CIREBON - The Financial Services Authority (OJK) continues to encourage the banking industry including the Bank Perkreditan Rakyat (BPR) to strengthen its institutions by improving capital structure through mergers. BPR merger is part of the Banking Consolidation Program in order to strengthen the banking industry.
"To strengthen a healthy and productive BPR industry, a strong capital support is needed by BPR institution so that it can provide funds to the real sector, especially micro and small businesses, and so that BPR can absorb the risks that may occur," said OJK's Banking Chief Executive Officer, Heru Kristiyana at the launch of the Cirebon Regional Government BPR merger (PD) in Cirebon on Thursday.
Cirebon District Government which previously had 19 BPRs, 7 of which are jointly owned by the Provincial Government of West Java, have merged some time ago, so that currently 12 BPRs have joined to become PD BPR Babakan, while 7 other BPRs joined to become PD BPR Astanajapura.
OJK highly appreciates the Cirebon Regent's strategic move in combining regional government-owned BPRs in Cirebon Regency because it is believed to have a positive impact on BPRs in responding to various challenges faced, especially capital, human resources, information technology, products and services as well as competition with other financial service institutions. Both BPRs as a result of the merger are also expected to be able to develop business while contributing to the economy, especially in the Cirebon District region as well as for increasing local revenue.
For Cirebon region, BPR's total assets increased by 13.50% to Rp2.98 trillion, while Third Party Funds and loans each increased by 14.30% to Rp2 trillion and 15.14% to Rp2.34 trillion. (LM)