THE Financial Services Authority (OJK) should be cautious when dealing with non-performing loans in the national banking system. There is the potential for moral hazard, especially in the implementation of the problematic debt restructuring policy. The OJK must learn from the experience of the Indonesian Bank Restructuring Agency (IBRA) from 1998 to 2004.

In the first eight months of this year, the non-performing loan rate has risen steadily. As o