decrease of banks capital adequacy ratios, and growing problems associated with banks lending to affiliated non-financial corporations. The co-existence of these processes reflects the crisis of the model of private investments in Russian banking sector, which was observed during the last 20 years. This paper analyzes the measures of the Bank of Russia undertaken to maintain the stability of the banking sector using the methodology of credit risk stress-testing. Based on this methodology we conclude that the Bank of Russias actions can prevent the overheating of the credit market, but they can also lead to undesirable effects: further expansion of the government ownership in Russian banking sector and substitution of domestic credit supply by cross-border corporate borrowings. The later weakens the competitive positions of Russian banks. We propose a set of measures to harmonize the prudential regulation of banks. Our suggestions rely on design and further implementation of the programs aimed at developing new markets for financial services provided by Russian banks to their corporate and retail customers. The estimated effects of proposed policy measures are both the increase in profitability and capitalization of Russian banks and the decrease of banks demand for government support.

COVID -19 and Indian Financial Markets: A Review

2020 ◽  
Vol 16 (02) ◽  
pp. 1-8
Author(s):  
Kamaldeep Kaur Sarna
Keyword(s):  
Financial Markets ◽  
Financial Institutions ◽  
Financial Services ◽  
Stock Markets ◽  
Global Economy ◽  
Banking Sector ◽  
Global Financial Crisis ◽  
Negative Impact ◽  
Management Strategies ◽  
The Impact

COVID-19 is aptly stated as a Black Swan event that has stifled the global economy. As coronavirus wreaked havoc, Gross Domestic Product (GDP) contracted globally, unemployment rate soared high, and economic recovery still seems a far-fetched dream. Most importantly, the pandemic has set up turbulence in the global financial markets and resulted in heightened risk elements (market risk, credit risk, bank runs etc.) across the globe. Such uncertainty and volatility has not been witnessed since the Global Financial Crisis of 2008. The spread of COVID-19 has largely eroded investors’ confidence as the stock markets neared lifetimes lows, bad loans spiked and investment values degraded. Due to this, many turned their backs on the risk-reward trade off and carted their money towards traditionally safer investments like gold. While the banking sector remains particularly vulnerable, central banks have provided extensive loan moratoriums and interest waivers. Overall, COVID-19 resulted in a short term negative impact on the financial markets in India, though it is making a way towards V-shaped recovery. In this context, the present paper attempts to identify and evaluate the impact of the pandemic on the financial markets in India. Relying on rich literature and live illustrations, the influence of COVID-19 is studied on the stock markets, banking and financial institutions, private equities, and debt funds. The paper covers several recommendations so as to bring stability in the financial markets. The suggestions include, but are not limited to, methods to regularly monitor results, establishing a robust mechanism for risk management, strategies to reduce Non-Performing Assets, continuous assessment of stress and crisis readiness of the financial institutions etc. The paper also emphasizes on enhancing the role of technology (Artificial Intelligence and Virtual/Augmented Reality) in the financial services sector to optimize the outcomes and set the path towards recovery.

FIFA – highlighting the links between global banking and international money laundering

2018 ◽  
Vol 21 (4) ◽  
pp. 498-512 ◽  
Author(s):  
Mohammed Ahmad Naheem
Keyword(s):  
Money Laundering ◽  
Financial Services ◽  
Banking Sector ◽  
Due Diligence ◽  
Content Type ◽  
Services Sector ◽  
Financial Services Sector ◽  
Global Banking ◽  
Beneficial Ownership ◽  
The Impact

PurposeThis paper uses the recent (August 2015) FIFA arrests to provide an example of how illicit financial flows are occurring through the formal banking and financial services sector. The purpose of this paper is to explore which elements of anti-money laundering (AML) compliance need to be addressed to strengthen the banking response and reduce the impact of IFFs within the banking sector.Design/methodology/approachThe paper is based on the indictment document currently prepared for the FIFA arrests and the District Court case of Chuck Blazer the FIFA Whistleblower. It uses the banking examples identified in the indictment as typologies of money laundering and wire fraud. Corresponding industry reports on AML compliance are included to determine where the major weaknesses and gaps are across the financial service.FindingsThe main findings from the analysis are that banks still have weak areas within AML compliance. Even recognised red flag areas such as off shore havens, large wire transfers and front companies are still being used. The largest gaps still appear to be due diligence and beneficial ownership information.Research limitations/implicationsThe research topic is very new and emerging topic; therefore, analysis papers and other academic writing on this topic are limited.Practical implicationsThe research paper has identified a number of implications for the banking sector, addressing AML deficiencies, especially the need to consider the source of funds and the need for further enhanced due diligence systems for politically exposed and influential people and the importance of beneficial ownership information.Social implicationsThis paper has implications for the international development and the global banking sector. It will also influence approaches to AML regulation, risk assessment and audit within the broader financial services sector.Originality/valueThe originality of this paper is the link between the emerging issues associated with allegations of bribery and corruption within FIFA and the illicit financial flow implications across the banking sector.

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