Thursday, January 15, 2015

Mandiri Bank Embraces Three Foreign Banks to Develop Repo Market

Mini Master Repo Agreement Implementation is done by exploiting the use of standard contracts in repo transactions / reverse repo interbank. PT Bank Mandiri (Persero) cooperates with three foreign banks, the Bank of Tokyo-Mitsubishi UFJ, JP Morgan Chase Bank and Hongkong & Shanghai Banking Corp. (HSBC). This cooperation to strengthen the financial markets through the use of services repurchase (repo) / reverse.

In signing the cooperation Mini MRA was conducted by the Director of Treasury and Markets, Bank Mandiri Royke Tumilaar, Genarl Manger Bank of Tokyo-Mitsubishi UFJ Jakarta Yusuke Katsuka, Senior Country Officer of JP Morgan Chase Bank Jakarta Branch, Haryanto T. Budiman, and Managing Director of HSBC Jakarta Ali Setiawan, who also witnessed by Senior Deputy Governor of Bank Indonesia Mirza Adityaswara and Director of Bank Mandiri Budi G. Sadikin.

"The cooperation with foreign banks is the first time in banking, where foreign banks using the Mini Master Repo Agreement (MRA) as a standard contract in the deal," said Director of Bank Mandiri, Budi Gunadi Sadikin, at Plaza Mandiri, Jakarta, Wednesday 14th January 2015.

He explained that through this partnership, the Bank expects to support the national banking system in optimizing repo transactions / reverse repo as an alternative funding and utilization of excess liquidity. This cooperation is very profitable banking industry, including foreign banks, to meet the financing needs, particularly the short-term as well as helping reduce the risk of liquidity.

"We hope to encourage other banks to cooperate Mini MRA this," said Budi.

Furthermore Budi added, implementation Mini MRA performed by utilizing the use of standard contracts in repo transactions / reverse repo interbank. This is done to simplify and minimize the potential risk of repo transactions / reverse repo interbank.

"The presence of alternative funding will further deepen the interbank money market, while providing greater flexibility for banks to manage liquidity and strengthen resilience to shocks in banking," he said.

Related to this, until the end of last year, the bank has cooperated Mini MRA with 60 banks with the volume of transactions recorded at IDR 32 trillion during 2014. The volume of Repo transaction volume in 2013 increased from IDR 24 trillion. "The surge was mainly driven by transactions Mini MRA cooperation established with BPD, national commercial banks and joint venture banks," added Budi.

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