JAKARTA – The dissolution of Silicon Valley Bank (SVB) and Signature Bank in the United States of America (US) is confirmed not directly affecting Indonesian banking climate.

Dian Ediana Rae, Executive Chief of Banking Supervision of the Financial Services Authority (OJK), reaffirmed that the winding down of SVB will not directly affect Indonesian banking setting, especially when any aspects of it is not related to any business unit, facility line, or investment on securities of SVB. “OJK hopes the public and the industry will not respond to any emerging speculation among the masses,” he confirmed in a press release quoted Tuesday (14/3).

Ediana Rae revealed that the liquidity of Indonesia’s banks is currently under control, as seen in the ratio of liquid assets to non-core deposit (LA/NCD) of 129.64% and liquid assets to third-party funds (AL/DPK) of 29.13%. They are way above the threshold of 50% and 10%.

Furthermore, banks’ assets are also proportional to third-party funds, meaning that current account and saving account (CASA) rises along with those assets. Therefore, the balance is well-maintained and is less sensitive towards interest rate shift.

Ediana Rae mentioned that OJK will collaborate and synergise with Bank Indonesia (BI), the Ministry of Finance, as well as the Indonesia Deposit Insurance Company through its Financial System Stability Forum, to anticipate any potential global impact induced by the crisis in the US. (LK/ZH)