Indonesia's parliament on Thursday approved financial sector legislation that expands the mandate of Bank Indonesia and introduces new governance provisions affecting the central bank and other financial regulators, Reuters reported the same day.
Under the legislation, the central bank's policy objectives will be broadened to include supporting "an economic environment conducive to real-sector growth and job creation." The law also introduces a new mechanism concerning the removal of members of Bank Indonesia's board of governors, according to the report.
In addition, the legislation grants parliament a greater role in overseeing independent financial regulators. Lawmakers will be able to evaluate bodies such as Bank Indonesia, the Financial Services Authority (OJK) and the Indonesia Deposit Insurance Corp. (LPS), and issue recommendations that are binding, the news outlet reported.
The legislation also establishes a legal framework for the planned demutualization of the Indonesian Stock Exchange, sets rules for the development of an exchange for minerals and other strategic commodities, and sets rules for the proposed creation of an international financial center in the country, Reuters reported.
The full text of the legislation had not been publicly released, according to the report.
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