ANALISIS MODAL PENJAMINAN DAN PERILAKU MORAL HAZARD DALAM KEBIJAKAN LIMITED GUARANTEE: Tinjauan Kritis Pada LPS-Indonesia

Abstract

This article discusses two main issues. First, the risk-shifting behavior in the banking industry, and secondly, capital adequacy problems of LPS. Blanket guarantee policy is considered able to restore public confidence in the Indonesian banking industry post of 1997 monetary crisis. Nevertheless, this policy has led to various practices of moral hazard. This condition initiates the Government to issue a limited guarantee policy which the implementation is submitted to LPS. The study shows that the two policies are equally potential to create moral hazard, but with a different pattern. The analysis from the capital side indicated that the LPS capital is still very limited. By simulating six scenarios of the bailout fund, the simulation results indicated that LPS capital can only assume clients claim a maximum of 1% of total third-party funds which they guaranteed.

Keywords:  risk-shifting, blanket guarantee, limited guarantee, LPS, and the bailout