Choosing a bank in a crisis<\/p>\n
By Taufik<\/p>\n
Ten years after the New Order government launched Pakto 1988
\n(October Package 1988), the country's banking sector is in its
\ngloomiest era. Not only have the country's state and private
\nbanks suffered huge monetary losses, but they have also lost
\ncredibility with their clients. For example, Bank Central Asia
\n(BCA) was affected by a major bank run, which led to the bank
\nbeing made a nationalized bank (BTO). Also taken over was private
\nbank Danamon Bank, while other big private banks such as BDNI and
\nBank Umum Nasional were closed by the government.<\/p>\n
Like the private banks, state banks also suffered huge losses
\nas a result of a prolonged economic crisis, which started in the
\nmiddle of 1997. But due to their ownership status, the state
\nbanks did not have to suffer any \"adjustment\" to maintain their
\nexistence. The crisis of confidence faced by private banks
\nappeared to be a blessing in disguise for state banks, with a
\nlarge number of depositors shifting their money from private
\nbanks to state banks.<\/p>\n
International banks also enjoyed benefits from the crisis of
\nconfidence affecting private banks. They have become the new
\ntargets of Indonesian depositors. What is interesting is that the
\ninternational banks have taken advantage of the phenomenon by
\nlaunching aggressive promotion campaigns.<\/p>\n
This condition was a contradiction to the phenomenon which
\nhappened not long after the government launched Pakto 1988. At
\nthat time, both state and international banks were left
\npowerless, as if they were only spectators watching the country's
\nprivate banks move aggressively to expand their business. As a
\nresult, the private banks managed to become dominant players in
\nthe Indonesian banking market in less than 10 years.<\/p>\n
The phenomenon affecting banking over the past two years
\nclearly raised a big question about the fate of the country's
\nprivate banking sector. Especially, have customers really
\nforsaken domestic banks? A survey held recently on 926 bank
\ncustomers, from various socioeconomic strata in 10 big cities on
\nthree of Indonesia's main islands, shows that state banks
\ndominate the top five positions for brand awareness. Three of the
\nfive favorite banks were state banks while the remaining two were
\ndomestic private banks. Interestingly, one of the domestic
\nprivate banks, BCA, has become a state bank. The big five were
\nBCA, BNI 46, BRI, BTN and Bank Bali.<\/p>\n
The survey's result, actually, was not contradictory to the
\nphenomenon affecting banking lately. Undoubtedly, state banks are
\nmuch more popular (more truthful) than private banks in this time
\nof crisis, even though the government has guaranteed the safety
\nof customers' funds deposited both in state and private banks.
\nHowever, the fact that BCA topped the rank, with a large
\nproportion, reflects that customers in Indonesia make their
\nchoice of bank very carefully. They do not only take into account
\nthe status of the shareholders but also the advantages offered by
\nthe banks. Nowadays, the reasons for deciding into which bank to
\ndeposit funds are not only safety and good returns but also, more
\nimportantly, to get support in handling various routine
\ntransactions.<\/p>\n
For example, this is the reason why people prefer BCA to BNI
\n46. BCA can give more services related to the routine household
\ndemands of Indonesian depositors than BNI 46. In addition, BCA,
\nwith its new BTO status, is no longer different from BNI 46. They
\nboth belong to the state.<\/p>\n
It is clear, however, that being a state bank has become a
\ngreat selling point. That is why Bank Bali, which provides
\nsimilar services to its customers, took fifth position in the
\nrank. Because its service network, mainly its branch offices or
\ntreasury offices, is much smaller than that of BNI 46, BRI and
\nBTN. And especially, the last bank, BTN, has taken advantage of
\nthe network of PT Pos Indonesia. In other words, besides
\nownership status, the vast network owned by the concerned banks
\nplays an important role.<\/p>",
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"sponsor": "Okusi Associates",
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