Indonesia to Relax Bank Merger Rule to Boost Foreign Investment

Indonesia is planning further steps to make it easier for foreign banks to invest in local lenders, as it tries to strengthen the sector against growing competition from financial technology firms.

The Financial Services Authority, known as OJK, expects to amend the so-called single presence policy later this year, according to Heru Kristiyana, commissioner for banking supervision at the regulator. The revised rule, which will make no distinction between foreign and local lenders, would relax the longstanding requirement that the acquiring banks have to merge all their local operations into one entity.

“The single presence policy will be flexible so ...