BCBS rates high grades for Indonesia banking performance

BCBS( basel committee on banking supervision) last november gave incredible grade in the assessment program consistency regulation(RCAP) each value of compliant (C) for liquidity coverage ratio(LCR) and largely compliant(LC) for RCAP capital. This is the highest grade given for the category especially compliant grade for  LCR and the second the highest grading LC for RCAP capital category.

Based on this achievement, Indonesia itself prefers to focus on two important points to preserve the incredible reputation of its banking performance,

First, imposition of zero percen risk for government bond dominated in foreign currency while based on basel framework, such exposure is subject to country rating which is 50%.

Second, imposition of risk weight for receivable from employees and retirees with a risk of weight 50%  while based on basel framework is subject to risk weight 75% with a consideration that the bill is a guaranteed bill thus its risk is lower than other bill.

The achivement of indonesia through the grading given by basel is such along process, particularly since 2014 the country struggles to adjust the basel framework with the local regulation. The great reputation of indonesia bank throuh RCAP which is participated by 28 countries provides easiness for the country to pierce its service into international level. Furthermore, it will increase the trust of investor toward the bank and other business instruments.