Publications| » | The Effects of Banking Deregulation on the Indonesian Banking Sector | | | Category: Working Papers | | | Suminto , S.Sos., M.Sc. (Economist), 2006-08-04 22:09:25 | | | | | | Facing economic trouble due to the worsening price of oil and worldwide recession in the early 1980s, Indonesian government introduced and implemented banking deregulation. The results of these policies were impressive. Financial institutions developed rapidly. We can note the greater access to banking sector due to increasing the number of banks and branches, increasing bank lending, developing the size of financial sector, maturity structure that beneficial for corporate sector, and better efficiency of banking sector. However, unfortunately, these impressive results were not accompanied by good governance, both internal governance and external governance. These governance failures not only undermined the good results of deregulation, but also built up financial vulnerabilities. In the next step, these financial vulnerabilities significantly contributed to the Indonesian financial crisis. | | | |
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The Effects of Banking Deregulation on the Indonesian Banking Sector.pdf |
