Bank Indonesia and the Corruption Eradication Commission (KPK) have signed a memorandum of understanding (MoU) to improve cooperation in the prevention and tackling of corruption in the banking sector.
The MoU, signed by BI Governor Burhanuddin Abdullah and KPK director Taufiequrachman Ruki, envisages the establishment of an integrated "bank-customer information assessment center", as well as programs to improve the capacity of personnel in the two institutions in handling banking-sector corruption cases.
"We expect that the effort to eradicate corruption will become more effective from now on, while at the same time avoiding negative excesses," Burhanuddin said.
"Fighting corruption should help the economy and growth, instead of hampering them."
Burhanuddin's words are in contrast to recent remarks by Vice President Jusuf Kalla, who said the anticorruption drive had led to reluctance among public officials about making decisions, especially over procurements.
He claimed that many executives of state-owned banks were reticent about extending project loans out of fear of later being accused of corruption. Similarly, he argued, many managers of state-financed projects were also afraid to make spending decisions, to the detriment of economic growth.
For his part, Burhanuddin said that many of the controversies affecting the banking industry were not necessarily indications of graft. Therefore, he said that he hoped better coordination and cooperation between BI and the KPK should help straighten out possible misunderstandings.
Burhanuddin further said that BI had itself been active in promoting transparency and accountability within the banking sector, requiring lenders to implement such principles as "Know Your Customer", good corporate governance and proper selection tests for bank managers and owners.
BI previously signed MoUs with the Attorney General's Office (AGO), the National Police and the country's anti-money laundering watchdog, the Financial Transactions Reporting and Analysis Center (PPATK), with a view to preventing banking sector crimes. Meanwhile, the KPK recently signed an MoU with the PPATK.
Commenting on BI's hopes that the latest MoU would help clean up the banking sector, Bank Negara Indonesia president Sigit Pramono, who also attended the event, said that the anti-graft drive had created problems for many bank executives due to its "shock-therapy" nature.
"Of course, there will be some adverse effects, but we cannot simply say that there has been less lending as a result," said Sigit, who also chairs the National Banks Association (Perbanas).
"In addition, there are problems in the real sector hampering higher credit growth."
BI figures show that total bank lending amounted to Rp 66 trillion as of October, representing an increase of only 8 percent compared to the same period last year -- much lower than the 13-15 percent target.
A slowdown in economic growth this year -- rather than the antigraft drive -- is seen by most objective commentators as being the main reason for the disappointing loan growth, with high inflation and interest rates curbing consumer demand and spending, and borrowing demand from companies.
http://www.thejakartapost.com/detailbusiness.asp?fileid=20061209.L01&irec=0
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