Silalahi, Tumpak
Bank Indonesia

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THE MARKET STRUCTURE OF THE BANK, ITS PERFORMANCE, AND THE MACROPRUDENTIAL POLICY Silalahi, Tumpak; Manurung, Adler H; Hidayat, Yuli Teguh
Buletin Ekonomi Moneter dan Perbankan Vol 18 No 1 (2015): JULY 2015
Publisher : Bank Indonesia

Show Abstract | Download Original | Original Source | Check in Google Scholar | Full PDF (326.182 KB) | DOI: 10.21098/bemp.v18i1.514

Abstract

Recently, numerous Central Banks implement various macro-prudential policies to complement the existing monetary policy. This paper analyzes the impact of these policies along with the market structure, on the bank’s performance. Using panel data analysis, this paper conclude that the reserve requirement ratio policy negatively affect the bank’s performance (ROA). The empirical test shows the banking industry in Indonesia respond to the increase of reserve requirement by raising the Net Interest Margin to achieve their targeted operating profits. Secondly, this paper fail to find uniform conclusion across model variants about the effect of the policy rate on bank’s performance. This also applies on the Loan to Value policy. Fourth, the market concentration has a more significant effect on banks’ profitability as compared to market power. Fifth, the production index significantly affects the banking profitability. These findings implies a necessity for policy makers to review the financial market structure before formulating effective policy package to promote a healthy competition in the banking industry
RELATIVE EFFECTIVENESS OF INDONESIAN POLICY CHOICES DURING FINANCIAL CRISIS Silalahi, Tumpak; Chawwa, Tevy
Buletin Ekonomi Moneter dan Perbankan Vol 14 No 2 (2011): OCTOBER 2011
Publisher : Bank Indonesia

Show Abstract | Download Original | Original Source | Check in Google Scholar | Full PDF (457.964 KB) | DOI: 10.21098/bemp.v14i2.462

Abstract

The objective of this paper is to review the impact of crisis and policy measures taken during the crisis, to evaluate the effectiveness of those measures and to analyze the exit strategy in Indonesia. The econometric model was used to evaluate the impact of monetary and fiscal policy to economic output using quarterly data from 1990 - 2010. The result shows that monetary and fiscal policies have significant impact to economic output. In the short run the changes in real GDP is significantly affected by changes in real monetary supply in the previous three quarter and real fiscal expenditures. The lesson learned from this research among other are that cooperation and coordination among the policy makers and the timely responses are very important in tackling the crisis; an effective conventional monetary policy in normal times may become less effective in a crisis thus unconventional monetary policy indeed necessary as timely policy response and the improvement for more timely disbursement of government expenditure is important to increase the effectiveness of this policy to stimulate economic output. Moreover, several Indonesian exit strategy and policies to face future challenges are very important to reach the ultimate objective of sustainable economic growth while maintaining macroeconomic stability. JEL Classification : E52, E62, E63Keywords: monetary policy, fiscal policy, financial sector policy, global financial crisis.
IMPACT OF GLOBAL FINANCIAL SHOCK TO INTERNATIONAL BANK LENDING IN INDONESIA Silalahi, Tumpak; Wibowo, Wahyu Ari; Nurlian, Linda
Buletin Ekonomi Moneter dan Perbankan Vol 15 No 2 (2012): OCTOBER 2012
Publisher : Bank Indonesia

Show Abstract | Download Original | Original Source | Check in Google Scholar | Full PDF (421.662 KB) | DOI: 10.21098/bemp.v15i2.423

Abstract

This study intends to determine whether a shock that occurred in developed countries, the source of funding, was transmitted to Indonesia through international bank lending both directly and indirectly. The methods used estimated the determinants of international bank lending. International bank lending is one form of capital flows that have the potential for rapid reversal and that can lead to a financial crisis as it has in the past. Understanding the determinants of bank lending is important as it can be used to mitigate the impact of a financial crisis in the future. The empirical results showed that international bank lending, either directly or indirectly, contributed to the Indonesian crisis. During the shock, Indonesia saw global banking contract financing. It was also found that credit activities by foreign affiliates in Indonesia saw a contraction in the country of the parent bank during the shock. However, it was found that the bank lending by foreign affiliates, as joint ventureswere more stable compared to the branch offices of a foreign bank. In aggregate, international bank lending is affected by push and pulls factors such as economic growth (in developed countries and Indonesia), risk factors, and liquidity conditions, both in Indonesia and globally. As for micro-banking models, other than the push and pull factors, the bank balance sheet and other portfolio assets also affected bank lending activities to Indonesia. Keywords: Global Financial Shocks, Foreign Affiliates, International Bank Lending, transmission path,dynamic panel.JEL Classification: C33, E51, G15
RELATIVE EFFECTIVENESS OF INDONESIAN POLICY CHOICES DURING FINANCIAL CRISIS Silalahi, Tumpak; Chawwa, Tevy
Buletin Ekonomi Moneter dan Perbankan Vol 14 No 2 (2011): OCTOBER 2011
Publisher : Bank Indonesia

Show Abstract | Download Original | Original Source | Check in Google Scholar | Full PDF (462.739 KB) | DOI: 10.21098/bemp.v14i2.84

Abstract

The objective of this paper is to review the impact of crisis and policy measures taken during the crisis, to evaluate the effectiveness of those measures and to analyze the exit strategy in Indonesia. The econometric model was used to evaluate the impact of monetary and fiscal policy to economic output using quarterly data from 1990 - 2010. The result shows that monetary and fiscal policies have significant impact to economic output. In the short run the changes in real GDP is significantly affected by changes in real monetary supply in the previous three quarter and real fiscal expenditures. The lesson learned from this research among other are that cooperation and coordination among the policy makers and the timely responses are very important in tackling the crisis; an effective conventional monetary policy in normal times may become less effective in a crisis thus unconventional monetary policy indeed necessary as timely policy response and the improvement for more timely disbursement of government expenditure is important to increase the effectiveness of this policy to stimulate economic output. Moreover, several Indonesian exit strategy and policies to face future challenges are very important to reach the ultimate objective of sustainable economic growth while maintaining macroeconomic stability. JEL Classification : E52, E62, E63Keywords: monetary policy, fiscal policy, financial sector policy, global financial crisis.
IMPACT OF GLOBAL FINANCIAL SHOCK TO INTERNATIONAL BANK LENDING IN INDONESIA Silalahi, Tumpak; Wibowo, Wahyu Ari; Nurliana, Linda
Buletin Ekonomi Moneter dan Perbankan Vol 15 No 2 (2012): OCTOBER 2012
Publisher : Bank Indonesia

Show Abstract | Download Original | Original Source | Check in Google Scholar | Full PDF (384.033 KB) | DOI: 10.21098/bemp.v15i2.63

Abstract

This study intends to determine whether a shock that occurred in developed countries, the source of funding, was transmitted to Indonesia through international bank lending both directly and indirectly. The methods used estimated the determinants of international bank lending. International bank lending is one form of capital flows that have the potential for rapid reversal and that can lead to a financial crisis as it has in the past. Understanding the determinants of bank lending is important as it can be used to mitigate the impact of a financial crisis in the future. The empirical results showed that international bank lending, either directly or indirectly, contributed to the Indonesian crisis. During the shock, Indonesia saw global banking contract financing. It was also found that credit activities by foreign affiliates in Indonesia saw a contraction in the country of the parent bank during the shock. However, it was found that the bank lending by foreign affiliates, as joint ventureswere more stable compared to the branch offices of a foreign bank. In aggregate, international bank lending is affected by push and pulls factors such as economic growth (in developed countries and Indonesia), risk factors, and liquidity conditions, both in Indonesia and globally. As for micro-banking models, other than the push and pull factors, the bank balance sheet and other portfolio assets also affected bank lending activities to Indonesia.Keywords: Global Financial Shocks, Foreign Affiliates, International Bank Lending, transmission path,dynamic panel.JEL Classification: C33, E51, G15