Regulatory Alerts2011-08-08
Bank Indonesia Circular Letter No. 13/20/DPM on Second Amendment to Open Market Operations Regulations
Bank Indonesia issued Circular Letter No. 13/20/DPM to optimize Open Market Operation instruments by introducing new provisions for foreign currency transactions on Government Securities and enhancing early redemption requirements. The regulation establishes a daily auction mechanism for foreign currency sales against rupiah, restricting participation to Foreign Exchange Banks and mandating settlement on a T+2 basis. It also imposes strict sanctions for settlement failures, including written reprimands and financial penalties calculated based on specific interest rates plus 200 basis points.
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