The Principle of Publicity in the Binding of Guarantees For Credit in the Distribution of Credit in Banking Institutions Linked to the Prudential Banking Principle

Abstract

Objective: This research aims to determine the principle of publicity in binding collateral for mortgage rights in lending to banking institutions about the tenets of Prudential Banking. Method: The type of research used is normative legal research to test applicable norms or provisions. It can also be researched by examining library materials or secondary data. Doctrinal legal research. The approach method used is the conceptual approach method. Result: Economic actors complete their financial needs by borrowing funds or capital, which is called credit, through public or private banks, users of banking products or services because there are still practices that are considered not in line with existing regulations, thus resulting in or having an impact on the debtors and creditors themselves. It can harm both parties, both materially and immaterially. Conclusion: The application of the principle of prudence in credit distribution is critical to ensure that the bank is always in a healthy condition, always in a liquid, solvent and profitable condition, especially in the distribution of funds with collateral for land rights; the application of the publicity principle is also very influential in determining the position of the bank, especially in taking back credit repayments. Therefore, the focus of prudence and the direction of publicity support the achievement of legal certainty for parties entering into agreements in credit agreements, especially in providing mortgage credit.