Circular Letter of the Financial Services Authority of the Republic of Indonesia Number 11/SEOJK.03/2022 Concerning the Assessment of the Health Level of Rural Banks and Sharia Rural Financing Banks

To:

1. The Board of Directors of Rural Banks; and
2. The Board of Directors of Sharia Rural Financing Banks,
   At their places.

COPY

CIRCULAR LETTER OF THE FINANCIAL SERVICES AUTHORITY REPUBLIC OF INDONESIA NUMBER 11 /SEOJK.03/2022

CONCERNING

ASSESSMENT OF THE HEALTH LEVEL OF RURAL BANKS AND SHARIA RURAL FINANCING BANKS

In connection with the establishment of the Financial Services Authority Regulation Number 3/POJK.03/2022 concerning the Assessment of the Health Level of Rural Banks and Sharia Rural Financing Banks (State Gazette of the Republic of Indonesia Year 2022 Number 58, Additional State Gazette of the Republic of Indonesia Number 6773), hereinafter referred to as POJK on BPR and BPRS Health Assessment, it is necessary to regulate the implementation of the POJK on BPR and BPRS Health Assessment in this Financial Services Authority Circular Letter as follows:

I. GENERAL PROVISIONS

1. In this Financial Services Authority Circular Letter, the following terms are meant:

a. Rural Bank, hereinafter abbreviated as BPR, is a conventional bank that does not provide payment circulation services in its activities.

b. Sharia Rural Financing Bank, hereinafter abbreviated as BPRS, is a Sharia bank that does not provide payment circulation services in its business activities.

c. BPR and BPRS Health Level is the result of the assessment of the condition of BPR and BPRS conducted on the risk profile, governance, profitability, and capital factors of BPR and BPRS.

d. Composite Rating is the final rating of the Health Level Assessment results of BPR and BPRS.

2. In line with the development of the BPR and BPRS industry, the BPR and BPRS Health Level assessment system needs to be perfected to provide a picture of BPR and BPRS performance based on risk according to actual performance and forward-looking, as well as to increase the effectiveness of the implementation of risk management and governance. The increase in the effectiveness of the implementation of risk management and governance aims so that BPR and BPRS are able to identify problems more early, take appropriate and faster corrective actions, and apply better risk management and governance so that BPR and BPRS can survive in business competition and crisis conditions and carry out their business activities better.

3. The Health Level of BPR and BPRS and the management and sustainability of BPR and BPRS business are the full responsibility of the BPR and BPRS management. Therefore, as referred to in Article 2 paragraph (1) of the POJK on BPR and BPRS Health Assessment, BPR and BPRS are required to maintain and/or improve the health level by applying prudent principles and risk management in carrying out business activities, and applying Sharia principles for BPRS, including conducting periodic self-assessments of the health level and taking effective corrective steps.

On the other hand, the Financial Services Authority evaluates and assesses the Health Level of BPR and BPRS and takes appropriate and timely supervisory actions by considering the conditions and problems faced.

II. GENERAL PRINCIPLES OF BPR AND BPRS HEALTH LEVEL ASSESSMENT

To fulfill the obligations as referred to in Article 7 of the POJK on BPR and BPRS Health Assessment, the BPR and BPRS Health Level assessment with a risk-based approach is conducted by observing the general principles of BPR and BPRS Health Level assessment as follows:

1. Risk-Oriented
   The BPR and BPRS Health Level assessment is based on the risk and impact caused on the overall performance of BPR and BPRS. This is done by identifying internal and external factors that can increase risk or affect the financial performance of BPR and BPRS at present and in the future. Thus, it is expected to be able to detect the root causes of problems more early and take effective and efficient preventive and corrective steps.

2. Proportionality
   The use of parameters or components in each factor of the BPR and BPRS Health Level assessment is conducted by considering the characteristics and complexity of the BPR and BPRS business. The parameters or components of the BPR and BPRS Health Level assessment in this Financial Services Authority Circular Letter are minimum standards that must be used in assessing the Health Level of BPR and BPRS. The health level assessment may consider other parameters or components according to the characteristics and complexity of the business so that it can reflect the actual condition of BPR and BPRS.

3. Significance and Materiality
   The BPR and BPRS Health Level assessment needs to consider the significance and materiality of each factor of the BPR and BPRS Health Level assessment, namely risk profile, governance, profitability, and capital, as well as the significance of assessment parameters or components in each factor in concluding assessment results and setting factor ratings. The determination of significance and materiality is based on analysis supported by adequate data and information regarding the risk and financial performance of BPR and BPRS.

4. Comprehensive and Structured
   The assessment process is conducted thoroughly and systematically and is focused on the main problems of BPR and BPRS. Analysis is conducted in an integrated manner, namely by considering the interrelationship between risks and between factors of the BPR and BPRS Health Level assessment. Analysis must be supported by key facts and relevant ratios to show the level, trend, and level of problems faced by BPR and BPRS and is adequately documented.

III. SCOPE OF ASSESSMENT FACTORS

The BPR and BPRS Health Level assessment covers the assessment of 4 (four) factors consisting of:

1. Risk Profile Factor

a. The risk profile factor assessment is an assessment of the inherent risk and the quality of risk management implementation in the operational activities of BPR and BPRS, which reflects the risk control system of BPR and BPRS. The risks assessed consist of credit risk, operational risk, compliance risk, liquidity risk, reputation risk, and strategic risk in accordance with the Financial Services Authority Regulation concerning the implementation of risk management for BPR and the Financial Services Authority Regulation concerning the implementation of risk management for BPRS. Generally, the risk profile assessment consists of:

1. Inherent Risk Assessment
   Inherent risk assessment is an assessment of risks inherent in the business activities of BPR and BPRS, both quantifiable and non-quantifiable, which significantly affect the financial condition of BPR and BPRS. Inherent risk is determined by internal and external factors. The assessment of inherent risk is conducted by considering parameters that are both quantitative and qualitative. The determination of the inherent risk level for each type of risk is conducted based on comprehensive analysis of all parameters and pillars, including considering the significance and interrelationship between parameters and pillars.

2. Assessment of the Quality of Risk Management Implementation (KPMR)
   The KPMR assessment is an assessment of the adequacy of the risk control system covering all pillars of risk management implementation. The KPMR assessment must at least cover the assessment of 4 (four) pillars, namely:

a) For BPR:
(1) supervision by the Board of Directors and Board of Commissioners; (2) adequacy of policies, procedures, and limits, namely:
(a) risk management policy;
(b) risk management procedure; and
(c) determination of risk limits;
(3) adequacy of processes and systems, namely:
(a) risk identification, measurement, monitoring, and control processes; and (b) risk management information system; (4) comprehensive internal control system.

b) For BPRS:
(1) active supervision by the Board of Directors, Board of Commissioners, and Sharia Supervisory Board; (2) adequacy of risk management policies and procedures as well as determination of risk limits; (3) adequacy of risk identification, measurement, monitoring, and control processes as well as risk management information system; and (4) comprehensive internal control system.

The implementation of risk management by BPR and BPRS varies greatly according to the characteristics, complexity, and level of risk to be taken and tolerated by BPR and BPRS. The assessment of KPMR is conducted by considering parameters that are qualitative. The determination of parameter ratings is conducted through comprehensive analysis of assessment parameters by considering the interrelationship between parameters.

3. Determination of Risk Level for Each Type of Risk
   Based on the assessment of inherent risk and KPMR for each type of risk, the risk level is subsequently determined. The risk level is the risk inherent in the activities of BPR and BPRS after taking into account KPMR.

4. Determination of Risk Rating
   Based on the determination of the risk level for each type of risk, the risk rating is determined by considering the significance and materiality of each type of risk to the overall risk profile by observing the general principles of risk management implementation.

b. Guidelines and procedures for the assessment of the risk profile factor in more detail refer to the Financial Services Authority Regulation concerning the implementation of risk management for BPR and the Financial Services Authority Regulation concerning the implementation of risk management for BPRS.

c. As referred to in Article 8 of the POJK on BPR and BPRS Health Assessment, the implementation of risk management and submission of BPR risk profile reports are conducted according to category with implementation as follows:

Since the December 2022 Report Position

BPR Category	Type of Risk
1. BPR with core capital less than Rp50,000,000,000.00 (fifty billion rupiah)	At least: <br> a. credit risk; <br> b. operational risk; <br> c. compliance risk; and <br> d. liquidity risk.
2. BPR with core capital at least Rp50,000,000,000.00 (fifty billion rupiah)	a. credit risk; <br> b. operational risk; <br> c. compliance risk; <br> d. liquidity risk; <br> e. reputation risk; and <br> f. strategic risk.
3. BPR with core capital less than Rp50,000,000,000.00 (fifty billion rupiah) but has products, services, and/or other activities that increase risk exposure

Imposition of sanctions for violations of BPR risk management implementation based on risk position:

1. risk profile reports from June 2022 to June 2023 are conducted in accordance with the Financial Services Authority Regulation concerning the implementation of risk management for BPR;
2. since the December 2023 risk profile report, it is conducted in accordance with the POJK on BPR and BPRS Health Assessment.

d. As referred to in Article 9 of the POJK on BPR and BPRS Health Assessment, the implementation of risk management and submission of BPRS risk profile reports are conducted according to category with implementation as follows:

Since the December 2022 Report Position

BPRS Category	Type of Risk
BPRS with core capital at least Rp50,000,000,000.00 (fifty billion rupiah)	a. credit risk; <br> b. operational risk; and <br> c. compliance risk.

Since the June 2023 Report Position

BPRS Category	Type of Risk
1. BPRS with core capital at least Rp50,000,000,000.00 (fifty billion rupiah)	a. credit risk; <br> b. operational risk; <br> c. compliance risk; <br> d. liquidity risk; <br> e. reputation risk; and <br> f. strategic risk.
2. BPRS with core capital less than Rp50,000,000,000.00 (fifty billion rupiah)	a. credit risk; and <br> b. operational risk.

Since the December 2023 Report Position

BPRS Category	Type of Risk
1. BPRS with core capital at least Rp50,000,000,000.00 (fifty billion rupiah)	a. credit risk; <br> b. operational risk; <br> c. compliance risk; <br> d. liquidity risk; <br> e. reputation risk; and <br> f. strategic risk.
2. BPRS with core capital less than Rp50,000,000,000.00 (fifty billion rupiah)	At least: <br> a. credit risk; <br> b. operational risk; <br> c. compliance risk; and <br> d. liquidity risk.

Imposition of sanctions for violations:

1. BPRS risk management implementation and submission of BPRS risk profile reports, other than those related to changes in risk management implementation due to an increase in BPRS core capital, still refer to the Financial Services Authority Regulation concerning the implementation of risk management for BPRS; and
2. those related to changes in risk management implementation due to an increase in BPRS core capital refer to the POJK on BPR and BPRS Health Assessment.

Imposition of sanctions for the submission of BPRS risk profile reports as referred to in item 1) above starts being applied to the submission of reports:

1. first semester of 2023, for BPRS with core capital at least Rp50,000,000,000.00 (fifty billion rupiah); and
2. second semester of 2023, for BPRS with core capital less than Rp50,000,000,000.00 (fifty billion rupiah).

2. Governance Factor

a. The governance factor assessment is an assessment of the quality of governance principle implementation by BPR and BPRS management. The governance factor assessment is conducted based on analysis of:

1. Implementation of governance principles, namely:
   a) For BPR: openness, accountability, responsibility, independence, and fairness. b) For BPRS: openness, accountability, responsibility, professionalism, and fairness.

2. Adequacy of structure, process, and results of governance implementation which covers 11 (eleven) assessment factors of governance implementation, namely:

a) For BPR:
(1) implementation of duties and responsibilities of the Board of Directors; (2) implementation of duties and responsibilities of the Board of Commissioners; (3) completeness and implementation of duties or functions of committees; (4) handling of conflicts of interest; (5) implementation of compliance function; (6) implementation of internal audit function; (7) implementation of external audit function; (8) implementation of risk management, including internal control system; (9) maximum credit granting limit; (10) BPR business plan; and (11) transparency of financial and non-financial conditions.

b) For BPRS:
(1) implementation of duties and responsibilities of the Board of Directors; (2) implementation of duties and responsibilities of the Board of Commissioners; (3) implementation of duties and responsibilities of the Sharia Supervisory Board; (4) completeness and implementation of duties or functions of committees; (5) implementation of Sharia principles in BPRS activities; (6) handling of conflicts of interest; (7) implementation of compliance, internal audit, and external audit functions; (8) implementation of risk management, including internal control system; (9) maximum fund disbursement limit; (10) BPRS business plan; and (11) transparency of financial and non-financial conditions.

3. Other information related to governance based on relevant data and information.

b. Guidelines and procedures for the assessment of the governance factor refer to the Financial Services Authority Regulation concerning the implementation of governance for BPR and the Financial Services Authority Regulation concerning the implementation of governance for BPRS.

c. As referred to in Article 12 of the POJK on BPR and BPRS Health Assessment, the submission and publication of governance implementation reports since the December 2022 report position are conducted no later than January 31 for the December 31 position report.

1. Imposition of sanctions for the submission and publication of governance implementation reports for the December 2022 report position is conducted in accordance with the Financial Services Authority Regulation concerning the implementation of governance for BPR and the Financial Services Authority Regulation concerning the implementation of governance for BPRS if the submission and publication of reports exceed the time limit:
   a) 4 (four) months after December 31, 2022 for BPR; or b) 3 (three) months after December 31, 2022 for BPRS.

Example:
If a BPR or BPRS submits and publishes the governance implementation report for the December 2022 report position on February 15, 2023, the BPR or BPRS is not subject to sanctions for violation of submission and publication of reports in accordance with the POJK on BPR and BPRS Health Assessment. However, if a BPR or BPRS submits and publishes the governance implementation report for the December 2022 report position on May 15, 2023, the BPR or BPRS is subject to sanctions for violation of submission and publication of reports in accordance with the Financial Services Authority Regulation concerning the implementation of governance for BPR or the Financial Services Authority Regulation concerning the implementation of governance for BPRS.

2. Imposition of sanctions for the submission and publication of governance implementation reports since the December 2023 report position is conducted in accordance with the POJK on BPR and BPRS Health Assessment if the submission and publication of governance implementation reports exceed January 31 of the following year.

Example: If a BPR or BPRS submits and publishes the governance implementation report for the December 2023 report position on February 15, 2024, the BPR or BPRS is subject to sanctions for violation of submission and publication of reports in accordance with the POJK on BPR and BPRS Health Assessment.

d. The BPR and BPRS Health Level assessment for the June position considers the assessment of governance implementation for the December position of the previous year, adjusted to the development of conditions or problems in governance implementation during the last 6 (six) months.

3. Profitability Factor

a. The profitability factor assessment is an assessment of the condition and ability of BPR and BPRS to generate profit to support capital and operational activities adequately and continuously, which includes assessment of profitability performance and operational efficiency levels of BPR and BPRS. The profitability factor assessment is conducted by considering, among others, the level, trend, structure, stability of profitability, and/or comparison of BPR and BPRS performance with industry or peer group performance, for example, BPR and BPRS with similar characteristics, such as BPR and BPRS in the same operational area, or BPR and BPRS with the same scale and complexity of business. To support the profitability factor assessment process, BPR and BPRS can develop an industry or peer group performance database with data and information sourced from authorized parties or institutions.

b. The quantitative aspect assessment of the profitability factor is an assessment of 3 (three) components, namely:

1. Return on Asset (ROA);
2. Operational Expense to Operational Income Ratio (BOPO); and
3. Net Interest Margin (NIM) for BPR or Net Imbalan for BPRS.

c. In addition to the quantitative aspect assessment, the profitability factor assessment also considers the qualitative aspect assessment, namely:

1. profitability source, indicated among others by assessment of the contribution of income components supporting profitability;
2. profitability continuity, indicated among others by assessment of future profitability prospects; and/or
3. profitability management, indicated among others by assessment of the ability of BPR and BPRS to manage profitability.

4. Capital Factor

a. The capital factor assessment is an assessment of the adequacy of BPR and BPRS capital, which reflects financial support in the implementation of BPR and BPRS activities to absorb potential current and future losses. Assessment is conducted by considering the level, trend, structure, stability of capital, and comparison of BPR and BPRS performance with industry or peer group performance, for example, BPR and BPRS with similar characteristics, such as BPR and BPRS in the same operational area, or BPR and BPRS with the same scale and complexity of business. To support the capital factor assessment process, BPR and BPRS can develop an industry or peer group performance database with data and information sourced from authorized parties or institutions.

b. The quantitative aspect assessment of the capital factor is an assessment of 2 (two) components, namely:

1. Capital Minimum Fulfillment Liability Ratio (KPMM); and
2. Core Capital to Net Problematic Productive Assets Ratio (MIAPB).

c. The qualitative aspect assessment of the capital factor is an assessment of:

1. capital management, indicated by assessment of the understanding of the Board of Directors and Board of Commissioners regarding capital management, capital management policies and procedures, capital planning, and capital adequacy assessment; and/or
2. capital access ability, indicated by assessment of access to capital sources both from internal and external, for example, profitability performance supporting capital or other parties that can support BPR and BPRS capital.

IV. ASSESSMENT PROCEDURES

The BPR and BPRS Health Level assessment is conducted based on the following stages:

1. Stage of Determining Factor and Component Ratings

a. Risk Profile Factor
The risk profile factor rating is set into 5 (five) ratings, namely:

1. rating 1 (very low);
2. rating 2 (low);
3. rating 3 (medium);
4. rating 4 (high); or
5. rating 5 (very high).

The order of smaller risk profile factor ratings reflects the lower risk faced by BPR and BPRS as stated in Appendix Part A which is an inseparable part of this Financial Services Authority Circular Letter. The determination of the risk profile factor rating is conducted in accordance with the Financial Services Authority Regulation concerning the implementation of risk management for BPR and the Financial Services Authority Regulation concerning the implementation of risk management for BPRS.

b. Governance Factor
The governance factor rating is set into 5 (five) ratings, namely:

1. rating 1 (very good);
2. rating 2 (good);
3. rating 3 (fairly good);
4. rating 4 (less good); or
5. rating 5 (not good).

The order of smaller governance factor ratings reflects better governance implementation by BPR and BPRS as stated in Appendix Part B which is an inseparable part of this Financial Services Authority Circular Letter. The determination of the governance factor rating is conducted in accordance with the Financial Services Authority Regulation concerning the implementation of governance for BPR and the Financial Services Authority Regulation concerning the implementation of governance for BPRS.

c. Profitability Factor
The determination of the profitability factor rating is conducted by assessing quantitative and qualitative aspects, as follows:

1. In the quantitative aspect assessment, BPR and BPRS determine the profitability component rating by first calculating each profitability component and determining the rating of each profitability component by referring to Appendix Part C for BPR and Appendix Part D for BPRS which are inseparable parts of this Financial Services Authority Circular Letter. Subsequently, BPR and BPRS consider the qualitative aspect assessment which is an assessment of the source of profitability, continuity of profitability, and/or management of profitability.

2. The determination of the profitability factor rating is conducted based on comprehensive and structured analysis of quantitative and qualitative aspects by considering significance and considering other problems affecting the profitability of BPR and BPRS. The profitability factor assessment can be conducted by considering, among others, the level, trend, structure, stability of profitability, and/or comparison...

performance of BPR and BPRS with industry or peer group performance.

3. The ranking of the profitability factor is set into 5 (five) ranks, namely:
   a) rank 1 (very good); b) rank 2 (good); c) rank 3 (fairly good); d) rank 4 (less good); or e) rank 5 (not good).

A smaller order of the profitability factor rank reflects a better profitability condition.
The determination of the profitability factor rank is done by referring to Appendix Part E which is an inseparable part of this Financial Services Authority Circular.

d. Capital Factor

The determination of the capital factor rank is done by assessing quantitative and qualitative aspects, as follows:

1. In assessing the quantitative aspect, BPR and BPRS determine the rank of the capital components by first calculating each capital component and determining the rank of each capital component by referring to Appendix Part C for BPR and Appendix Part D for BPRS which are inseparable parts of this Financial Services Authority Circular. Furthermore, BPR and BPRS consider the assessment of the qualitative aspect which is an assessment of capital management and/or capital access capability.

2. The determination of the capital factor rank is done based on a comprehensive and structured analysis of quantitative and qualitative aspects by paying attention to significance and considering other problems that affect the capital of BPR and BPRS.

3. The rank of the capital factor is set into 5 (five) ranks, namely:

a) rank 1 (very good); b) rank 2 (good); c) rank 3 (fairly good); d) rank 4 (less good); or e) rank 5 (not good).

A smaller order of the capital factor rank reflects a better capital condition.
The determination of the capital factor rank is done by referring to Appendix Part F which is an inseparable part of this Financial Services Authority Circular.

2. Composite Health Level Ranking Determination Stage for BPR and BPRS

a. Based on the factor ranks obtained, each factor rank is multiplied by the factor weight, as follows:

1. risk profile factor, with a weight of 25% (twenty-five percent);
2. governance factor, with a weight of 30% (thirty percent);
3. profitability factor, with a weight of 15% (fifteen percent); and
4. capital factor, with a weight of 30% (thirty percent).

b. The sum of the factor ranks multiplied by the factor weight is called the composite value. The determination of the Composite Health Level Ranking is done based on the definition of Composite Ranking as stated in Appendix Part G which is an inseparable part of this Financial Services Authority Circular.

c. The determination of the Composite Health Level Ranking for BPR and BPRS consists of 5 (five) ranks, namely:

1. Composite Rank 1 (PK-1);
2. Composite Rank 2 (PK-2);
3. Composite Rank 3 (PK-3);
4. Composite Rank 4 (PK-4); and
5. Composite Rank 5 (PK-5).

A smaller order of Composite Rank reflects a healthier condition of BPR and BPRS.

d. The final health level assessment is determined based on an analysis of each health assessment factor including risk profile analysis, governance, profitability, capital, and overall health level analysis. The aforementioned analysis is part of a comprehensive and structured health level assessment that must at least include the latest information on the condition of BPR and BPRS, main problems being faced, including inter-factor relationships. In the event that BPR and BPRS use additional parameters and/or components for each health factor, BPR and BPRS must inform this in their self-assessment report.

3. Updating the Health Level Assessment of BPR and BPRS

a. The Health Level Assessment of BPR and BPRS can be updated at any time if BPR and BPRS meet certain conditions in accordance with the POJK on BPR and BPRS Health Level. Updates to the Health Level Assessment of BPR and BPRS can be done outside the end of June and December periods.

Example:
A BPR or BPRS faces significant problems in September due to fraud losses impacting the capital and overall performance of the BPR or BPRS.
Based on these conditions, the BPR or BPRS conducts an update of the health level assessment at the end of September position by considering the conditions of the problems that occurred.

b. The Financial Services Authority may request BPR and BPRS to submit the results of their self-assessment of the Health Level of BPR and BPRS at any time by providing a submission deadline in accordance with the conditions of the BPR and BPRS and the urgency of supervisory needs.

c. In the event that the results of the self-assessment update of the Health Level of BPR and BPRS are submitted at any time initiated by the BPR or BPRS, the submission is done after communication with the Financial Services Authority supervisor, which is subsequently reported through the Financial Services Authority reporting system based on a letter issued by the Financial Services Authority.

V. ACTION PLAN

1. In accordance with Article 17 paragraph (1) of the POJK on BPR and BPRS Health Level, in the event that based on the results of the Health Level Assessment of BPR and BPRS conducted by the Financial Services Authority and/or self-assessment results there are:
   a. governance and/or risk profile factors of BPR and BPRS that are set with rank 4 and/or rank 5; b. Composite Health Level Ranking of BPR and BPRS that is set with rank 4; and/or
   c. Composite Health Level Ranking of BPR and BPRS that is set other than rank 4 or rank 5, but has the potential to be set in intensive supervision or there are significant problems that need to be addressed so as not to disrupt the continuity of the business of BPR and BPRS,
   BPR and BPRS are required to submit an action plan.

Submission and implementation of the action plan and reports on the realization of the action plan are done in accordance with the POJK on BPR and BPRS Health Level.

2. Submission and implementation of risk management action plans including risk management review and ongoing supervision in accordance with the Financial Services Authority Circular regarding the implementation of risk management for BPR and the Financial Services Authority Circular regarding the implementation of risk management for BPRS, are done as referred to in item 1 above.

3. Submission and implementation of action plans in accordance with the Financial Services Authority Circular regarding the implementation of governance for BPR and the Financial Services Authority Circular regarding the implementation of governance for BPRS, are done as referred to in item 1 above.

4. BPR and BPRS prepare and submit an action plan in the event that BPR and BPRS meet certain conditions in accordance with the POJK on BPR and BPRS Health Level. Action plans include among others:
   a. improving the implementation of risk management with concrete improvement steps accompanied by a completion time target.

Example:
For a BPR or BPRS with a high credit risk level, an action plan that can be done is to lower the credit risk level by improving weaknesses in the quality of credit risk management implementation and/or lowering inherent credit risk exposure;

b. improving the implementation of governance with concrete improvement steps and a completion time target.

Example:
For a BPR or BPRS with a governance factor rank of 4, caused by weak compliance functions due to dual roles impacting task execution, the BPR or BPRS can improve these weaknesses by fulfilling the structure as per applicable regulations and increasing the effectiveness of the compliance function in the business process of the BPR or BPRS;

c. improving financial performance, among others through increasing efficiency in the event that BPR and BPRS experience profitability problems; and/or
d. making additional cash capital contributions by shareholders in the event that BPR and BPRS experience capital problems.

5. Action plans and reports on the realization of action plans are submitted to the Financial Services Authority through the Financial Services Authority reporting system.

6. In the event that the Financial Services Authority reporting system as referred to in item 5 is not yet available, action plans and reports on the realization of action plans are submitted in the form of:
   a. electronic copy (softcopy) via official email; or b. printed copy (hardcopy), which are addressed to the Regional Office of the Financial Services Authority or the Local Office of the Financial Services Authority in accordance with the territory where the head office of the BPR and BPRS is located.

VI. REPORTING

1. BPR and BPRS submit reports on the results of their self-assessment of the Health Level of BPR and BPRS to the Financial Services Authority by referring to Appendix Part H for BPR and Appendix Part I for BPRS which are inseparable parts of this Financial Services Authority Circular at the latest on:
   a. July 31 for the Health Level Assessment of BPR and BPRS at the end of June position; and b. January 31 for the Health Level Assessment of BPR and BPRS at the end of December position.

2. The report as referred to in item 1 which has been approved by the Board of Directors and submitted to the Board of Commissioners is subsequently submitted to the Financial Services Authority through the Financial Services Authority reporting system.

3. Submission of reports to the Financial Services Authority as referred to in item 2 is done for the first time for the December 2022 report position.

4. BPR and BPRS prepare self-assessment reports on health levels in the form of text files (.txt) and supporting documents in portable document format (.pdf).

5. In the event that the submission deadline:
   a. risk profile report in accordance with the Financial Services Authority Regulation regarding the implementation of risk management for BPR or the Financial Services Authority Regulation regarding the implementation of risk management for BPRS; and b. governance implementation report in accordance with:

1. Financial Services Authority Regulation regarding the implementation of governance for BPR or Financial Services Authority Regulation regarding the implementation of governance for BPRS up to the December 2022 report position; and
2. POJK on BPR and BPRS Health Level starting from the December 2023 report position,
   falls on a Saturday, Sunday, or public holiday established by the Central Government and/or Regional Government, the submission deadline for the report is the next working day.

This copy is in accordance with the original
Director of Law 1
Legal Department signed
Mufli Asmawidjaja

VII. CLOSING

1. At the time this Financial Services Authority Circular takes effect, Financial Services Authority Circular Number 28/SEOJK.03/2019 regarding the Health Level Assessment System for Sharia Rural Financing Institutions is revoked and declared invalid as of December 1, 2023.

2. At the time this Financial Services Authority Circular takes effect, the implementation and submission regarding review and action plans and ongoing supervision as referred to in the Matrix for Determining Risk Levels in Appendix II of:
   a. Financial Services Authority Circular Number 1/SEOJK.03/2019 regarding the Implementation of Risk Management for Rural Banks; and b. Financial Services Authority Circular Number 10/SEOJK.03/2019 regarding the Implementation of Risk Management for Sharia Rural Financing Institutions, is revoked and declared invalid as of January 1, 2024.

3. The provisions in this Financial Services Authority Circular take effect as of the date of determination.

Determined in Jakarta on July 18, 2022
EXECUTIVE HEAD OF BANKING SUPERVISOR
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA, signed
HERU KRISTIYANA

APPENDIX
FINANCIAL SERVICES AUTHORITY CIRCULAR
REPUBLIC OF INDONESIA
NUMBER 11 /SEOJK.03/2022
REGARDING
ASSESSMENT OF THE HEALTH LEVEL OF RURAL BANKS AND SHARIA RURAL FINANCING INSTITUTIONS

Part A: Risk Profile Factor Ranking

Rank Explanation
Rank 1
(Very Low)
The risk profile of BPR and BPRS included in this rank generally has characteristics among others:
a. Considering the business activities conducted by BPR and BPRS, the likelihood of losses faced by BPR and BPRS from inherent risks is classified as very low during a certain period in the future. b. Minimum Risk Management Requirements (KPMR) are very adequate. In the event of minor weaknesses, such weaknesses can be ignored.

Rank 2
(Low)
The risk profile of BPR and BPRS included in this rank generally has characteristics among others:
a. Considering the business activities conducted by BPR and BPRS, the likelihood of losses faced by BPR and BPRS from inherent risks is classified as low during a certain period in the future. b. KPMR is adequate. In the event of minor weaknesses, such weaknesses need management attention.

Rank 3
(Medium)
The risk profile of BPR and BPRS included in this rank generally has characteristics among others:
a. Considering the business activities conducted by BPR and BPRS, the likelihood of losses faced by BPR and BPRS from inherent risks is classified as medium during a certain period in the future.

Rank Explanation b. KPMR is fairly adequate. Although minimum requirements are met, there are some weaknesses that require management attention and improvement.

Rank 4
(High)
The risk profile of BPR and BPRS included in this rank generally has characteristics among others:
a. Considering the business activities conducted by BPR and BPRS, the likelihood of losses faced by BPR and BPRS from inherent risks is classified as high during a certain period in the future. b. KPMR is less adequate. There are significant weaknesses in various aspects of risk management that require immediate corrective action.

Rank 5
(Very High)
The risk profile of BPR and BPRS included in this rank generally has characteristics among others:
a. Considering the business activities conducted by BPR and BPRS, the likelihood of losses faced by BPR and BPRS from inherent risks is classified as very high during a certain period in the future. b. KPMR is not adequate. There are significant weaknesses in various aspects of risk management whose resolution is beyond the capability of management.

The risk profile factor rank is the risk rank in accordance with the Financial Services Authority Circular regarding the implementation of risk management for BPR and the Financial Services Authority Circular regarding the implementation of risk management for BPRS.

Part B: Governance Factor Ranking

Rank Explanation
Rank 1 BPR and BPRS have very good governance implementation.
Rank 2 BPR and BPRS have good governance implementation.
Rank 3 BPR and BPRS have fairly good governance implementation.
Rank 4 BPR and BPRS have less good governance implementation.
Rank 5 BPR and BPRS have not good governance implementation.

The governance factor rank is the composite governance rank in accordance with the Financial Services Authority Circular regarding the implementation of governance for BPR and the Financial Services Authority Circular regarding the implementation of governance for BPRS.

Part C: Ranking of Profitability and Capital Component Factors for BPR

1. Return on Asset (ROA)
   ROA = Profit Before Tax / Average Total Assets

a. Profit Before Tax is profit before tax as recorded in the current year's income statement that has been annualized. Example: For June position, accumulated profit at June position is calculated by dividing by 6 and multiplying by 12. b. Average Total Assets is the sum of all total assets from the first month of the year position to the report month position divided by the number of report months. Total assets are total assets as recorded in the current year's balance sheet. Example: For June position, it is calculated by summing total assets from January to June position and dividing by 6.

Rank 1: ROA ≥ 2%
Rank 2: 1.5% ≤ ROA < 2%
Rank 3: 1% ≤ ROA < 1.5%
Rank 4: 0.5% ≤ ROA < 1%
Rank 5: ROA < 0.5%

2. Operating Expense to Operating Income Ratio (BOPO)
   BOPO = Operating Expenses / Operating Income

a. Operating Expenses are all expenses incurred for the main activities of BPR that have been annualized. Example: For June position, accumulated operating expenses at June position are calculated by dividing by 6 and multiplying by 12. b. Operating Income is all income resulting from the main activities of BPR that has been annualized. Example: For June position, accumulated operating income at June position is calculated by dividing by 6 and multiplying by 12.

Rank 1: BOPO ≤ 85%
Rank 2: 85% < BOPO ≤ 90%
Rank 3: 90% < BOPO ≤ 95%
Rank 4: 95% < BOPO ≤ 100%
Rank 5: BOPO > 100%

3. Net Interest Margin (NIM)
   NIM = Net Interest Income / Average Total Productive Assets

a. Net Interest Income is annualized interest income minus annualized interest expenses. Example: For June position, net interest income is accumulated interest income at June position calculated by dividing by 6 and multiplying by 12 minus accumulated interest expenses at June position calculated by dividing by 6 and multiplying by 12. b. Average Total Productive Assets is the sum of all total productive assets from the first month of the year position to the report month position divided by the number of report months. Total productive assets are the total of Bank Indonesia Certificates, placements in other banks, and loans granted. Example: For June position, it is calculated by summing total productive assets from January to June position and dividing by 6.

Rank 1: NIM ≥ 10%
Rank 2: 8% ≤ NIM < 10%
Rank 3: 6% ≤ NIM < 8%
Rank 4: 4% ≤ NIM < 6%
Rank 5: NIM < 4%

4. Minimum Capital Fulfillment Ratio (KPMM)
   KPMM = (Core Capital + Supplementary Capital) / Risk-Weighted Assets (ATMR)

Core capital, supplementary capital, and Risk-Weighted Assets (ATMR) refer to the Financial Services Authority Regulation regarding minimum capital provision requirements and minimum core capital fulfillment for BPR.

Rank 1: KPMM ≥ 15%
Rank 2: 13% ≤ KPMM < 15%
Rank 3: 12% ≤ KPMM < 13%
Rank 4: 8% ≤ KPMM < 12%
Rank 5: KPMM < 8%

5. Core Capital to Net Problematic Productive Assets Ratio (MIAPB)
   MIAPB = Core Capital / Problematic Productive Assets (neto)

a. Core capital refers to the Financial Services Authority Regulation regarding minimum capital provision requirements and minimum core capital fulfillment for BPR. b. Problematic productive assets (neto) are productive assets with less active, doubtful, and bad quality after being reduced by productive asset impairment provisions.

Rank 1: MIAPB ≥ 200%
Rank 2: 180% ≤ MIAPB < 200%
Rank 3: 150% ≤ MIAPB < 180%
Rank 4: 120% ≤ MIAPB < 150%
Rank 5: MIAPB < 120%

Part D: Ranking of Profitability and Capital Component Factors for BPRS

1. Return on Asset (ROA)
   ROA = Profit Before Tax / Average Total Assets

a. Profit Before Tax is profit before tax as recorded in the current year's income statement that has been annualized. Example: For June position, accumulated profit at June position is calculated by dividing by 6 and multiplying by 12. b. Average Total Assets is the sum of all total assets from the first month of the year position to the report month position divided by the number of report months. Total assets are total assets as recorded in the current year's balance sheet. Example: For June position, it is calculated by summing total assets from January to June position and dividing by 6.

Rank 1: ROA ≥ 2%
Rank 2: 1.5% ≤ ROA < 2%
Rank 3: 1% ≤ ROA < 1.5%
Rank 4: 0.5% ≤ ROA < 1%
Rank 5: ROA < 0.5%

2. Operating Expense to Operating Income Ratio (BOPO)
   BOPO = Operating Expenses / Operating Income

a. Operating expenses are profit-sharing expenses for investment fund owners and operating expenses, which have been annualized. Example: For June position, accumulated profit-sharing expenses for investment fund owners and operating expenses at June position are calculated by dividing by 6 and multiplying by 12. b. Operating Income is income from fund disbursement and other operating income, which has been annualized. Example: For June position, accumulated income from fund disbursement and other operating income at June position is calculated by dividing by 6 and multiplying by 12.

Rank 1: BOPO ≤ 85%
Rank 2: 85% < BOPO ≤ 90%
Rank 3: 90% < BOPO ≤ 95%
Rank 4: 95% < BOPO ≤ 100%
Rank 5: BOPO > 100%

3. Net Return (NI)
   NI = (Income from Fund Disbursement After Profit Sharing, Returns, and Bonuses) / Average Total Productive Assets

a. Income from Fund Disbursement After Profit Sharing, Returns, and Bonuses is annualized income from fund disbursement minus annualized profit-sharing, return, and bonus expenses. Example: For June position, income from fund disbursement after profit sharing, returns, and bonuses is accumulated income from fund disbursement at June position calculated by dividing by 6 and multiplying by 12 minus accumulated profit-sharing, return, and bonus expenses at June position calculated by dividing by 6 and multiplying by 12. b. Average Total Productive Assets is the sum of all total productive assets from the first month of the year position to the report month position divided by the number of report months. Total productive assets are the total of placements in Bank Indonesia, placements in other banks, and financing granted. Example: For June position, it is calculated by summing total productive assets from January to June position and dividing by 6.

Rank 1: NI ≥ 10%
Rank 2: 8% ≤ NI < 10%
Rank 3: 6% ≤ NI < 8%
Rank 4: 4% ≤ NI < 6%
Rank 5: NI < 4%

4. Minimum Capital Fulfillment Ratio (KPMM)
   KPMM = (Core Capital + Supplementary Capital) / Risk-Weighted Assets (ATMR)

Core capital, supplementary capital, and ATMR refer to the Financial Services Authority Regulation regarding minimum capital provision requirements and minimum core capital fulfillment for BPRS.

Rank 1: KPMM ≥ 15%
Rank 2: 13% ≤ KPMM < 15%
Rank 3: 12% ≤ KPMM < 13%
Rank 4: 8% ≤ KPMM < 12%
Rank 5: KPMM < 8%

5. Core Capital to Net Problematic Productive Assets Ratio (MIAPB)
   MIAPB = Core Capital / Problematic Productive Assets (neto)

a. Core capital refers to the Financial Services Authority Regulation regarding minimum capital provision requirements and minimum core capital fulfillment for BPRS. b. Problematic productive assets (neto) are productive assets with less active, doubtful, and bad quality after being reduced by productive asset impairment provisions.

Rank 1: MIAPB ≥ 200%
Rank 2: 180% ≤ MIAPB < 200%
Rank 3: 150% ≤ MIAPB < 180%
Rank 4: 120% ≤ MIAPB < 150%
Rank 5: MIAPB < 120%

Part E: Profitability Factor Rating

Rating	Factor Explanation
Rating 1	Profitability is very adequate, profit exceeds targets, and supports capital growth. BPRs and BPRSs included in Rating 1 meet all or most of the following example characteristics:<br>a. BPR and BPRS performance in generating profit (profitability) is very adequate;<br>b. the main source of profitability from core earnings is very dominant. Core earnings include all income derived from the main activities of BPRs and BPRSs;<br>c. components supporting core earnings are very stable; and/or<br>d. the ability of profit to increase capital and future profit prospects are very high.
Rating 2	Profitability is adequate, profit exceeds targets, and supports capital growth. BPRs and BPRSs included in Rating 2 meet all or most of the following example characteristics:<br>a. BPR and BPRS performance in generating profit (profitability) is adequate;<br>b. the main source of profitability from core earnings is dominant;<br>c. components supporting core earnings are stable; and/or<br>d. the ability of profit to increase capital and future profit prospects are high.
Rating 3	Profitability is fairly adequate, profit meets targets, although there is pressure on profit performance that may cause a decline in profit but still sufficiently supports the capital growth of BPRs and BPRSs. BPRs and BPRSs included in this Rating 3 meet all or most of the following example characteristics:<br>a. BPR and BPRS performance in generating profit (profitability) is fairly adequate;<br>b. the main source of profitability from core earnings is fairly dominant but there is a fairly large influence from non-core earnings;<br>c. components supporting core earnings are fairly stable; and/or<br>d. the ability of profit to increase capital and future profit prospects are fairly good.
Rating 4	Profitability is less adequate, profit does not meet targets, and is expected to remain in such conditions in the future, thus less supporting the capital growth and business continuity of BPRs and BPRSs. BPRs and BPRSs included in Rating 4 meet all or most of the following example characteristics:<br>a. BPR and BPRS performance in generating profit (profitability) is not adequate or BPRs and BPRSs incur losses;<br>b. the main source of profitability comes from non-core earnings;<br>c. components supporting core earnings are less stable; and/or<br>d. the ability of profit to increase capital and future profit prospects are less good or can even have a negative impact on the capital of BPRs and BPRSs.
Rating 5	Profitability is not adequate, profit does not meet targets and is unreliable, and immediately requires an improvement in profit performance to ensure the business continuity of BPRs and BPRSs. BPRs and BPRSs included in Rating 5 meet all or most of the following example characteristics:<br>a. BPRs and BPRSs incur significant losses;<br>b. the main source of profitability comes from non-core earnings;<br>c. components supporting core earnings are unstable; and/or<br>d. the losses of BPRs and BPRSs significantly affect capital.

Part F: Capital Factor Rating

Rating	Explanation
Rating 1	BPRs and BPRSs have very adequate quality and adequacy of capital relative to risk conditions, accompanied by very strong capital management according to the characteristics, business scale, and complexity of BPRs and BPRSs. BPRs and BPRSs included in Rating 1 meet all or most of the following example characteristics:<br>a. BPRs and BPRSs have a very adequate level of capital, are very capable of anticipating all risks faced, and support the expansion of BPR and BPRS business in the future;<br>b. the quality of capital components is generally very good, permanent, and able to absorb losses;<br>c. BPRs and BPRSs have conducted simulations of capital adequacy or resilience with results that can cover all risks faced very adequately;<br>d. BPRs and BPRSs have very good capital management and/or have a very good capital adequacy assessment process according to business strategy and objectives as well as the complexity and scale of BPRs and BPRSs; and/or<br>e. BPRs and BPRSs have very good access to capital sources and/or have capital support from shareholders.
Rating 2	BPRs and BPRSs have adequate quality and adequacy of capital relative to risk conditions, accompanied by strong capital management according to the characteristics, business scale, and complexity of BPRs and BPRSs. BPRs and BPRSs included in Rating 2 meet all or most of the following example characteristics:<br>a. BPRs and BPRSs have an adequate level of capital and can anticipate almost all risks faced;<br>b. the quality of capital components is generally good, permanent, and able to absorb losses;<br>c. BPRs and BPRSs have conducted simulations of capital adequacy or resilience with results that can cover all risks faced adequately;<br>d. BPRs and BPRSs have good capital management and/or have a good capital adequacy assessment process; and/or<br>e. BPRs and BPRSs have good access to capital sources and/or there is capital support from shareholders.
Rating 3	BPRs and BPRSs have fairly adequate quality and adequacy of capital relative to risk conditions, accompanied by fairly strong capital management according to the characteristics, business scale, and complexity of BPRs and BPRSs. BPRs and BPRSs included in Rating 3 meet all or most of the following example characteristics:<br>a. BPRs and BPRSs have a fairly adequate level of capital, and are fairly capable of anticipating risks faced;<br>b. the quality of capital components is generally fairly good, fairly permanent, and fairly able to absorb losses;<br>c. BPRs and BPRSs have conducted simulations of capital adequacy or resilience with results that can cover all risks faced fairly adequately;<br>d. BPRs and BPRSs have fairly good capital management and/or have a fairly good capital adequacy assessment process; and/or<br>e. BPRs and BPRSs have fairly good access to capital sources, however, support from shareholders requires realization time.
Rating 4	BPRs and BPRSs have less adequate quality and adequacy of capital relative to risk conditions, accompanied by weak capital management compared to the characteristics, business scale, and complexity of BPRs and BPRSs. BPRs and BPRSs included in Rating 4 meet all or most of the following example characteristics:<br>a. BPRs and BPRSs have a less adequate level of capital and cannot anticipate all risks faced;<br>b. the quality of capital components is generally less good, less permanent, and less able to absorb losses;<br>c. BPRs and BPRSs have conducted simulations of capital adequacy or resilience with results that are less able to cover all risks faced;<br>d. BPRs and BPRSs have less good capital management and/or have a less good capital adequacy assessment process; and/or<br>e. BPRs and BPRSs lack access to capital sources, and there is no support from shareholders.
Rating 5	BPRs and BPRSs have inadequate quality and adequacy of capital relative to risk conditions, accompanied by very weak capital management compared to the characteristics, business scale, and complexity of BPRs and BPRSs. BPRs and BPRSs included in Rating 5 meet all or most of the following example characteristics:<br>a. BPRs and BPRSs have an inadequate level of capital, so they must add capital to anticipate all risks faced under normal conditions and during crisis conditions;<br>b. the quality of capital instruments is generally not good, not permanent, and unable to absorb losses;<br>c. BPRs and BPRSs have conducted simulations of capital adequacy or resilience with results that cannot cover all risks faced;<br>d. BPRs and BPRSs have poor capital management and/or have a poor capital adequacy assessment process; and/or<br>e. BPRs and BPRSs do not have access to capital sources and there is no support from shareholders.

Part G: Composite Health Level Rating

Rating	Composite Value	Explanation
Rating 1	1.00 – 1.50	Composite Rating 1 (CR-1) reflects the condition of BPRs and BPRSs that are generally very healthy, thus assessed as very capable of facing significant negative impacts from changes in business conditions and other external factors. This is reflected in the assessment factor ratings, including risk profile, governance implementation, profitability, and capital, which are generally very good. If there are weaknesses from either internal or external sides, these weaknesses are generally not significant.
Rating 2	1.51 – 2.60	Composite Rating 2 (CR-2) reflects the condition of BPRs and BPRSs that are generally healthy, thus assessed as capable of facing significant negative impacts from changes in business conditions and other external factors. This is reflected in the assessment factor ratings, including risk profile, governance implementation, profitability, and capital, which are generally good. If there are weaknesses from either internal or external sides, these weaknesses are generally less significant.
Rating 3	2.61 – 3.40	Composite Rating 3 (CR-3) reflects the condition of BPRs and BPRSs that are generally fairly healthy, thus assessed as fairly capable of facing significant negative impacts from changes in business conditions and other external factors. This is reflected in the assessment factor ratings, including risk profile, governance implementation, profitability, and capital, which are generally fairly good. If there are weaknesses from either internal or external sides, these weaknesses are generally fairly significant, and if not addressed well by management, they can disrupt the business continuity of BPRs and BPRSs.
Rating 4	3.41 – 4.20	Composite Rating 4 (CR-4) reflects the condition of BPRs and BPRSs that are generally less healthy, thus assessed as less capable of facing significant negative impacts from changes in business conditions and other external factors. This is reflected in the assessment factor ratings, including risk profile, governance implementation, profitability, and capital, which are generally less good. There are weaknesses from either internal or external sides that are generally significant and cannot be addressed well by management, disrupting the business continuity of BPRs and BPRSs.
Rating 5	4.21 – 5.00	Composite Rating 5 (CR-5) reflects the condition of BPRs and BPRSs that are generally unhealthy, thus assessed as unable to face significant negative impacts from changes in business conditions and other external factors. This is reflected in the assessment factor ratings, including risk profile, governance implementation, profitability, and capital, which are generally not good. There are weaknesses from either internal or external sides that are generally very significant, so addressing them requires funding support from shareholders or funding sources from other parties to strengthen the financial condition of BPRs and BPRSs.

Part H: Self-Assessment Report Format for BPR Health Level

SELF-ASSESSMENT REPORT
HEALTH LEVEL

BPR Name :
Position :

Factor/Component	Assessment Position	Previous Report Position
	Ratio (%)	Rating (a)	Weight (b)	Factor Value (c)=(a)*(b)	Ratio (%)	Rating (a)	Weight (b)	Factor Value (c)=(a)*(b)
Risk Profile
Governance
*Profitability )
1. Return on Asset (ROA)
2. Operational Expense to Operational Income Ratio (BOPO)
3. Net Interest Margin (NIM)
*Capital )
1. Minimum Capital Requirement Liability Ratio (KPMM)
2. Core Capital to Net Productive Asset Ratio (MIAPB)
Composite Value (Sum of Factor Values)
Composite Rating

Report Position Analysis)

1. Health Level Conclusion
   …..
2. Risk Profile
   …..
3. Governance
   …..
4. Profitability
   …..
5. Capital
   …..

Notes:
*) The determination of profitability and capital factor ratings is done by considering quantitative and qualitative aspects.
) Report Position Analysis contains an analysis of the overall health level along with each assessment factor, considering the latest information on BPR conditions, main problems being faced, including inter-factor relationships.

Part I: Self-Assessment Report Format for BPRS Health Level

SELF-ASSESSMENT REPORT
HEALTH LEVEL

BPRS Name :
Position :

Factor/Component	Assessment Position	Previous Report Position
	Ratio (%)	Rating (a)	Weight (b)	Factor Value (c)=(a)*(b)	Ratio (%)	Rating (a)	Weight (b)	Factor Value (c)=(a)*(b)
Risk Profile
Governance
*Profitability )
1. Return on Asset (ROA)
2. Operational Expense to Operational Income Ratio (BOPO)
3. Net Yield (NI)
*Capital )
1. Minimum Capital Requirement Liability Ratio (KPMM)
2. Core Capital to Net Productive Asset Ratio (MIAPB)
Composite Value (Sum of Factor Values)
Composite Rating

Report Position Analysis)

1. Health Level Conclusion
   …..
2. Risk Profile
   …..
3. Governance
   …..
4. Profitability
   …..
5. Capital
   …..

Notes:
*) The determination of profitability and capital factor ratings is done by considering quantitative and qualitative aspects.
) Report Position Analysis contains an analysis of the overall health level along with each assessment factor, considering the latest information on BPRS conditions, main problems being faced, including inter-factor relationships.

This copy is consistent with the original
Legal Director 1
Legal Department signed
Mufli Asmawidjaja

Determined in Jakarta on July 18, 2022
EXECUTIVE HEAD OF BANKING SUPERVISOR
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA, signed
HERU KRISTIYANA