Indonesia remains one of the highest-potential markets for future growth in the financial sector as the bulk of its population still lack access to financial services.
But global investors are reluctant to enter the banking market in Asean’s largest economy because of concerns about what they see as protectionist regulations. Those rules, adopted last year by legislators with one eye on the 2014 elections, were cited in the collapse last month of a plan by Singapore-based DBS to take over PT Bank Danamon Indonesia Tbk.
Some local bankers have defended the rules, saying the potential in Indonesia is so great that investors should be prepared to meet the government’s terms, as they will be well rewarded.
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