Bank Indonesia Regulation No. 7/17/PBI/2005 Special Treatment For Rural Banks Following The Natural Disasters In Nanggroe Aceh Darussalam Province And Nias Regency, North Sumatra Province

BANK INDONESIA REGULATION
NUMBER: 7/17/PBI/2005
CONCERNING
SPECIAL TREATMENT FOR RURAL BANKS FOLLOWING THE NATURAL DISASTERS IN NANGGROE ACEH DARUSSALAM PROVINCE AND NIAS REGENCY, NORTH SUMATRA PROVINCE THE GOVERNOR OF BANK INDONESIA, Considering : a. whereas following the natural disasters in Nanggroe Aceh Darussalam Province and Nias Regency, North Sumatra Province, it is necessary to pursue various measures to promote recovery in economic activities; b. whereas one measure for promotion of recovery in economic activities is the provision of special treatment for Rural Banks;
c. now therefore it is deemed necessary to enact provisions
concerning special treatment for Rural Banks following the natural disasters in the Nanggroe Aceh Darussalam Province and Nias Regency, North Sumatra Province, in a Bank Indonesia Regulation; In view of : 1. Act Number 7 of 1992 concerning Banking (State Gazette of the Republic of Indonesia Number 31 of 1992, Supplement to the State Gazette of the Republic of Indonesia Number 3472), as amended by Act Number 10 of 1998 (State Gazette of the Republic of Indonesia Number 182 of 1998, Supplement to the State Gazette of the Republic of Indonesia Number 3790);
2. Act …

2. Act Number 23 of 1999 concerning Bank Indonesia (State
Gazette of the Republic of Indonesia Number 66 of 1999, Supplement to the State Gazette of the Republic of Indonesia Number 3843) as amended by Act Number 3 of 2004 (State Gazette of the Republic of Indonesia Number 7 of 2004, Supplement to the State Gazette of the Republic of Indonesia Number 4357); HAS DECREED:
To enact : THE BANK INDONESIA REGULATION CONCERNING SPECIAL TREATMENT FOR RURAL BANKS FOLLOWING THE NATURAL DISASTERS IN NANGGROE ACEH DARUSSALAM PROVINCE AND NIAS REGENCY, NORTH SUMATRA PROVINCE.
CHAPTER I
GENERAL PROVISIONS
Article 1
The terminology used in this Bank Indonesia Regulation has the following meanings:
1. “Rural Bank,” hereinafter referred to as RB, is a Rural Bank as defined in
Act Number 7 of 1992 concerning Banking, as amended by Act Number 10 of 1998;
2. “Credit” …

2. “Credit” is the provision of funds or equivalent claims based on a loan
agreement or contract between the RB and another party requiring the borrowing party to repay the debt at a specified term with interest.
CHAPTER II
CREDIT QUALITY
Article 2
(1) Credit quality for rescued debt shall be classified current commencing from actions taken for rescue through January 31, 2008. (2) Debt Rescue as referred to in paragraph (1) may take place by:
a. Rescheduling, namely amendment of terms and conditions of Credit only in regard to payment schedule and/or term; b. Reconditioning, namely amendment of terms and conditions of Credit in whole or in part, not limited to amendment of payment schedule, term, and/or other requirements insofar as these amendments do not involve change in the maximum balance of Credit; or
c. Restructuring, namely amendment of terms and conditions of Credit
with regard to:
(1) Additional funds from the RB, and/or (2) Conversion of interest arrears in whole or in part to Credit, which may be accompanied by rescheduling and/or reconditioning.
Article 3 …

Article 3
The provisions referred to in Article 2 shall apply only to Credit that satisfies the following requirements:
a. Credit already extended at the time of promulgation of these provisions; b. Credit disbursed to debtors with project locations or business locations in the Nanggroe Aceh Darussalam Province and/or Nias Regency, North Sumatra Province; and
c. Has or is deemed likely to experience difficulties in repayment of loan
principal and/or interest or Financing margin or profit share by reason of impact of the natural disasters in the Nanggroe Aceh Darussalam Province and Nias Regency, North Sumatra Province.
Article 4
The provisions concerning special treatment for Credit as referred to in Article 2 and Article 3 shall also apply to RBs conducting business based on Sharia Principles for provision of funds encompassing financing (mudharabah or musyarakah), receivables (murabahah, salam, or istishna), leasing (ijarah), and loans (qardh).
CHAPTER III
REPORTING
Article 5
(1) RBs impacted by natural disaster shall be exempted from the financial penalties for late reporting and failing to submit reports as referred to in the applicable legal provisions concerning Guidelines for Preparation of RB Monthly Reports, the LLL Report, the Work Plan Report, the Work Plan Progress …

Progress Report, the Annual Financial Statement, and the Published Financial Statement. (2) Exemption as referred to in paragraph (1) shall be effective through August 31, 2005.
CHAPTER IV
CONCLUDING PROVISIONS
Article 6
This Bank Indonesia Regulation shall come into force on the date of its enactment and shall be effective retroactively from December 27, 2004. Enacted in Jakarta Dated July 1, 2005 THE GOVERNOR OF BANK INDONESIA, BURHANUDDIN ABDULLAH STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 55 OF 2005 DPBPR/DPbS

ELUCIDATION
TO
BANK INDONESIA REGULATION
NUMBER: 7/17/PBI/2005
CONCERNING
SPECIAL TREATMENT FOR RURAL BANKS FOLLOWING THE NATURAL DISASTERS IN NANGGROE ACEH DARUSSALAM PROVINCE AND NIAS REGENCY, NORTH SUMATRA PROVINCE GENERAL REVIEW As widely reported, the tsunami disaster in the Nanggroe Aceh Darussalam Province and the earthquake in Nias Regency, North Sumatra Province that took place respectively on December 26, 2004, and March 28, 2005, have impacted the Indonesian economy specifically in Nanggroe Aceh Darussalam Province and Nias Regency, North Sumatra Province. Debtors affected by the disaster are experiencing difficulties in meeting their obligations under their loan or financing agreements, and thus the deterioration in debtor financial capacity will strongly affect operational condition of the RBs. Furthermore, the natural disasters have impacted the institutional presence, management, and physical condition of RBs. In this regard, Bank Indonesia deems it necessary to provide special treatment for credit in the form of relaxation in assessment of credit quality and the requirements for regular reporting to Bank Indonesia.
ARTICLE ...

ARTICLE BY ARTICLE
Article 1
Self-explanatory
Article 2
paragraph (1)
Rescued Credit is Credit originally classified current or sub￾standard that has become doubtful or loss as a result of natural disaster, in cases which remedial measures are under way as set forth in a Credit rescue agreement. paragraph (2) Self-explanatory
Article 3
letter a
“Credit already extended” is defined as including any undisbursed portion of an agreed line of credit. letter b Self-explanatory letter c Self-explanatory
Article 4 ...

Article 4
Self-explanatory
Article 5
paragraph (1)
Self-explanatory paragraph (2)
Self-explanatory
Article 6
Self-explanatory
SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 4509 DPBPR/DPbS