LPS Supports BPR For IPO So That Its Management Is More Transparent
Member of the Board of Commissioners for the Deposit and Resolution Guarantee Program of the Bank of the Deposit Insurance Corporation (LPS) Didik Madiyono. (Photo: Doc. Antara)

JAKARTA - Member of the Board of Commissioners for the Savings and Resolution Guarantee Program of the Bank of the Deposit Insurance Corporation (LPS) Didik Madiyono stated that he supports people's credit banks (BPR) going public or holding an initial public offering so that their management is more transparent.

"We are very supportive because the more BPR is included in the stock exchange, the more supervision. The investors are monitoring, there are obligations for information disclosure so that BPR will be managed more responsibly, accountable, and transparently," said Didik in Jakarta, quoted from Antara, Thursday, February 29.

The more BPRs are listed on the stock exchange, said Didik, the more LPS welcomes them. Moreover, BPRs that enter the stock exchange must of course meet the strict requirements set by the Financial Services Authority (OJK).

"Of course it will be selected, not all BPRs can enter the stock exchange. Just like not all companies can enter the stock exchange. BPRs that enter the stock exchange will of course be selected (based on the criteria) which are good, managed properly, healthy," he said.

With the entry of BPR in the stock exchange, Didik also reminded a number of challenges that must be faced by BPR starting from making improvements to bank financial performance, improving risk management, to improving management governance.

In accordance with the mandate of Law Number 4 of 2023 concerning the Development and Regulation of the Financial Sector (UU P2SK), BPR is not too much different from commercial banks.

The P2SK Law allows BPR to conduct public offerings on the stock exchange. This aims to support strengthening BPR capital so that it is more competitive. However, BPRs that can conduct public offerings must meet certain requirements and criteria.

Previously, OJK Banking Supervision Chief Executive Dian Ediana Rae said that BPR must really be prepared to hold a new mandate in accordance with the P2SK Law as well as possible. Thus, efforts to strengthen BPR must also be carried out in all aspects.

OJK also continues to make efforts to strengthen and consolidate BPR through various strategies. In connection with the increasing risk in BPR due to product innovation developments and unsuitable practices (fraud), OJK strengthens the implementation of governance in BPR operations.

In the near future, the OJK will also launch a roadmap for the Development of the BPR and BPRS Industry 2021-2025 which aims to strengthen BPR governance. The roadmap was launched as a series of several regulations that have been issued in 2023 and will continue with the issuance of new rules this year.

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