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2002 Annual Report
Chairman's
Statement
A number of main market indicators during the
first quarter of 2002 reflected a sign of remarkable enthusiasm
and optimism from our capital market players. Composite Indices
in Jakarta Stock Exchange (JSX) and Surabaya Stock Exchange
(SSX), for example, recorded increase of 40.7% and 14.47%
respectively. Following this significant growth, total value of
monthly transaction in the two exchanges also rose tremendously
whereby in April 2002 the value hit IDR 20.3 trillion in JSX and
IDR 923 billion in SSX.
However, with the presence of various internal and external
factors— especially the unearthing of scandals in corporate
America such as Enron and Worldcom—which were not encouraging
for market development, those two indicators went into a nasty
slump in the ensuing quarter.
Composite Index in JSX even fell
to a four-year low in October 2002 and total value of monthly
transaction posted a mere IDR6 trillion in September 2002. This
decreasing trend did not only appear in our two exchanges but
also haunt other markets around the region including other major
international markets.
Aside from these declining trends, our market still had other
things to cheer up about last year. And those things were from
investment fund industry. Total unit holders of investment funds
were up by 107.83 %, from a total of 51,723 in 2001 to a total
of 107,494 in the end of December 2002. Total value of public
funds placed in investment fund also followed suit by recording
an eye-popping 454.52 % increase, from IDR 8.003 trillion in
2001 to astounding IDR 44.370 trillion in the end of December
2002.
Year 2002 also witnessed the introduction of remote trading
system in JSX in the end of March and the implementation of T+3
settlement system in early September. Other important
developments last year took the advantage of the momentum of
Indonesian Capital Market 25th Anniversary by
introducing online trading system in SSX on August 9, 2002 and
the establishment of Indonesian Capital Market Arbitration Board
(ICMAB). This institution is expected to play a pivotal role in
dealing with civil cases in Indonesian Capital Market.
During the 2002 Bapepam also issued two new rules concerning
Accountant Independency in Audit Services in Capital Market and
concerning Public Offering of Debt Securities in Currency
Denomination Other Than Rupiah, and revised eight Bapepam’s
rules. The objective of this regulatory overhaul was to improve
investors’ protection as well as to respond to market dynamic,
which was among other things called for fine-tuning the existing
rules and regulation. Bapepam now has a total of 147 rules.
In the enforcement area, Bapepam has finished inspecting 33
cases of suspected violation from a total of 44 cases, 33 out of
which were brought from inspection level to investigation level.
The year 2002 also saw another landmark in the field of law
enforcement in which Bapepam, with the help from the National
Police, took a suspected violator into custody. This case
related to alleged market manipulation on shares transaction of
PT. Primarindo Infrastructure Tbk (BIMA) that was listed in JSX.
By laying the
final stone in studying Business Model for National Securities
Companies in the year 2002, Indonesian Capital Market industry
is ready to embrace a new era in year 2003. Securities companies
are encouraged to improve their capacity, roles, and
contribution in shaping the future of the Indonesian Capital
Market. In line with the plan to demutualize the exchanges, Self
Regulatory Organizations—JSX, SSX, Indonesian Clearing and
Guarantee Corporation, and Indonesian Central Securities
Depository—were requested to intensively consider a way to
conclude a number of steps that had been taken to realize the
plan.
Year 2003 will be the Year of Restructuring
Indonesian Capital Market Industry. We are convinced that
through teamwork and full commitment to continuously rebuild and
reform the existence and role of this industry in the future the
year 2003 will bring enlightenment and that we will be better
than the year before.
Herwidayatmo,
Chairman
Table of Contents Bapepam Annual Report 2002
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