Bankers seek preferential treatment

Bankers seek preferential treatment

NUSA DUA, Bali (JP): Southeast Asian bankers are asking for
preferential treatment from their governments to enable them to
benefit from the growth of financial services in the region.

The call was one of the resolutions adopted by the Association
of ASEAN Bankers at the conclusion of its three-day meeting
yesterday.

Tay Kah Chye, the secretary-general of the association, said
that preferential treatment was essential to give regional banks
additional strength prior to the liberalization of the banking
industry.

He said that regional banks should, for example, be given
priority in financing infrastructure projects in each of the
ASEAN countries. The Association of Southeast Asian Nations
(ASEAN) is comprised of Brunei, Indonesia, Malaysia, the
Philippines, Thailand and Singapore.

To the same end, he said, the governments of ASEAN countries
should also give wider access to the banks of other member-
countries to enter the banking industry in their own countries.

"Such an arrangement is important to enable the regional banks
to compete with those from the developed nations in the
globalization era," Tay told a press briefing at the end of the
annual meeting.

The bankers' council, which also discussed cooperation
programs approved at its meeting in Cebu, the Philippines, last
year, failed, however, to achieve a consensus on a common
strategic alliance in facing the globalization of financial
services in the coming years.

"It is up to each bank on how to formulate its strategy in
responding to the globalization trend," said Tay, who was
accompanied by Iwan R. Prawiranata, the chairman of the
federation of Indonesian banks' associations and Salahuddin N.
Kaoy, the president of the state-owned Bank Ekspor Impor
Indonesia.

Resolutions

He said that the meeting's resolutions on the promotion of
bilateral cooperation in fields such as treasury and
correspondent banking would be strong enough to enable the banks
to meet global competition.

"If the intra-ASEAN trade financing is all handled by regional
banks, rather than those from outside ASEAN, the domestic banks
will still be able to survive even in the liberalized market," he
said.

The association will organize next year a number of workshops
on the correspondent and treasury systems in each ASEAN member
country, Iwan said.

In addition to the call for preferential treatment and the
promotion of treasury and correspondent banking, the meeting also
endorsed the appointment of Wong Nang Jang, the chief of the
Association of Banks in Singapore, as the chairman of the ASEAN
Bankers' Association and its council for the 1995-1997 period,
replacing Rafael B. Buenaventura of the Philippines.

Indonesia's Minister of Finance Mar'ie Muhammad said he shared
the concerns of the bankers about the negative impact of the
liberalization of financial services, which are now being
negotiated within the framework of the World Trade Organization.

In his speech, which was delivered by Director General for
Financial Institutions Bambang Subianto, the minister urged the
ASEAN financial community to take the steps necessary in facing
the globalization of financial services.

"On the basis of the spirit of ASEAN and in line with the
multilateral commitment, cooperation among ASEAN bankers is a
must," he added.

He said that Indonesia's banking industry had been gradually
reformed to meet to stimulate the growth of business activity
and, at the same time, to improve the country's economic
resilience against the impact of global economic and monetary
developments. (hen)