Abstract
<p>This research paper investigates present day strategic priorities employed by large (foreign exchange) banks in Indonesian banking industry. The research used ‘idea networking’ of the mission statements of banks as the means to identifying a handful of priorities. The population comprised commercial banks in Indonesia. Foreign exchange banks in Indonesia were chosen as a sample of this study .The study was conducted in 2014. The research method utilized in this study is qualitative clustering through idea networking. In this method, the idea statements were extracted and linked to each other to produce diagrams resulting in clusters of statements that were generalized into priorities. The finding from this study is that Indonesian banks have six main priorities of “service excellence”, “prudent corporate governance”, “innovative”, “customer segmentation focus”, “professionalism” and “social responsibility”. This, undoubtedly, provides some insight into the potential threats to the Indonesian bank industry as well as an agenda for change.</p><p>Penelitian ini mengkaji mengenai prioritas strategik pada bank-bank besar (valuta asing) dalam industri perbankan Indonesia. Penelitian ini menggunakan ‘idea networking’ dari pernyataan misi bank sebagai sarana untuk mengidentifikasi beberapa prioritas. Populasi terdiri atas bank komersial di Indonesia. Bank valuta asing di Indonesia dipilih sebagai sampel penelitian ini. Penelitian ini dilakukan pada tahun 2014. Metode penelitian yang digunakan dalam penelitian ini adalah qualitative clustering melalui ‘ide networking’. Dalam metode ini, pernyataan ide diekstraksi dan dihubungkan satu sama lain untuk menghasilkan diagram yang menghasilkan kelompok pernyataan yang digeneralisasikan ke dalam prioritas. Temuan dari studi ini adalah bahwa perbankan Indonesia memiliki enam prioritas utama “pelayanan prima”, “tata kelola perusahaan yang bijaksana”, “inovatif”, “focus segmentasi pelanggan”, “profesionalisme” dan “tanggung jawab sosial”. Hal ini, tidak diragukan lagi, memberikan beberapa wawasan ke dalam potensi tantangan terhadap industri perbankan Indonesia serta agenda perubahan.</p><p>JEL Classification G3, G32</p>
Highlights
Banks still hold the dominant role in the economy of Indonesia at about 78.24% of market share followed by other institutions (Supriyanto, 2013)
According to regulation from the central bank (Bank Indonesia 2013), some criteria for bank to be foreign exchange banks are: CAR (Capital Adequacy Ratio) minimum of 8% in the last month, the level of health during the past 24 months in a row categorized as healthy, Rp.150 billion minimum paid-up capitals, banks preparedness to carry out foreign exchange transactions, human resources, and operational guidelines
Banks need to spend some money in order to actualize excellent services and good Corporate Social Responsibility (CSR)
Summary
Banks still hold the dominant role in the economy of Indonesia at about 78.24% of market share followed by other institutions (Supriyanto, 2013). The competition in the Indonesian banking industry has been sharp since the government introduced its deregulation package in the banking sector in October 1988 (Alfansi & Sargeant, 2000) This financial regulation abolished the restriction on the formation of new private banks and allowed foreign banks to form joint ventures with local partners in Indonesia. Based on data from Bank Indonesia cited in Kameyama et al (2006) the number of banks, both national and private banks rose remarkably from 124 in 1988 to 240 in 1996, while the number of branch offices increased significantly from 1,900 to more than 6,000 These conditions, undoubtedly, caused stiff competition among banks in the financial industry. The research targeted private owned banks that conduct banking business in foreign currencies (foreign exchange banks)
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
