The Boom, Bust and Restructuring of Indonesian Banks

 
Author/Editor: Pangestu, Mari ; Habir, Manggi
 
Publication Date: April 01, 2002
 
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Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: This paper studies why currency and monetary shock hit Indonesia's economy and banking sector so severely and the measures that were taken to deal with the banking crisis, the lessons learned, and challenges faced in restructuring and strengthening the banking system. The vulnerable state of the banking sector, in combination with exchange rate and interest rate shocks, led to a systemic banking crisis. The priorities for bank restructuring are to complete the separation of nonviable from viable banks, recoup losses, implement new rules and regulations, and develop an incentive-based system for the consolidation of banks.
 
Series: Working Paper No. 02/66
Subject(s): Financial crisis | Indonesia | Bank reforms | Bank restructuring

Author's Keyword(s): Indonesia | Asian financial crisis | banking reforms
 
English
Publication Date: April 01, 2002
ISBN/ISSN: 1934-7073 Format: Paper
Stock No: WPIEA0662002 Pages: 35
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