Regulatory Alerts2019-05-17
Bank Indonesia Regulation Number 21/7/PBI/2019 Concerning Amendment to Bank Indonesia Regulation Number 20/10/PBI/2018 Concerning Domestic Non-Deliverable Forward Transactions
Bank Indonesia issued Regulation Number 21/7/PBI/2019 to amend the rules governing Domestic Non-Deliverable Forward (DNDF) transactions in order to enhance liquidity and efficiency in the domestic foreign exchange market. The regulation introduces flexibility by exempting the underlying transaction requirement for DNDF sales up to USD 5,000,000 per customer and permits the unwinding of these positions without underlying transactions. Additionally, it clarifies documentation standards for underlying transactions and establishes specific settlement mechanisms using reference rates like JISDOR or Bank Indonesia FX mid rates.
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