No bank liquidation

Central bank (BI) governor, Syahril Sabirin, has assured that there will be no bank liquidation, at least for this year -- a comforting statement amid reports that many banks have failed to meet the capital adequacy ratio requirement of 8 percent.

For the time being, the nation is free from panic and the other psychological effects of bank liquidation. The government can also save on huge funds needed for such measures.

However, such comfort would only be temporary; there is no guarantee that no bank will be liquidated next year. This would happen if bank owners do not seriously consolidate their banks. The government and the central bank should try harder in encouraging bank consolidation. A forced bank merger could work out.

Take the "forced marriage" of Bank Mandiri and Bank Danamon, the two banks now living as a happy family although they have been forced to adapt to a new environment.

Other "single" banks should not hesitate in seeking strategic partners for mergers. The key lies in the good will of stakeholders.

-- Bisnis Indonesia, Jakarta