OJK Chairman Mahendra Siregar: Fundraising In The Capital Market Reaches Rp123.5 Trillion As Of July 26, 2022

Chairman of the Board of Commissioners of the Financial Services Authority (OJK) Mahendra Siregar. (Photo: Doc. Antara)

JAKARTA - Chairman of the Board of Commissioners of the Financial Services Authority (OJK) Mahendra Siregar said that fundraising in the capital market reached Rp123.5 trillion as of July 26, 2022.

"As of July 26, 2022, it will reach Rp. 123.5 trillion with the addition of 32 new issuers," he said in a press conference on the results of the 2022 Financial System Stability Committee (KSSK) Third Periodic Meeting, quoted from Antara, Monday, August 1.

OJK noted that the stock market performance was able to strengthen by 5.7 percent (ytd) to a level of 6,898.22 as of 27 July 2022 and was included in the stock exchange that had the best performance in the region.

This was supported by a net by of non-residents in the stock market of Rp. 58.29 trillion in the midst of global financial market turmoil. However, Mahendra emphasized that the pressure on global financial markets has also begun to have an impact on the domestic stock market as seen from the increased volatility in the domestic stock market.

"Although year-to-date non-residents still recorded an inflow of Rp. 58.29 trillion, from May to July 27, 2022, they recorded a net sale of Rp. 13.88 trillion, which is in line with outflows from other emerging economies," said Mahendra.

Based on the KSSK meeting on Friday, 29 July, he continued, financial system stability and financial services sector performance were relatively well maintained with intermediation of financial services institutions growing in line with the performance of the national economy.

"Banking credit in the second quarter of this year grew by 10.66 percent (yoy) as of June 2022," he said.

This growth was supported by corporate credit growth of 12.87 percent. Meanwhile, Third Party Funds (DPK) grew by 9.13 percent (yoy) amid a 19.57 percent growth in current accounts and 12.31 percent savings.

In line with the performance of banking intermediation, financing distribution also continued a positive trend with growth of 5.63 percent (yoy) as of June 2022, supported by financing, especially investment and working capital, which grew by 19.6 percent and 18.8 percent, respectively.

"The insurance industry has succeeded in increasing premium collection to IDR 27.8 trillion in June 2022, with life insurance premiums reaching IDR 15.2 trillion and general insurance reaching IDR 12.6 trillion," he explained.

Mahendra also conveyed that credit risk was maintained both in the banking industry and in financing supported by adequate liquidity and strong capital.

It was recorded that the gross NPL of banking as of June 2022 fell to 2.86 percent, while the NPF ratio of finance companies was at the level of 2.81 percent. Meanwhile, banking liquidity is adequate with the ratio of liquid assets to non-core deposits at the level of 133.35 percent and liquid assets to deposits at the level of 29.99 percent as of June 2022.

Furthermore, the financial services industry's capital resilience is also adequate with banking CAR reaching 24.69 percent which is also in line with the strong capitalization of the life insurance and general insurance industries with risk-based capital at 481.01 percent and 318.24 percent, respectively. Likewise, the gearing ratio of finance companies is 1.98 times.

"In order to maintain financial system stability in the midst of increasing external risks, OJK will be more proactive in strengthening prudential policies in the financial services sector in maintaining the stability of the financial services industry," said Mahendra.