Hedging can be defined as an 'insurance' for market players to anticipate any number of possibilities in future
Jakarta (ANTARA) - State-owned bank PT Bank Rakyat Indonesia (Persero) TBK, or BRI, held a Hedging School to enable market players to prepare various risk mitigation strategies amid market and economic uncertainty.

"Hedging can be defined as an 'insurance' for market players to anticipate any number of possibilities in future," Primary Vice Director of BRI Catur Budi Harto noted in an official statement received here on Friday.

Seconding Harto’s views, Director of Financial Market Development Department, Bank Indonesia, Rahmatullah Sjamsudin stated that hedging is a "required" product for market players.

"By conducting hedging, market players can mitigate the potential risks of currency strengthening and weakening," he explained.


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Currently, hedging transactions still constitute a small percentage of Indonesia's total foreign currency transactions, Sjamsudin added.

Hedging transactions only account for 39 percent of the total foreign currency transactions in Indonesia's foreign currency market, he remarked.

Hence, collaboration between authorities and banks is deemed necessary to educate and disseminate information to market players on hedging, he noted.

In addition, Deputy Assistant of Financial Service, Ministry of State-Owned Enterprises (SOEs), Muhammad Koerur Roziqin stated that the ministry will offer support to boost several national derivative transactions.

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"This is until it is recorded that 62 percent of SOEs have conducted hedging in the second quarter of 2021," he remarked.

The Hedging School by BRI is projected to offer insights into financial products that could sustain business activities.

As one of the banks that provide hedging transaction service for more than 30 years, BRI has been bestowed several international rewards, such as Best FX Bank for Retail Clients, Best FX Bank for Money Market Products, and Best FX Bank for Structured Products.


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Translator: Kuntum Riswan, Fadhli R
Editor: Fardah Assegaf
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