OJK says it is going all-out on Indonesia capital market reforms

Jakarta (ANTARA) - Indonesia’s Financial Services Authority (OJK) has reiterated its commitment to comprehensive capital market reforms following an evaluation by Morgan Stanley Capital International (MSCI).

“It is wrong to assume that we are doing nothing. We have instead been going all-out in everything we have done,” OJK Board of Commissioners Chair Friderica Widyasari Dewi said during a doorstep interview with journalists in Jakarta on Tuesday.

Among the reforms introduced by OJK this year are mandatory disclosure of shareholdings exceeding 1 percent, measures to address high shareholding concentration (HSC), and a gradual increase in the minimum free-float requirement to 15 percent.

OJK has also expanded its investor classification system to 39 categories to provide a more detailed breakdown of domestic and foreign investors.

Regarding alleged violations of capital market regulations, Dewi said OJK needed time to establish the facts before imposing sanctions. She added that serious allegations, including coordinated trading, required thorough investigations to identify those responsible.

She also urged market participants to assess developments in Indonesia’s capital market rationally, taking into account the condition of the national economy and companies’ fundamentals.

Meanwhile, Dewi said the 5.65 percent rebound in Indonesia’s Composite Stock Price Index (IHSG) to 5,278.89 at Tuesday’s close reflected improving sentiment in the domestic market.

She also attributed the share buybacks conducted by several companies to efforts to sustain positive market sentiment.

MSCI previously announced a consultation with market participants on a proposal to reclassify Indonesia’s stock market from Emerging Market to Standalone Market status.

The announcement triggered an 11.57 percent drop in the IHSG to 5,185.11 on Friday (October 16).

Following a meeting with MSCI on Monday (October 19), Indonesian stock market authorities announced several measures, including enhanced disclosure of share ownership and the exclusion of stocks with high shareholding concentration from the IHSG.

OJK has also imposed a total of Rp2.1 trillion in fines on three companies for violations of capital market regulations.

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Translator: Rizka Khaerunnisa, Nabil Ihsan
Editor: M Razi Rahman
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