Indonesia Banks: BI governor resignation: impact on our peak-rate thesis

Research evidence excerpt

Indonesia Banks: BI governor resignation: impact on our peak-rate thesis

Nomura Securities Malaysia Sdn Bhd

3 August 2026Indonesia Banks

EQUITY: BANKS

BI governer resignation: impact on our peak-rate thesis Research Analysts

Indonesia Research Team

Tushar Mohata, CFA - NSMQuick Note tushar.mohata@nomura.com

+60(3)20276895Bank Indonesia Governor Perry Warjiyo resigned on 27 July, five days after the policy

meeting, which we discussed in ourreport lastweek. Senior Deputy Governor Destry Onshore expert

Damayanti is serving as acting governor pending appointment of a permanent successor.

Sekuritas Rupiah Bank Indonesia (SRBI) outstanding balance and yields have exhibited Erwin Wijaya (erwin.wijaya@verdhana.id)

limited movement since the announcement – however, the rupiah continues to trade near Theonshoreexperts,whoare

cycle-lows despite the 5.75% policy rate, and we view institutional risk as an increasingly employedbyPTVerdhanaSekuritas

material factor for Indonesian assets along with the monetary policy trajectory. Indonesia(“Verdhana”)andarenot

Despite the BI-Rate at 5.75% and SRBI yields near cycle highs, USD/IDR remains range- licensedoutsideIndonesia,have

bound at IDR18,100-18,200, modestly above the IDR18,247 high reached on 8 June – contributedtothecontentofthis

reportunderapartnershipagreementsuggesting diminished currency responsiveness to the rate/SRBI transmission

betweenNomuraandVerdhana.mechanism. We believe a governance risk premium may now be embedded in asset

pricing, and view our prior peak-rate thesis as contingent on the appointment of a credible,

market-oriented permanent governor. A dovish or politically driven appointment could

necessitate further rate or SRBI-yield increases to restore policy credibility,