October 2015 4th Week

02 november 2015

Categories : IR Weekly Review


  • MACRO
      • The monthly meeting of the FOMC for 2 days (27-28 October 2015), again decided not to raise interest rates the central bank of the United States and still maintain the level of interest rates at 0 percent. But the Fed gave assurance plan rate hikes this year will remain so, and December is the time given the central bank. Later, the US central bank will see the development of inflation and growth data of non-farm payroll (NFP) ahead of the meeting until the end of the year. In addition, the risk of the global economy is still monitored by the Fed. Janet Yellen of the Fed leadership has repeatedly asserted that the rise in interest rates is a decision "right" this year and will certainly be done, but in recent months the global economy has shown signs of strain which also affect the economy in the United States. Moreover, domestic inflation is still far below the target of 2% inflation was last approaching the level of 0 percent which made the US central bank is in no hurry to raise interest rates. Although the job market continues to improve gradually and wages start to rise and make the American economy is not in danger in the near future. And in the meeting of policy makers signaled that a rate hike is still possible in the 'next meeting is in December. This decision is counter to the decision of some global central bank that it has and will reduce interest rates as the PBOC and the ECB.
      • People’s Bank of China (PBOC) writes on its website today that the steps taken at the end of last week is normal and expected to push consumer prices and a drop in foreign exchange reserves because of the exchange rate. "Inflation cools in September means that a corresponding reduction in nominal interest rates are needed to encourage real interest back to a reasonable level, allowing the cost of financing the social fall further and strengthen the economy," said the PBOC in a statement, as quoted by CNBC, Monday ( 10.26.2015). Last month, the consumer price index (CPI) of China rose 1.6% from a year earlier, but down from an estimate of 1.8% and the previous month by 2%. On the other hand, the producer price index (PPI) fell 5.9% in September, during the 43-month losing streak. "In recent months, the total funds outstanding foreign exchange reserves fell because of the exchange rate. Although the foreign exchange market has been relatively stable, uncertainty persists. Because of the reduced bank reserve requirements will add more liquidity to the banking system," the central bank said. Reduction of reserve requirement will not improve its balance sheet. Thus, measures of quantitative easing or a new stimulus differs significantly from the quantitative easing measures undertaken by other central banks. An increase in the central bank balance sheet is done by purchasing a number of specific assets, such as bonds. PBOC said China does not face the limitations of zero interest rates as the European Central Bank and the Fed because nominal interest rates remained above zero, while the deposit reserve ratio is still relatively high. Thus, China has the flexibility to use conventional monetary policy.
      • Reviews :
        The increase in the Fed's benchmark interest rate would make the dollar stronger. It's also dangerous for America, because of the stronger dollar would make US products become more expensive in export markets. The result of such products become less competitive when competing with similar products from Asian countries that the value of its currency lower.
  • MICRO
      • Chairman of the Board of Commissioners FSA Muliaman D Hadad, said the master plan for the financial services sector in the middle of the stacking Indonesia 2015-2019. "We are ready to carry out the task of supervision of the financial sector, from banking, insurance, capital markets and others," Muliaman said, Thursday (29/10/2015). Masterplan which was planned to be completed before the end of 2015, will contain detailed supervision of the financial sector. There are three main pillars that set the contribution, stability and financial inclusion. "Contributions to direct optimization of the FSA's role in supporting the acceleration of economic growth and increased prosperity," As concerns the stability, leading to efforts to create the financial system as a foundation for sustainable development. "While financial inclusion is directed to achieve financial independence and to support community efforts to increase equitable development," he said. According to Muliaman, the FSA supervision of the financial services sector in Indonesia, will be different from the previous institution supervision conducted. "Once there are FSA, different supervision is more integrated, both the parent and subsidiary controlled in an integrated manner," he explained. In this case, said Muliaman, the FSA will carry out supervision of the parent and its subsidiaries. "The parent company shall also be responsible or bear the risk of its subsidiaries. This will avoid the practice of financial services companies enter into a gray area that is separated from supervision," Muliaman said.
      • Indonesia Stock Exchange (IDX) aiming for a million investors in the next three to four years from the current position of approximately 400,000 capital market investors. IDX president director Tito Sulistio argues, it also will increase the number of investors who actively trade in the next year. "Not only the number of investors who would be increased. Investors 25,000 currently active, we will add another 20,000, so about 50,000 active investors per day," he said in the Stock Exchange Building, Jakarta, Wednesday (10/28/2015). Tito said that, in order to achieve the target of an active investor transactions, BEI will continue to campaign to educate people. "We will do the educational campaign, there will be investors summit, nearly 80 issuers want to come, previously only 30 issuers. Then there will be a 40-50 expose media for activating investment and securities investors who have not been active," he explained. In addition, the bank will add a new data center because there is no additional four years ago. Targeted amount to 7.5 million frequency. "Upgrading the system frequency was 2.5 million, which we recently added the ability to be 7.5 million to respond, to accommodate the increase in frequency that will happen next year," he concluded.
      • Reviews :
        The benefits that can be gained when it became a company that went public through IPO such as: Acquire new funding sources, providing a competitive advantage for business development, mergers or acquisitions of other companies with financing through the issuance of new shares, increasing the ability of going concern, enhance corporate image and enhance shareholder value.
  • BANKING
      • Bank Indonesia (BI) offers four concrete steps to explore its potential as a source of financing Islamic financial economy. The fourth step is the regulatory and policy support. Second, provide education and socialization, especially to banks and businesses. Third, providing new scheme funding model and the latter is the launch of zakat and waqf. BI deputy governor, Perry Warjiyo, revealed that one of the measures provided are increased knowledge of economics and Islamic finance for banks, businesses and the financial sector. "Education Islamic financial is intended that employers know the various types of products and the best schemes owned Islamic banking. Both sides of the collection, and disbursement of funds," Perry said in a seminar titled "Education of Islamic Finance for Entrepreneurs" in Surabaya, Wednesday, October 28, 2015. Given this educational, Perry expects to increase understanding and interest employers to Islamic financial schemes.
      • President Director of PT Bank Rakyat Indonesia (Persero) Asmawi Syam said the four banks state-owned enterprises (SOEs) has acquired a telecom operator to realize the unification of ATM SOEs. Four red plate banks, including PT Bank Rakyat Indonesia (Persero), PT Bank Negara Indonesia (Persero), PT Bank BTN (Persero) and PT Bank Mandiri (Persero). He said, the company agreed to acquire a provider of telecommunications services (service provider) in the middle of this month. "We agreed on October 21, 2015, we acquired an existing service provider," he said at the Ministry of SOEs, Jakarta, Monday (10/26/2015). However, it is still in the stage of negotiations with the service provider. The reason, the company has not yet decided whether to sell a majority stake to the company. "The question arises, what they want or majority shareholder. This is again in negotiations. Technically, our majority wants to make it more efficient," he added. Asmawi said, to realize the desire to acquire a majority stake in the company's service provider, it pointed to the bank to become a consultant. "On 21 (October) we MoU four banks, Bank Mandiri we point to look for in a consultant to do this. We hope will be completed soon," said Asmawi. In addition, the acquisition must be pocketed approval of Bank Indonesia (BI). Because, it is included in the corporate action. "Need permission BI as well. Because this is the corporate action. Four banks has also the IPO," he said.
      • Reviews :
        The merger of four state-owned bank ATM, Bank Mandiri, BRI, BNI and BTN, then the consumer will be facilitated in conducting financial transactions. Besides the benefits to the state-owned bank will increase the efficiency of operational costs, network investment and increase fee income base.

Disclaimer : This document is for informational purposes only and obtained from a variety of reliable sources, but is not a guarantee the accuracy or completeness and should not be relied on completely. The above conditions may be changed at any time. Forbidden to rewrite anything without written permission from The East Java Regional Development Banks