Admittedly, the Government's mission to rebuild its battered banking industry is an enormous one. The years following the Asian financial crisis have been far from kind to the country. Political and social upheavals sparked by a currency in free fall pushed once-powerful local conglomerates, which owned many of the banks, close to a financial meltdown.
But the Government's move to recapitalise, restructure and prepare the banks for sale - vital though the task is - is only part of its rescue mission. The bigger challenge is rebuilding shattered public confidence in the institutions, plagued in the not-too-distant past by a liquidity disaster and charges of cronyism. At a time when we have TV images of poverty-striken customers in Argentina demanding that shuttered banks reopen and return their savings, the task of restoring public confidence cannot be under-estimated.
But to date, the number of banks that have been actively seeking to do this and disassociate themselves from their past masters can be counted on one hand. Bank Mandiri, the Government-owned bank, is one example that springs easily to mind. So it is heartening to see two newly-recapitalised banks now taking the next step on the road to recovery. However, it appears that the notion of becoming customer-centric and forging an emotional bond with account holders are still novel ideas with Indonesian banks, if Bank Niaga is an example to go by. In its 47 years, the bank had taken its customers for granted, as its new agency reveals.
If there is a silver lining to the Asian financial crisis, it's this: the disaster has forced companies in the region to clean up their house and pay greater attention to their public image.
