Circular Letter of the Financial Services Authority Number 52/SEOJK.03/2016 Regarding People's Bank Business Plans

To:
The Board of Directors of People's Credit Banks At your place.

COPY
CIRCULAR LETTER OF THE FINANCIAL SERVICES AUTHORITY NUMBER 52/SEOJK.03/2016 REGARDING PEOPLE'S CREDIT BANK BUSINESS PLANS

In view of the implementation of the Financial Services Authority Regulation Number 37/POJK.03/2016 regarding People's Credit Bank Business Plans and Sharia People's Financing Business Plans (State Gazette of the Republic of Indonesia Year 2016 Number 258, Supplement to the State Gazette of the Republic of Indonesia Number 5955), hereinafter referred to as the POJK on BPR and BPRs Business Plans, the Financial Services Authority needs to regulate implementation provisions regarding BPR Business Plans in this Financial Services Authority Circular Letter as follows:

I. GENERAL PROVISIONS

1. In order to achieve business objectives in accordance with the established vision and mission, BPRs need to formulate Business Plans by considering external and internal factors that can affect the sustainability of BPR business, prudential principles, and the principles of healthy banking. Business Plans must be formulated thoughtfully, realistically, and comprehensively, so that they can be used as a basis for providing policy direction in carrying out business activities to achieve the BPR's vision and mission.

2. Business Plans are written documents that describe the development plans and business activities of BPRs within a certain period, as well as strategies to realize such plans in accordance with the targets and timeframes established.

3. Business Plans formulated by BPRs as referred to in item 2 include short-term, medium-term, and/or long-term strategic plans.
   What is meant by short-term plans are BPR business activity plans within a 1 (one) year period.
   What is meant by medium-term plans are BPR business activity plans within a 3 (three) year period.
   What is meant by long-term strategic plans are BPR business activity plans within a 5 (five) year period, with coverage including among others policy directions for capital development and strengthening, information technology, and human resources. Short-term and medium-term plans must be formulated by considering the long-term strategic plans within a 5 (five) year period established by the BPR.

4. Considering differences in capital capacity that affect the complexity of business activities and the limitations of the BPR's office network area, the projection period and planning of some content in the formulation of BPR Business Plans are differentiated based on core capital, namely:
   a. BPRs with core capital of less than IDR 50,000,000,000.00 (fifty billion rupiah); and b. BPRs with core capital of at least IDR 50,000,000,000.00 (fifty billion rupiah). This differentiation is intended so that each BPR can develop and contribute optimally according to its capital group.

5. The calculation of days referred to in the POJK on BPR and BPRs Business Plans regarding the submission of Business Plans and their adjustments, changes to Business Plans, and Business Plan Realization Reports are calendar days.

6. The calculation of days referred to in the POJK on BPR and BPRs Business Plans regarding the submission of Business Plan Supervision Reports is working days.

II. SCOPE AND FORMULATION OF BUSINESS PLANS

In accordance with Article 6 of the POJK on BPR and BPRs Business Plans, BPR Business Plans must at least include executive summaries, business strategies and policies, financial statement projections, ratio targets and financial positions, fund collection plans, fund disbursement plans, capital plans, organizational development plans, information technology and Human Resources (HR), plans for implementing new business activities, plans for network office development and/or changes, and other information.

1. Executive Summary
   Executive summaries must at least include strategic plans and steps to be taken by the BPR, key financial indicators, and short-term and medium-term targets, as follows:

a. Strategic Plans and Steps
Strategic plans and steps to be taken by the BPR are explained in short-term for a 1 (one) year period, medium-term for a 3 (three) year period, and long-term strategic plans for a 5 (five) year period.

b. Key Financial Indicators
Key financial indicators must at least include BPR performance and projections of capital factors, asset quality, profitability, and liquidity in accordance with the BPR's health level assessment, as follows:

1. BPRs with core capital of less than IDR 50,000,000,000.00 (fifty billion rupiah) submit BPR performance:
   a) actual position at the end of October of the year of BPR Business Plan formulation; b) projections at the end of December of the year of BPR Business Plan formulation; and c) projections for 1 (one) year ahead presented semi-annually, from capital factors, asset quality, profitability, and liquidity in accordance with the BPR's health level assessment.

The format for the key financial indicators table of the 2018 BPR Business Plan for BPRs with core capital of less than IDR 50,000,000,000.00 (fifty billion rupiah) must at least be as follows:

Key Financial Indicators Table:
(in percent)
No. Key Financial Indicator
Performance
Oct
Projection
Dec
Year 2018
Jun Dec
1 KPMM Ratio
2 Core Capital Ratio
3 Classified Productive Assets Ratio against Productive Assets 4 PPAP Ratio against Required PPAP 5 Non-Performing Loan Ratio a. Gross b. Net 6 Loan Ratio against Total Productive Assets 7 Return On Assets (ROA) Ratio 8 Net Interest Margin (NIM) Ratio 9 Operating Costs Ratio against Operating Income 10 Cash Ratio (CR) 11 Loan to Deposit Ratio (LDR) 12 SME Credit Ratio against Total Credit

2. BPRs with core capital of at least IDR 50,000,000,000.00 (fifty billion rupiah) submit BPR performance:
   a) actual position at the end of October of the year of BPR Business Plan formulation; b) projections at the end of December of the year of BPR Business Plan formulation; c) projections for 1 (one) year ahead presented semi-annually; and d) projections at the end of the second and third years presented annually, from capital factors, asset quality, profitability, and liquidity in accordance with the BPR's health level assessment.

The format for the key financial indicators table of the 2018 BPR Business Plan for BPRs with core capital of at least IDR 50,000,000,000.00 (fifty billion rupiah) must at least be as follows:

Key Financial Indicators Table:
(in percent)
No. Key Financial Indicator
Performance
Oct
Projection
Dec
Year
2018 Dec
Dec
2020 Jun Dec
1 KPMM Ratio
2 Core Capital Ratio
3 Classified Productive Assets Ratio against Productive Assets 4 PPAP Ratio against Required PPAP 5 Non-Performing Loan Ratio a. Gross b. Net 6 Loan Ratio against Total Productive Assets (%) 7 Return On Assets Ratio 8 Net Interest Margin Ratio 9 Operating Costs Ratio against Operating Income 10 Cash Ratio 11 Loan to Deposit Ratio 12 SME Credit Ratio against Total Credit

c. Short-Term and Medium-Term Targets
Short-term targets are BPR business activity targets for the next 1 (one) year, at least including the reduction of Non-Performing Loans (NPL), the improvement of intermediary functions, and the improvement of efficiency. Medium-term targets are BPR business activity targets for the next 3 (three) years, at least including efforts to strengthen capital, as well as the implementation of BPR corporate governance and risk management strategies referring to Financial Services Authority regulations on corporate governance and risk management for BPRs.

Presentation formats for Executive Summaries refer to:
a. Appendix I.1: Executive Summary - Strategic Plans and Steps b. Appendix I.2: Executive Summary - Key Financial Indicators (For BPRs with core capital of less than IDR 50 billion)
c. Appendix I.3: Executive Summary - Key Financial Indicators (For BPRs with core capital of at least IDR 50 billion)
d. Appendix I.4: Executive Summary - Short-Term and Medium-Term Targets

2. Business Strategies and Policies
   This section contains explanations of business strategies and policies that must at least include the BPR's vision and mission, BPR policy directions, BPR corporate governance and risk management policies, BPR's competitive position analysis based on assets and/or location, credit disbursement strategies to debtors by business type covering micro, small, and medium enterprises, and business development strategies, as follows:

a. BPR Vision and Mission
Vision is the goal to be achieved by the BPR in the medium or long term.
Mission is a statement used to describe the objectives of the BPR.
BPR vision and mission are formulated for a 5 (five) year period and submitted by BPRs annually. The 2018 to 2023 BPR vision and mission are submitted for the first time on December 15, 2017, in the 2018 BPR Business Plan.

b. BPR Policy Directions
BPR policy directions are explained in short-term for a 1 (one) year period, medium-term for a 3 (three) year period, and long-term strategic plans for a 5 (five) year period, including general policy information established by management in the future development of BPR business.

c. BPR Corporate Governance and Risk Management Policies
Descriptions of BPR corporate governance and risk management policies include information on steps to implement risk management and policies for implementing corporate governance, including remuneration policies covering salaries, bonuses, and other facilities for the Board of Directors and Board of Commissioners.

d. BPR Competitive Position Analysis Based on Assets and/or Location To conduct position analysis, BPRs can use SWOT analysis, i.e., Strength, Weakness, Opportunity, and Threat, in facing competition with other BPRs and/or financial institutions. To conduct position analysis in competition based on location, BPRs can use the limitations of regency, city, and/or province areas.

e. Credit Disbursement Strategies by Business Type Strategies to realize credit disbursement plans are grouped by business type, namely credit disbursement strategies for micro, small, and medium enterprises, referring to business criteria based on laws regarding micro, small, and medium enterprises.

f. Business Development Strategies
Descriptions of business development strategies include information on strategic steps to achieve the BPR's established business objectives, including explanations of organizational and information technology development strategies, and strategies to anticipate changes in external conditions.

Presentation formats for business strategies and policies refer to Appendix II.

3. Financial Statement Projections
   Financial statement projections must at least include balance sheet projections and profit and loss projections, as well as reasons or considerations regarding the establishment of targets in the formulation of projections, as follows:

a. BPRs with core capital of less than IDR 50,000,000,000.00 (fifty billion rupiah) Financial statement projections explained for:

1. actual position at the end of October of the year of BPR Business Plan formulation;
2. projections at the end of December of the year of BPR Business Plan formulation; and
3. projections for 1 (one) year ahead presented semi-annually.
   Presentation formats for financial statement projections refer to:
4. Appendix III.1: Balance Sheet Projections
5. Appendix IV.1: Profit and Loss Projections

b. BPRs with core capital of at least IDR 50,000,000,000.00 (fifty billion rupiah) Financial statement projections explained for:

1. actual position at the end of October of the year of BPR Business Plan formulation;
2. projections at the end of December of the year of BPR Business Plan formulation;
3. projections for 1 (one) year ahead presented semi-annually; and
4. projections at the end of the second and third years presented annually.
   Presentation formats for financial statement projections refer to:
5. Appendix III.2: Balance Sheet Projections
6. Appendix IV.2: Profit and Loss Projections

4. Ratio Targets and Financial Positions
   Ratio targets and financial positions must at least include core financial ratio targets and targets for certain other positions, as well as reasons or considerations regarding the establishment of targets. Core financial ratio targets include ratios that must at least provide information for assessing capital conditions, asset quality, profitability, and liquidity, referring to regulations on BPR health level assessments. Targets for certain other positions must at least include targets for several ratios related to micro, small, and medium enterprise credit to total credit, the ratio of education and training funds to total labor costs of the previous year, the ratio of the realization of education and training funds to total budgeted education and training funds, and the ratio of collateral taken over to total credit.

a. BPRs with core capital of less than IDR 50,000,000,000.00 (fifty billion rupiah) Ratio targets and financial positions presented for:

1. actual position at the end of October of the year of BPR Business Plan formulation;
2. targets at the end of December of the year of BPR Business Plan formulation; and
3. targets for 1 (one) year ahead presented semi-annually.
   Presentation formats for ratio targets and financial positions refer to Appendix V.1.

b. BPRs with core capital of at least IDR 50,000,000,000.00 (fifty billion rupiah) Ratio targets and financial positions presented for:

1. actual position at the end of October of the year of BPR Business Plan formulation;
2. targets at the end of December of the year of BPR Business Plan formulation;
3. targets for 1 (one) year ahead presented semi-annually; and
4. targets at the end of the second and third years presented annually.
   Presentation formats for ratio targets and financial positions refer to Appendix V.2.
   Calculation formulas for ratio targets and financial positions refer to Appendix V.3.

5. Fund Collection Plans
   Fund collection plans must at least include:
   a. third-party fund collection plans, including plans to collect savings and deposits from related and unrelated parties, as well as information on core depositors and depositors; and b. other funding plans, including among others loans from other banks, including linkage programs and/or loans not from banks. These plans reflect fund collection positions for:
   a. actual position at the end of October of the year of BPR Business Plan formulation; b. projections at the end of December of the year of BPR Business Plan formulation; and
   c. projections for 1 (one) year ahead presented semi-annually.
   This section also elaborates on the reasons or considerations used in formulating these plans and the BPR's strategies to realize them.
   Information on core depositors is information on the 25 (twenty-five) largest depositor data, while core depositors are information on the 25 (twenty-five) largest depositor data. Presentation formats for fund collection plans refer to:
   a. Appendix VI: Third-Party Fund Collection Plans b. Appendix VII: Other Funding Plans

6. Fund Disbursement Plans
   Fund disbursement plans must at least include:
   a. fund disbursement plans to related parties
   Related parties are related parties as regulated in regulations regarding maximum credit limits for BPRs.
   Presentation formats for fund disbursement plans to related parties refer to Appendix VIII.1.

b. fund placement plans in other banks
Placement in other banks in the form of:

1. current accounts, time deposits, certificates of deposit, and/or savings in commercial banks and/or Sharia commercial banks; and/or
2. time deposits, and/or savings in BPRs and/or BPRs.
   Presentation formats for fund placement plans in other banks refer to Appendix VIII.2.

c. credit disbursement plans to other banks
Information on credit disbursement plans to other banks can be presented individually per bank or cumulatively.
Presentation formats for credit disbursement plans to other banks refer to Appendix VIII.3.

d. credit disbursement plans to core debtors
Core debtors are individual debtors or group debtors included in the category of the 25 (twenty-five) largest debtors at the BPR, excluding related parties.
Presentation formats for credit disbursement plans to core debtors refer to Appendix VIII.4.

e. credit disbursement plans based on economic sectors that are priorities in credit disbursement Credit disbursement plans are presented based on economic sectors that are priorities in the BPR's credit disbursement. These economic sectors must be at most 5 (five) economic sectors with the largest percentage of credit disbursement from the total BPR credit disbursement portfolio. Details of economic sectors are as regulated in the Guidelines for Formulating Monthly BPR Reports. Presentation formats for credit disbursement plans based on priority economic sectors refer to Appendix VIII.5.

f. credit disbursement plans based on usage type Credit disbursement plans are presented based on usage types, including working capital credit, investment credit, and consumption credit, as regulated in the Guidelines for Formulating Monthly BPR Reports. Presentation formats for credit disbursement plans based on usage type refer to Appendix VIII.6.

g. credit disbursement plans based on business type Groupings of business types, including micro, small, and medium enterprises, refer to business criteria based on laws regarding micro, small, and medium enterprises. Presentation formats for credit disbursement plans based on business type refer to Appendix VIII.7.

These plans reflect fund disbursement positions for:
a. actual position at the end of October of the year of BPR Business Plan formulation; b. projections at the end of December of the year of BPR Business Plan formulation; and
c. projections for 1 (one) year ahead presented semi-annually.
This section also elaborates on the reasons or considerations used in formulating these plans and the BPR's strategies to realize them.

7. Capital Plans
   Capital plans must at least include plans to fulfill the Minimum Capital Adequacy Ratio (KPMM) and Core Capital Ratio, plans to fulfill minimum core capital, and plans for capital changes, as follows:

a. Plans to Fulfill Minimum Capital Adequacy Ratio (KPMM) and Core Capital Ratio KPMM plans must at least include capital plans, Risk-Weighted Assets (RWA) plans, and KPMM ratio plans explained for:

1. actual position at the end of October of the year of BPR Business Plan formulation;
2. plans at the end of December of the year of BPR Business Plan formulation;
3. plans for 1 (one) year ahead presented semi-annually; and
4. plans at the end of the second and third years presented annually.
   Plans to fulfill KPMM ratios and core capital ratios refer to Financial Services Authority regulations on minimum capital adequacy requirements and minimum core capital fulfillment for BPRs. Plans to fulfill KPMM ratios in 2018 BPR Business Plans until the effective date of calculations for KPMM ratios and core capital ratios as regulated in Financial Services Authority regulations on minimum capital adequacy requirements and minimum core capital fulfillment for BPRs are formulated using calculations referring to regulations on minimum capital adequacy requirements as regulated in Bank Indonesia Regulation No. 8/18/PBI/2006 dated October 5, 2006, regarding Minimum Capital Adequacy Requirements for People's Credit Banks. Presentation formats for KPMM ratio fulfillment plans for 2018 Business Plans until the effective date of Financial Services Authority regulations on minimum capital adequacy requirements and minimum core capital fulfillment for BPRs refer to Appendix IX.1. Presentation formats for KPMM ratio fulfillment plans for Business Plans since the effective date of Financial Services Authority regulations on minimum capital adequacy requirements and minimum core capital fulfillment for BPRs refer to Appendix IX.2.

b. Plans to Fulfill Minimum Core Capital
Plans to fulfill minimum core capital are intended for BPRs that have not yet fulfilled minimum core capital requirements as regulated in Financial Services Authority regulations on minimum capital adequacy requirements and minimum core capital fulfillment for People's Credit Banks. This section also elaborates on the reasons or considerations used in formulating these plans and the BPR's strategies to realize them. Plans to fulfill minimum core capital are presented for:

1. actual position at the end of October of the year of BPR Business Plan formulation;
2. plans at the end of December of the year of BPR Business Plan formulation;
3. plans for 1 (one) year ahead presented semi-annually; and
4. plans at the end of the second, third, fourth, and fifth years presented annually.
   Presentation formats for plans to fulfill minimum core capital refer to Appendix IX.3.

c. Capital Addition Plans
Capital addition plans are projections of capital additions over the next 3 (three) years, both regarding structure and amount.
Capital addition plans include plans for capital additions from existing shareholders and plans for other capital additions. These plans are explained for:

1. actual position at the end of October of the year of BPR Business Plan formulation;
2. plans at the end of December of the year of BPR Business Plan formulation;
3. plans for 1 (one) year ahead presented semi-annually; and
4. plans at the end of the second and third years presented annually.
   Presentation formats for capital addition plans refer to Appendix IX.4.

8. Organizational Development, Information Technology, and Human Resources (HR) Plans
   This section elaborates on information regarding current organizational structures and HR numbers, ongoing organizational, information technology, and HR development plans, or other organizational, information technology, and HR development plans for at least 1 (one) year ahead, including among others:

a. Organizational Development Plans
Organizational development plans include among others plans for the formation or change of work units and/or committees adjusted to the size and complexity of BPR business, referring to Financial Services Authority regulations on the implementation of corporate governance and risk management for BPRs. Presentation formats for organizational development plans refer to Appendix X.

b. Fundamental Information Technology Development and Procurement Plans

Information Technology Development and Procurement Plan Fundamental information technology development and procurement plans include, among others, significant changes to information technology configurations or core banking applications, procurement of new core banking applications, cooperation with information technology service providers, and other fundamental information technology developments and procurements that can increase and/or enhance the risks of BPR or BPRS. The presentation format for fundamental information technology development and procurement plans refers to Appendix XI.

c. Human Resource Development Plan
Human resource development plans include, among others, fulfilling human resources at the BPR, plans for human resource education and training needs, including education and training cost/budget plans as regulated in provisions regarding the obligation to provide funds for education and training for BPR human resource development. The presentation format for human resource development plans refers to Appendix XII.

d. Outsourced Labor Utilization Plan
Outsourcing is the delegation of part of the work execution to a service provider company through a subcontracting agreement and/or a labor supply service agreement.
Outsourced labor utilization plans include, among others, plans for utilizing labor outside of permanent employees, covering the number and fields of assignment.
The presentation format for outsourced labor utilization plans refers to Appendix XIII.

9. New Business Activity Implementation Plan
   The implementation plan for new business activities that must be included in the BPR Business Plan includes at least:
   a. the implementation plan for business activities requiring approval from the Financial Services Authority; and b. the implementation plan for business activities that must be reported to the Financial Services Authority. This section elaborates on the implementation plan for new business activities for at least the next 1 (one) year. The new business activity implementation plan that must be included in the BPR Business Plan is a new business activity or support for new business activities that meet the criteria:
   a. has never been implemented previously by the relevant BPR; or b. was implemented previously by the relevant BPR, but involved development that changed certain or all risks of the relevant BPR, as regulated in Financial Services Authority regulations regarding business activities and office network areas of BPR based on core capital. The presentation format for the New Business Activity Implementation Plan refers to Appendices XIV.1 and XIV.2.

10. Branch Network Development and/or Change Plan
    The branch network development and/or change plan includes at least:
    a. the plan to relocate the head office address; b. the plan to open, relocate the address, and/or close branch offices and/or cash offices;
    c. the plan to implement cash service activities and the plan to close cash service activities consisting of mobile cash, payment points, and electronic banking devices; and
    d. the plan to relocate payment points and locations of Automated Teller Machines and/or Automated Deposit Machines.
    The definitions of branch offices, cash offices, and cash service activities consisting of mobile cash, payment points, and electronic banking devices refer to Financial Services Authority regulations regarding BPR. The plan is presented for the next 1 (one) year period. The presentation format for the branch network development and/or change plan refers to Appendix XV.

11. Other Information
    Other information includes information estimated to affect BPR business activities, but not mentioned in the scope of the Business Plan, such as steps to resolve problematic loans including collateral takeover and/or write-off, resolution of Acquired Collateral (AYDA) and write-offs, and reports on BPRs as Officeless Financial Service Providers in the Context of Inclusive Finance (Laku Pandai). The presentation format for other information refers to Appendix XVI.

III. BUSINESS PLAN CHANGES

1. The Financial Services Authority has the authority to request BPRs to make adjustments to the Business Plan submitted by the BPR, if:
   a. the Business Plan is assessed as not meeting the scope of the Business Plan as regulated in POJK on BPR and BPRS Business Plans; and/or b. projections, targets, or plans submitted in the Business Plan are assessed as unrealistic, for example:

1. High credit projections without being balanced by adequate funding capacity and human resource numbers.
2. Investment plans involving the purchase of fixed assets in large quantities without considering the profitability of the BPR.

2. A BPR may only make changes to the Business Plan if:
   a. there are external and internal factors that significantly affect BPR operations; The term "external factors" includes economic conditions, social and political developments, and technological developments. Example:
   A decline in regional economic growth causes a decrease in credit demand in the trading sector, which is the priority for BPR credit disbursement, thereby affecting the repayment ability of debtors in that sector. Based on these conditions, the BPR can change its credit disbursement priorities to other sectors, which is then reflected in the Business Plan change. The term "internal factors" includes financial conditions, management, and ownership changes. Example:
   A change in BPR ownership causes a change in BPR business strategy, so the BPR needs to make changes to the Business Plan. b. based on the consideration of the Financial Services Authority, there are factors that significantly affect BPR performance, including solvency issues, liquidity issues, and/or external issues that significantly impact BPR performance.

IV. REALIZATION REPORT AND BUSINESS PLAN SUPERVISION

1. According to Article 21 paragraph (1) of POJK on BPR and BPRS Business Plans, the Business Plan Realization Report must be submitted by the BPR semi-annually, namely at the end positions of June and December. The report includes:
   a. achievement of the Business Plan, i.e., comparison between plan and realization; b. explanation of the causes and obstacles resulting in differences between the plan and the realization of the Business Plan; and
   c. follow-up measures taken and to be taken to improve the realization achievement.
   The explanation regarding the realization of the Business Plan includes at least:
   a. business strategy and policies; b. financial performance realization on the balance sheet, profit and loss statement, as well as ratios and financial items;
   c. realization of fund gathering;
   d. realization of fund disbursement; e. realization of fulfillment of Minimum Capital Adequacy Ratio, minimum core capital fulfillment, and capital addition plans; f. realization of organizational, information technology, and human resource development; g. realization of new business activity implementation; h. realization of branch network development and/or changes; and
   i. realization of other information.
   The presentation format for the Business Plan Realization Report refers to Appendix XVII.1.
   The presentation format for financial performance realization on the balance sheet, profit and loss statement, as well as ratios and financial items as referred to in letter b refers to Appendices XVII.2, XVII.3, and XVII.4. The filling format for other information realization as referred to in letter i refers to Appendix XVII.5.
2. According to Article 5 of POJK on BPR and BPRS Business Plans, the Board of Commissioners is required to supervise the implementation of the Business Plan. The results of this supervision are subsequently formulated in the Business Plan Supervision Report as mandated in Article 22 paragraph (1) of POJK on BPR and BPRS Business Plans. The scope of the report prepared by the Board of Commissioners includes at least an assessment regarding:
   a. the implementation of the Business Plan comprising quantitative and qualitative assessments of the Business Plan realization; b. factors influencing BPR performance including capital adequacy, asset quality, profitability, and liquidity referring to provisions regarding the assessment of BPR health level;
   c. the application of BPR corporate governance and risk management; and
   d. efforts to improve BPR performance, in case the assessment results as referred to in letter b above show a decline in performance.
   The Board of Commissioners' assessment in letters a through d can also be supplemented with assessments of external factors influencing BPR operations.
   In connection with the duties of the Board of Commissioners, the BPR must have an internal mechanism for preparing the aforementioned Business Plan Supervision Report. The presentation format for the Business Plan Supervision Report refers to Appendix XVIII.

V. COVER LETTER FORMAT
Submission of the Business Plan offline, cover letter for submission of Business Plan changes/adjustments offline, cover letter for submission of Business Plan Realization Report offline, and cover letter for submission of Business Plan Supervision Report refer to Appendix XIX.

VI. REPORT SUBMISSION

1. Timeframe
   Referring to Article 24 paragraph (1), Article 24 paragraph (2), Article 25 paragraph (1), and Article 25 paragraph (2) of POJK on BPR and BPRS Business Plans, a BPR is declared late in submitting the Business Plan, Business Plan adjustment, Business Plan Realization Report, and/or Business Plan Supervision Report if:
   a. the BPR submits the Business Plan beyond the submission deadline up to 30 (thirty) days after the end of the Business Plan submission deadline; b. the BPR submits the Business Plan adjustment beyond the submission deadline up to 20 (twenty) days after the end of the Business Plan adjustment submission deadline;
   c. the BPR submits the Business Plan Realization Report beyond the submission deadline up to 30 (thirty) days after the end of the Business Plan Realization Report submission deadline; and/or
   d. the BPR submits the Business Plan Supervision Report beyond the submission deadline up to a maximum of 30 (thirty) working days after the end of the Business Plan Supervision Report submission deadline. Referring to Article 24 paragraph (3) and Article 25 paragraph (3) of POJK on BPR and BPRS Business Plans, a BPR is declared not to have submitted the Business Plan, Business Plan adjustment, Business Plan Realization Report, and/or Business Plan Supervision Report if, until the expiration of the lateness deadline, the BPR has not yet submitted the said report.

2. Offline Report Submission
   a. In the event that a BPR submits the Business Plan, Business Plan adjustment, Business Plan change, and Business Plan Realization Report offline, the submission may be done using electronic data recording media (among others compact disk, flashdisk, or other electronic data recording media) submitted to the Financial Services Authority according to the region of the BPR's head office. b. In the event of damage to the electronic data recording media received by the Financial Services Authority offline, the BPR resubmits the electronic data recording media.
   c. The BPR submits the Business Plan Supervision Report offline to the Financial Services Authority in hardcopy (printout) form, and softcopy in the form of electronic data recording media.

VII. OTHERS
Appendices in this Financial Services Authority Circular are formats for compiling the Business Plan, Business Plan Realization Report, and Business Plan Supervision Report starting from 2018. The appendices in this Financial Services Authority Circular are an inseparable part of this Financial Services Authority Circular.

VIII. CLOSING
Provisions in this Financial Services Authority Circular shall take effect on the date of determination.
Determined in Jakarta on December 23, 2016
EXECUTIVE HEAD OF BANKING SUPERVISOR
FINANCIAL SERVICES AUTHORITY, sd
NELSON TAMPUBOLON
Copy matches the original
Legal Director 1
Legal Department sd
Yuliana