JAKARTA (TheInsiderStories) - Bank Indonesia (BI) relaxed the minimum reserve requirements rules to allow banks some flexibility to improve liquidity and reducing volatility in the overnight money market. The Completion is a further step of reformulating the monetary policy operational framework set out earlier last year.
The amendment to these arrangements shall be set in BI Regulation No.19/6/PBI/2017 concerning the Fifth Amendment to BI Regulation No. 15/15/PBI/2013 concerning minimum reserve requirement for commercial banks in Rupiah and foreign currency for commercial banks. The main point is related to the fulfillment of the primary statutory reserves in Rupiah.
Primary reserves requirement in Rupiah previously set at 6.5 percent of third party funds in Rupiah and fulfillment is made daily will adjusted to statutory reserves that must be met daily by 5 percent of third party funds in Rupiah starting July 1,2017 with a transitional period of one month. The statutory reserves are met on an average of 1.5 percent of deposits in Rupiah for a certain period.