KPEI Reveals Total CPP PuvA Transactions Reach 168 Million US Dollars Until October 2024

President Director of PT Kliring Penjaminan Efek Indonesia (KPEI) Iding Pardi (center). (Photo: Aris Nurjani)

JAKARTA PT Kliring Penjaminan Efek Indonesia (KPEI) sebagai CCP PuvA telah resmi beroperasi sejak 30 September 2024 dan telah mencatatkan total nilai transaksi sampai dengan akhir Oktober 2024 sebesar 168 juta dolar Amerika Serikat (AS) dengan jumlah transaksi sebanyak 118.

KPEI President Director Iding Pardi conveyed that the existence of KPEI as CCP was proven to be able to make transaction settlements more efficient by recording netting efficiency of 33 percent.

"The establishment of the PUVA CCP aims to answer the market's need for a safe, standardized and transparent completion system," he said at a press conference, Monday, November 25.

Iding said that CCP Puva is able to reduce the complexity of interconnectivity between market participants, so that systemic risks due to settlement failure can be minimized.

In addition, Iding conveyed that the existence of CCP Puva is expected to increase market confidence, encourage liquidity, and more dynamic trading activities.

Iding conveyed that KPEI, as the CCP PuvA in Indonesia, is committed to providing reliable CCP services, which include providing clearing services and guaranteeing transaction settlements, risk management, collateral management, and supervision of the PuvA transaction market.

"KPEI is ready to carry out its vital role to ensure smooth and transaction security in order to create an efficient and stable market ecosystem," he said.

Currently, there are eight clustering member banks that are also shareholders who have transacted, namely PT Bank Mandiri (Persero) Tbk, PT Bank Negara Indonesia (Persero) Tbk, PT Bank Rakyat Indonesia (Persero) Tbk, PT Bank Central Asia Tbk, PT Bank Permata Tbk, PT Bank Maybank Indonesia Tbk. PT Bank CIMB Niaga Tbk, and PT Bank Danamon Indonesia Tbk.

Iding said, KPEI will strive to increase the number of participants who are members of Clearing so that transactions are more efficient and attractive.

He invited banks in Indonesia to immediately join and become part of this strategic implementation.

As a form of effort to introduce PUVA's CCP service, Iding said that his party is conducting socialization to market participants, including foreign exchange banks and associations, regarding the benefits and mechanisms of CCP Puva.

Iding hopes that more banks will participate as clearing members to support strengthening national financial market infrastructure.

"By joining as a CCP member, banks can enjoy benefits such as reducing credit risk between parties, operational efficiency, and better liquidity management," he said.

In addition to increasing the number of Clearing Members, Iding said that his party will also carry out developments related to products that can be screened.

Currently, the PuvA product that can be screened by KPEI is Domestic Non-Delivereable Forward (DNDF), which is a foreign exchange derivative transaction against the rupiah in the form of a forward contract with a fixed mechanism carried out in the domestic market.

In the future, Iding said that the products that were screened would increase along with the development to be carried out, including clearing of the Repo Interbank, Interest Rate Swap (IRS) and Overnight Index Swap (OIS).

In terms of regulation and best practice, KPEI, which has now received Qualifying CCP (QCCP) recognition from Bank Indonesia, in the future will increase credibility as CCP Puva by always meeting PFMI standards and filing Qualifying CCP from other international jurisdiction institutions.

This step aims to ensure that PUVA transactions in Indonesia meet global standards in terms of stability, efficiency, and reliability.

As CCP PuvA, KPEI is committed to increasing transparency, efficiency, and systemic risk mitigation in the money market and foreign exchange markets.

This step is expected to be a catalyst for the creation of a safer, deep, and more competitive Indonesian financial market at the global level.