OJK Board Inauguration: Masterplan and Expectations

Updated: Jul 29



The new Board of Commissioners of the Financial Services Authority (OJK) was officially sworn into office on Wednesday (7/20). The Supreme Court Chief Justice, H. M. Syarifuddin, took the oath and inaugurated the Chair and Members of the OJK Board of Commissioners for the 2022-2027 period at the Supreme Court Building. The board was initially appointed by Commission VI of the Indonesian House of Representatives (DPR) back in April 2022. The inauguration and swearing-in were carried out in a hybrid manner and were attended by several heads of ministries and state institutions and the previous serving board. As a result, there are seven new members of the board, namely Mahendra Siregar as Chairman, Mirza Adityaswara as Deputy Chairman, Inarno Djajadi as Chief Executive of the Capital Market Supervision, Sophia Issabella Wattimena as Chairman of the Audit Board, Friderica Widyasari Dewi as member in charge of Consumer Education and Protection, Dian Ediana Rae as Chief Executive of Banking Supervision, and Ogi Prastomiyono as Chief Executive of the Non-Bank Financial Industry (IKNB). Furthermore, Doni Primanto Joeno is an Ex-officio member representative of Bank Indonesia, and Suahasil Nazara is an Ex-officio member representative of the Ministry of Finance. This inauguration is in line with the issuance of Presidential Decree No. 51/P/2022 concerning the dismissal and appointment of the OJK Board of Commissioners. These seven new board members will conduct their duties as commissioners in OJK according to OJK Law No. 21/2011.


According to financial industry participants, the seven new OJK members have many responsibilities that must be carried out and duties that need to be done. Chandra Pasaribu, Head of Research at Yuanta Sekuritas, stated that OJK must provide more profound protection and broader oversight in the financial industry, particularly concerning the capital market and non-bank financial institutions. According to Chandra, OJK should also provide the public with thorough and understandable investing knowledge so that individuals become entirely aware of the investment risks is one of several additional jobs. Lastly, OJK must be clear on several issues, including businesses that delist on the stock market, customer rights and protection in emerging areas like fintech, and investments made under BAPPEBTI, including Cryptocurrencies and foreign markets, added Chandra. Head of Research at Aldiracita Sekuritas, Agus Pramono, stated that harmful market manipulation doings such as pump and dump schemes are usually conducted by social media influencers to be intensely regulated. The public also expects the new board to strengthen integrated regulation, supervision, and resolving current issues across the industry. For instance, before the inauguration, insurance clients of PT AIA Financial, PT AXA Mandiri Financial Services, and PT Prudential Life Assurance protests were staged. According to the protest coordinator, Maria Trihartati, this action was caused by unfair treatment by insurance companies in settling complaints of their clients. This protest intends to push the new OJK management to conclude this case's certainty.


The newly elected chairman of the OJK, Mahendra Siregar, has disclosed a 100-day action plan for the first two years of board tenure. In the first year, OJK will focus on capabilities and human resources for the core of the supervisory function by revamping the organizational structure, as he said during the Commission XI DPR in April 2022. Mahendra will compile a roadmap and priorities for the OJK and a roadmap for the non-bank financial industry (IKNB) because of its urgency to be completed. The first year also targets implementing a single licensing window, ratification, and approval and encouraging regulatory clarity, especially on POJK. Furthermore, for the first two years, he targeted implementing the IKNB solvency framework and redesigning the OJK business processes, from licensing to supervision. Finally, he intends to increase OJK innovation by capitalizing on technical advancements and expanding them. Minister of Finance, Sri Mulyani Indrawati, expects that OJK, the regulatory and supervisory authority for the financial sector, would improve consumer literacy, develop MSMEs, minimize risks, and strengthen the capital market's role. In addition, she expects that OJK will be able to construct an insurance business that can strike a balance between industrial development and consumer protection, as well as create an efficient, active, and liquid financial market. This ex-officio combination from the Ministry of Finance is anticipated to promote a transformation process that balances sustainability and good results. Coordination of fiscal and monetary policies, backed by efficient regulation and oversight of the financial sector, will be the key to addressing the challenges of global dynamics.


Sources:

CNBC Indonesia

Detik Finance

Kementerian Keuangan


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