Jakarta, 1 August 2020 --- As the bridge between Indonesia and the world, BNI New York Overseas Branch Office (KCLN) has an important role as a source of funding in the United States dollar. This representative office, which was established in 1978, also has a role as an investor relation, representing BNI in the global market.
Aidil Azhar, the Head of BNI New York Branch said, one of the advantages of BNI New York is that it has been a member of Fedwire since 2018. Fedwire is a local clearing facility at the United States (US) central bank, The Federal Reserve. As a member of Fedwire, BNI New York can process payment transactions directly without the need to correspondent banks. The Payment transaction is in the form of commercial payment, both in the form of remittances, trade finance, and bank to bank payments related to treasury services.
“BNI New York is one of the first Indonesia banks that become Fedwire member. So by becoming a member, BNI New York can offer correspondent bank transaction services to commercial banks in Indonesia. We can serve book two or three book banks in Indonesia that have foreign exchange status for US dollar transactions. Usually they open an account at BNI New York in the form of US dollars," Aidil said when contacted in New York during an online interview session last week.
Another advantage after being registered as a member of Fedwire is BNI New York Branch Office can help these banks in conducting transfer transactions. If an Indonesian bank transfers money in USD to a bank in the US or outside the US, they will channel it through BNI New York.
"For example, if their customers want to send it to Bank of America, or Bank of New York, we will accept transactions from the bank, for example from BPD (regional development bank). Then we will channel it, or we will clear it, and the recipient bank will receive it on the same day, even at the same minute. Well, that is not only on remittance transactions but also transactions related to trade and treasury," explained Aidil.
In addition to serving USD transactions for foreign exchange banks from Indonesia, BNI New York Branch Office also helps as an advisor in international banking. For example, giving advisory if there are questions or anything related to international transactions or related to transactions in dollars.
"We usually give advice too. For example, there are banks in Indonesia that are only willing to transact with foreign currencies, usually we can provide assistance and help them so that they are ready to become foreign exchange banks, and even if needed, (we) can issue a kind of reference letter that is usually required by the Financial Services Authority (OJK) as one foreign exchange bank requirements,” said Aidil.
BNI New York Branch Office as BNI’s representative overseas also has a mission to become US dollar funding source with competitive price. BNI New York Branch Office is expected to be able to raise fund to support business, both local in the US and in relation to Indonesia.
Similar to other overseas BNI branch offices, BNI New York's mission, as an office network, is mandated by the international division to be the bridge between Indonesia and the world. BNI New York focuses on all businesses related to Indonesia.
"We in New York are expected to be able to provide assistance to local business people who will conduct transactions with Indonesia, as well as Indonesian businessmen who want to go international or market their products in the international market," he added.
In addition, no less important, BNI New York Branch Office is a training ground for BNI professional employees. Another mission of BNI New York is also to become an investor relations representative of BNI in the global market.
"So, if there are interests related to investment in Indonesia, we collaborate with related agencies, there are also representatives of the Coordinating Investment Agency Board (BKPM), well, we also function as investor relations to attract investors or become BNI’s mouthpiece in the world market," he explained.
Certificate of Deposit
With regard to its function as a USD-denominated funding source, since 2020 BNI New York Branch Office has created a new initiative by launching a CD, certificate of deposit program. According to Aidil, this CD (global CD) program is a maximum of USD 1 billion and is valid for two years.
“Until July 2020, BNI New York Branch Office has issued 400 million USD CDs,“ he explained.
Aidil added, these CDs were issued based on the needs. “The tenor can be 1 month, 3 months, 6 months, 9 months, up to one year,” he concluded.
For more information, please contact:
Corporate Secretary BNI