Indonesia's Financial Services Authority plans to relax a policy that requires banks' domestic operations to be run by a single entity, Bloomberg News reported.
The move is part of the regulator's efforts to support mergers in the banking industry and strengthen the sector against increased competition from financial technology firms. The amendments will be made for both foreign and local banks later in the year, the Aug. 1 report added, citing Heru Kristiyana, commissioner for banking supervision at the financial regulator.
The single presence rule was implemented in 2006 to promote consolidation among domestic lenders. It, however, did not prove to be popular among some foreign banks that were looking to grow their business in the country, Bloomberg noted.