Mega proposes familiar figures for BI senior post
Dadan Wijaksana, The Jakarta Post, Jakarta
President Megawati Soekarnoputri's move to propose names from within the central bank as candidates for the post of senior deputy governor reflects the government's desire to pick someone who is already familiar with Bank Indonesia's working environment, system and culture, according to experts.
Someone from within the organization would adapt to the post quickly, which would be helpful as the central bank braces itself to face major challenges clouding the banking sector, experts said on Thursday.
"While outsiders should not be disregarded, the selection of these candidates I think is good, as they already know the system, rhythm, and culture of the bank. This is good so as not to create shocks to the system," said Paskah Suzetta, deputy chairman of the House of Representatives Commission IX on financial affairs.
Raden Pardede, director of Danareksa Research Institute, also expressed little objection to the nomination. "The fact that they are all from within the organization means that they will not have problems in coordination. They can get right down to it."
Megawati submitted to the House of Representatives a list of three candidates for Bank Indonesia senior deputy governor post on Wednesday, currently occupied by Anwar Nasution, who's term ends on July 17.
The three are all career officers. They are Miranda S. Goeltom, former Bank Indonesia deputy governor; Hartadi A. Sarwono, central bank deputy governor; and Budi Rochyadi, head of the central bank's representative office in Tokyo.
Miranda last year was defeated in the race for the post of central bank governor.
Under Bank Indonesia Law, the House, through Commission IX on financial affairs, has three weeks to accept or reject the candidates. In case the House rejects the first batch of candidates, the President will have to submit a new list.
If the commission rejects the nomination for the second time, then the President -- with the House's approval -- will reappoint either the incumbent, or one of the lower-ranking members of the bank's board of governors.
Currently, Bank Indonesia's board of governors consists of one governor, one senior deputy governor and four deputy governors.
Dradjad Wibowo, of the Institute for the Development of Economics and Finance (Indef), has said that strong coordination was one of the main prerequisites for the central bank to gain confidence from the banking sector as it enters a critical period.
He was referring to major changes in the industry; the restructuring of the banking sector based on the newly released Indonesian Banking Landscape, and the plans to establish a Deposit Insurance Agency (LPS) and Financial Services Authority (LOJK).
The landscape is a blueprint for the banking sector to be implemented in stages over the next 10 years. Under the landscape, the minimum capital requirement will be raised in the next seven years from the current Rp 10 billion (about US$1.2 million) to Rp 100 billion -- a massive move as it could lead to more bank mergers.
Elsewhere, Paskah added that in the near future the commission will invite various parties -- including banking experts, industry players and academics -- to deliver their views on the current selection process.