OJK: SVB Fallout to Not Directly Impact Indonesian Banks

By Editorial Team 14/03/2023
Summary

Indonesia's Financial Services Authority (OJK) assessed that Silicon Valley Bank (SVB) closure by the US Federal Deposit Insurance Corporation (FDIC) on March 10 would not have a direct impact on the country's banking industry. OJK Banking Supervisor Chief Executive Dian Ediana Rae said the Indonesian banking industry is robust and stable.

Dian Ediana Rae further clarified that the closure of SVB is not expected to directly affect banks in Indonesia that have no business relationships, facility lines, or investments in SVB securitization products.

This is because banks in Indonesia do not provide credit or investment to technology-based startups and crypto companies, unlike SVB and banks in the US in general.

"Therefore, OJK expects the public and industry not to be affected by the developing speculations among them," Dian said in an official statement on Monday.

Indonesia's banking industry has taken fundamental steps to strengthen its institutions, legal infrastructure, and governance and protect its customers after the 1998 financial crisis. These steps have resulted in a robust, resilient, and stable banking system.

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