Regulation of the Financial Services Authority of the Republic of Indonesia Number 5 of 2024 Concerning the Determination of Supervisory Status and Handling of Issues of Commercial Banks

FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA
COPY
REGULATION OF THE FINANCIAL SERVICES AUTHORITY OF THE REPUBLIC OF INDONESIA NUMBER 5 OF 2024 CONCERNING THE DETERMINATION OF SUPERVISORY STATUS AND HANDLING OF ISSUES OF COMMERCIAL BANKS BY THE GRACE OF GOD THE ALMIGHTY THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY, Considering: that in order to implement the provisions of Article 36A and Article 37 paragraphs (4) and (6) of Law Number 7 of 1992 concerning Banking as amended several times, lastly with Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector, Article 54 paragraphs (4) and (6) of Law Number 21 of 2008 concerning Sharia Banking as amended with Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector, and Article 16A paragraph (8), Article 16C paragraph (10), Article 18A paragraph (4), Article 19 paragraph (4), Article 25 paragraph (11), Article 29A, and Article 31 of Law Number 9 of 2016 concerning the Prevention and Handling of Financial System Crises as amended with Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector, and in order to achieve a robust financial system stability through the development and strengthening of the financial sector in Indonesia, it is necessary to establish a Financial Services Authority Regulation concerning the Determination of Supervisory Status and Handling of Issues of Commercial Banks; Recalling: 1. Law Number 7 of 1992 concerning Banking (State Gazette of the Republic of Indonesia Year 1992 Number 31, Supplement to the State Gazette of the Republic of Indonesia Number 3472) as amended several times, lastly with Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (State Gazette of the Republic of Indonesia Year 2023 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6845);
2. Law Number 21 of 2008 concerning Sharia Banking (State Gazette of the Republic of Indonesia Year 2008 Number 94, Supplement to the State Gazette of the Republic of Indonesia Number 4867) as amended with Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (State Gazette of the Republic of Indonesia Year 2023 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6845);
3. Law Number 21 of 2011 concerning the Financial Services Authority (State Gazette of the Republic of Indonesia Year 2011 Number 111, Supplement to the State Gazette of the Republic of Indonesia Number 5253) as amended with Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (State Gazette of the Republic of Indonesia Year 2023 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6845);
4. Law Number 9 of 2016 concerning the Prevention and Handling of Financial System Crises (State Gazette of the Republic of Indonesia Year 2016 Number 70, Supplement to the State Gazette of the Republic of Indonesia Number 5872) as amended with Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (State Gazette of the Republic of Indonesia Year 2023 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6845);
5. Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (State Gazette of the Republic of Indonesia Year 2023 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6845);
DECIDING:
Decree: FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING THE DETERMINATION OF SUPERVISORY STATUS AND HANDLING OF ISSUES OF COMMERCIAL BANKS.

CHAPTER I
GENERAL PROVISIONS
Article 1
In this Financial Services Authority Regulation, the following terms are defined:

Commercial Bank, hereinafter referred to as Bank, is a bank that conducts business activities conventionally and/or based on Sharia principles, which in its activities provides services in payment circulation, including branch offices of banks located outside the country.
Branch Office of a Bank Located Outside the Country, hereinafter referred to as KCBLN, is a Bank that is a branch office of a bank with legal status and a head office located outside the country.
Systemic Bank is a Bank that, due to its asset size, capital, and liabilities; the breadth of its network or complexity of transactions for banking services; and its interconnection with other financial sectors, can cause the failure of part or all of other banks or financial service sectors, either operationally or financially, if such Bank experiences disturbance or failure.
General Meeting of Shareholders, hereinafter abbreviated as GMS, is the Bank organ that has authority not delegated to the Board of Directors or Board of Commissioners within the limits determined by laws concerning limited liability companies and/or the articles of association or an organ or party equivalent for KCBLN.
Board of Directors is the Bank organ authorized and fully responsible for the management of the Bank for the benefit of the Bank, in accordance with the purpose and objectives of the Bank and representing the Bank, both inside and outside court, in accordance with the articles of association provisions for Banks with limited liability company legal status, or the head of the branch office and one level below the head of the branch office for KCBLN.
Board of Commissioners is the Bank organ tasked with conducting general and/or specific supervision in accordance with the articles of association and providing advice to the Board of Directors for Banks with limited liability company legal status, or the party appointed to carry out supervisory functions for KCBLN.
Controlling Shareholder, hereinafter abbreviated as CSP, is a legal entity, individual, and/or business group that owns 25% (twenty-five percent) or more of the issued shares and has voting rights of the company or Bank, or owns less than 25% (twenty-five percent) of the issued shares and has voting rights but can be proven to have controlled the company or Bank, directly or indirectly.
Ultimate Controlling Shareholder, hereinafter abbreviated as UCS, is an individual or state that directly or indirectly owns shares of the company or Bank and is the ultimate controller or ultimate beneficial owner of a company, Bank, or business group.
Capital Surcharge is an additional capital capacity function intended to reduce negative impacts on financial system stability and the economy in the event of Systemic Bank failure by increasing the Systemic Bank's ability to absorb losses.
Recovery Action Plan is a plan to address potential financial problems that may occur in the Bank.
Minimum Reserve Requirement, hereinafter abbreviated as MRR, is the minimum reserve requirement as regulated in legislation concerning minimum reserve requirements.
Intermediary Bank is a commercial bank established by the Deposit Insurance Corporation for use as a resolution vehicle by accepting the transfer of part or all of the assets and/or liabilities of the bank handled by the Deposit Insurance Corporation, subsequently conducting banking business activities, and whose ownership will be transferred to another party.
Originating Bank is the bank handled by the Deposit Insurance Corporation whose part or all of assets and/or liabilities are transferred to the Intermediary Bank.
Bank Group based on Core Capital, hereinafter abbreviated as BGCC, is the grouping of banks based on the core capital owned, in accordance with Financial Services Authority Regulations concerning commercial banks and Financial Services Authority Regulations concerning Sharia commercial banks.
Financial Services Authority is an independent state institution that has the function, duties, and authority for regulation, supervision, examination, and investigation as referred to in laws concerning the Financial Services Authority.
Bank Indonesia is the Central Bank of the Republic of Indonesia as referred to in the 1945 Constitution of the Republic of Indonesia.
Deposit Insurance Corporation is the deposit insurance institution as referred to in laws concerning the Deposit Insurance Corporation.
Financial System Stability Committee is the financial system stability committee as referred to in laws concerning the prevention and handling of financial system crises and laws concerning the development and strengthening of the financial sector.

CHAPTER II
DETERMINATION OF SYSTEMIC BANKS AND CAPITAL SURCHARGE
Section One
General
Article 2
(1) The Financial Services Authority designates Systemic Banks after coordinating with Bank Indonesia and the Deposit Insurance Corporation.
(2) The Financial Services Authority coordinates with Bank Indonesia and the Deposit Insurance Corporation in updating the list of Systemic Banks.
(3) The updating of the Systemic Bank list as referred to in paragraph (2) is conducted periodically once every 6 (six) months on:
a. March, using data up to the position of December of the previous year; and b. September, using data up to the position of June of the current year.
(4) The Financial Services Authority submits the results of the designation of Systemic Banks as referred to in paragraph (1) and the updating of the Systemic Bank list as referred to in paragraph (2) to the Financial System Stability Committee.

Article 3
(1) The Financial Services Authority sends written notification to Banks designated as Systemic Banks and the formation of Capital Surcharge for Systemic Banks.
(2) The validity period of the designation of Systemic Banks and the formation of Capital Surcharge as referred to in paragraph (1):
a. for the March designation period, is valid from April to September of the current year; and b. for the September designation period, is valid from October of the current year to March of the following year.

Section Two
Methodology for Determining Systemic Banks
Article 4
(1) In designating Systemic Banks as referred to in Article 2, the Financial Services Authority compiles the methodology for determining Systemic Banks.
(2) The methodology for determining Systemic Banks as referred to in paragraph (1) uses indicators:
a. Bank size (size); b. business activity complexity (complexity); and
c. interconnection with the financial system (interconnectedness).
(3) The methodology for determining Systemic Banks as referred to in paragraph (1) is used in the designation of Systemic Banks and the periodic updating of the Systemic Bank list once every 6 (six) months as referred to in Article 2 paragraph (3). (4) The Financial Services Authority reviews the methodology for determining Systemic Banks as referred to in paragraph (1) at least once every 3 (three) years.

Article 5
(1) Bank size (size) as referred to in Article 4 paragraph (2) letter a is measured from the Bank's total exposure.
(2) The Bank's total exposure as referred to in paragraph (1) is the sum of:
a. on-balance sheet exposure; b. off-balance sheet exposure; and
c. potential future exposure from derivative transactions.

Article 6
Business activity complexity (complexity) as referred to in Article 4 paragraph (2) letter b has sub-indicators consisting of:
a. notional value of spot and over-the-counter derivatives; b. securities with measurement categories:

fair value through profit or loss; and
fair value through other comprehensive income;
c. domestic-specific indicators established by the Financial Services Authority, at least covering:
outstanding value of bank guarantees;
outstanding value of irrevocable letters of credit;
book value of portfolios of government securities and/or state Sharia securities owned;
number of third-party fund accounts;
number of credit accounts or financing accounts; and
number of domestic and foreign branch offices; and
d. substitutability of the Bank's role in payment system activities and custody.

Article 7
Interconnection with the financial system (interconnectedness) as referred to in Article 4 paragraph (2) letter c has sub-indicators at least covering:
a. financial assets in the form of claims or placements with financial service institutions (intra-financial system assets); b. financial liabilities to financial service institutions (intra-financial system liabilities);
c. book value of securities issued by the Bank (securities outstanding); and
d. interbank transaction interconnection in the money market (network analysis of the interbank system).

Article 8
Based on the indicators as referred to in Article 4 paragraph (2), the Financial Services Authority calculates the Bank's systemic importance score and establishes a threshold as the basis for designating Systemic Banks.

Section Three
Capital Surcharge
Article 9
(1) The Financial Services Authority establishes Capital Surcharge in 5 (five) groups (buckets).
(2) The amount of Capital Surcharge in each group (bucket) is established:
a. 1.0% (one point zero percent) of risk-weighted assets for Systemic Banks classified in group (bucket) 1 (one); b. 1.5% (one point five percent) of risk-weighted assets for Systemic Banks classified in group (bucket) 2 (two);
c. 2.0% (two point zero percent) of risk-weighted assets for Systemic Banks classified in group (bucket) 3 (three);
d. 2.5% (two point five percent) of risk-weighted assets for Systemic Banks classified in group (bucket) 4 (four); and e. 3.5% (three point five percent) of risk-weighted assets for Systemic Banks classified in group (bucket) 5 (five).

Article 10
(1) The Financial Services Authority establishes the grouping of Systemic Banks based on the systemic importance score into group (bucket) 1 (one) through group (bucket) 4 (four). (2) In the event that there is a Bank with a systemic importance score that cannot be classified into group (bucket) 1 (one) through group (bucket) 4 (four), the Financial Services Authority establishes:
a. such Systemic Bank into group (bucket) 5 (five); and b. the formation of 1 (one) group (bucket) above group (bucket) 5 (five).
(3) The Financial Services Authority establishes 1 (one) higher group (bucket) each time there is a Systemic Bank established in the highest previous group (bucket).
(4) For each addition of 1 (one) group (bucket) as referred to in paragraph (2) and paragraph (3), the amount of Capital Surcharge as referred to in Article 9 paragraph (2) is established to increase by 1% (one percent) of risk-weighted assets.

Article 11
(1) Systemic Banks are required to form Capital Surcharge in accordance with the amount of Capital Surcharge established as referred to in Article 9 paragraph (2) and Article 10 paragraph (4). (2) Capital Surcharge as referred to in paragraph (1) must be fulfilled by Systemic Banks using common equity tier 1 capital. (3) The Financial Services Authority may review and adjust the establishment of the amount and timing of fulfillment of Capital Surcharge, considering economic conditions and financial system stability.

Article 12
(1) Banks that, at the time of designation as Systemic Banks, cannot fulfill the obligation to fulfill Capital Surcharge as referred to in Article 11, are required to submit a Capital Surcharge fulfillment plan to the Financial Services Authority at the latest 14 (fourteen) working days since the written notification as referred to in Article 3 paragraph (1). (2) The Capital Surcharge fulfillment plan as referred to in paragraph (1) is submitted to the Financial Services Authority online through the Financial Services Authority reporting system in accordance with the procedures set forth in the Financial Services Authority Regulation concerning bank reporting through the Financial Services Authority reporting system. (3) In the event that the Financial Services Authority reporting system as referred to in paragraph (2) is not yet available or there is a force majeure situation, submission is conducted through the Financial Services Authority correspondence system. (4) In the event that the Financial Services Authority correspondence system as referred to in paragraph (3) is not yet available or there is a force majeure situation, submission is conducted offline to the Financial Services Authority. (5) Submission through the Financial Services Authority correspondence system as referred to in paragraph (3) or offline as referred to in paragraph (4) is addressed to:
a. the Department of Supervision of the Relevant Bank or the Financial Services Authority Office in Jakarta, for Banks with headquarters or domicile in the Special Capital Region of Jakarta and Banten Province; or b. the local Financial Services Authority Office, for Banks with headquarters or domicile outside the Special Capital Region of Jakarta and Banten Province.

Section Four
Sanctions
Article 13
(1) Systemic Banks that violate the provisions as referred to in Article 11 paragraph (1) and/or Article 12 paragraph (1) are subject to administrative sanctions in the form of written reprimands. (2) Systemic Banks that are late in fulfilling the obligation to submit the Capital Surcharge fulfillment plan as referred to in Article 12 paragraph (1) are subject to administrative sanctions in the form of a fine of IDR 2,000,000.00 (two million rupiah) per working day and at most IDR 200,000,000.00 (two hundred million rupiah). (3) Banks that have been subject to administrative sanctions in the form of fines as referred to in paragraph (2) remain obligated to submit the Capital Surcharge fulfillment plan to the Financial Services Authority. (4) In the event that a Systemic Bank has been subject to administrative sanctions as referred to in paragraph (1) and/or paragraph (2), and continues to violate the provisions as referred to in Article 11 paragraph (1), Article 12 paragraph (1), and/or paragraph (3), the Systemic Bank is subject to administrative sanctions in the form of:
a. prohibition on issuing new products; b. suspension of certain business activities;
c. prohibition on expanding business activities;
d. prohibition on conducting new business activities; and/or e. downgrade of the Systemic Bank's health rating.
(5) In the event that a Systemic Bank has been subject to administrative sanctions as referred to in paragraph (1), paragraph (2), and/or paragraph (4), the main parties of the Systemic Bank may be subject to administrative sanctions in the form of prohibition as a main party in accordance with the Financial Services Authority Regulation concerning re-evaluation of main parties of financial service institutions. (6) The imposition of administrative sanctions as referred to in paragraph (1) through paragraph (5) does not eliminate the imposition of other sanctions in accordance with legislation.

CHAPTER III
RECOVERY ACTION PLAN
Section One
General
Article 14
(1) Banks are required to compile and submit a Recovery Action Plan to the Financial Services Authority.
(2) Banks in the Deposit Insurance Corporation's resolution actions are exempt from the obligation to compile and submit a Recovery Action Plan as referred to in paragraph (1).

Article 15
(1) The Recovery Action Plan as referred to in Article 14 paragraph (1) must obtain approval from shareholders in the GMS.
(2) In the event that the Recovery Action Plan submitted to the Financial Services Authority has not obtained shareholder approval in the GMS as referred to in paragraph (1), the Bank is required to request approval of the Recovery Action Plan at the next GMS.

Article 16
(1) Submission of the Recovery Action Plan to the Financial Services Authority as referred to in Article 14 paragraph (1) must be signed by the Chief Director, Chief Commissioner, and CSP. (2) For Banks conducting business activities based on Sharia principles and Banks conducting conventional business activities that have Sharia business units, the signing as referred to in paragraph (1) must first obtain an opinion from the Sharia Supervisory Board. (3) The opinion of the Sharia Supervisory Board as referred to in paragraph (2) is included in the Recovery Action Plan submitted by the Bank.

Article 17
The Board of Directors is required to:
a. compile a realistic and comprehensive Recovery Action Plan; b. submit the Recovery Action Plan to shareholders at the GMS for approval;
c. communicate the Recovery Action Plan to all levels or tiers of the Bank's organization;
d. conduct evaluation and testing (stress testing) of the Recovery Action Plan periodically; and e. implement the Recovery Action Plan effectively and on time.

Article 18
(1) The Recovery Action Plan as referred to in Article 14 paragraph (1) must obtain approval from the Board of Commissioners.
(2) The Board of Commissioners is required to conduct:
a. supervision of the implementation of the Recovery Action Plan; and b. evaluation of the implementation of the Recovery Action Plan.

Section Two
Guidelines for Recovery Action Plan
Article 19
(1) Banks must have Recovery Action Plan guidelines that at least contain:
a. parties involved and responsible for:

compiling the Recovery Action Plan;
submitting the Recovery Action Plan; and
communicating the Recovery Action Plan to all levels or tiers of the Bank's organization;
b. parties involved and responsible for conducting evaluation and testing (stress testing) of the Recovery Action Plan; and
c. parties involved and responsible for the implementation of the Recovery Action Plan.
(2) To support the implementation of the Recovery Action Plan as referred to in paragraph (1) letter c, the Recovery Action Plan guidelines at least contain:
a. procedures to ensure timely implementation of the Recovery Action Plan; and b. decision-making procedures and escalation procedures in decision-making.
(3) Banks may form a crisis management group to implement the Recovery Action Plan.
(4) The crisis management group as referred to in paragraph (3) is equipped with guidelines that at least contain procedures as referred to in paragraph (2).

Article 20
The Recovery Action Plan guidelines as referred to in Article 19 are compiled by applying good corporate governance in the Bank.

Article 21
Banks are required to develop a reliable management information system to support evaluation and testing (stress testing), as well as the implementation of the Recovery Action Plan.

Section Three
Scope of Recovery Action Plan
Paragraph 1
General
Article 22
The Recovery Action Plan as referred to in Article 14 paragraph (1) at least contains:
a. executive summary; b. general description of the Bank;
c. recovery options; and
d. disclosure of the Recovery Action Plan.

Paragraph 2
Executive Summary
Article 23
The executive summary as referred to in Article 22 letter a at least contains a summary regarding:
a. general description of the Bank; b. recovery options; and
c. disclosure of the Recovery Action Plan.

Paragraph 3
General Overview of Banks
Article 24
The general overview of Banks as referred to in Article 22 letter b shall at least contain:
a. the condition of the Bank; b. material business lines, office networks, and subsidiary companies of the Bank;
c. the business group structure of the Bank;
d. business linkages of the Bank; and e. scenario analysis of the impact of changes in the Bank's conditions.

Article 25
The condition of the Bank as referred to in Article 24 letter a shall at least contain:
a. ownership; b. business aspects and performance;
c. business plans;
d. risk management strategies; e. office networks; and f. subsidiary companies.

Article 26
(1) Material business lines, office networks, and subsidiary companies of the Bank as referred to in Article 24 letter b shall elaborate on business lines, office networks, and subsidiary companies of the Bank that have criteria including:
a. contributing significantly to profit achievement activities, fund collection, and fund disbursement, including to the Bank's financial performance; b. bearing large risks in worst-case scenarios that can endanger the Bank's business continuity individually and on a consolidated basis;
c. cannot be dissolved or closed without triggering large risks to the Bank;
d. playing an important role in the financial stability of the Bank; and/or e. conducting operational activities and risk management activities that directly support the implementation of business functions, including operational linkages to a function with other functions within the Bank. (2) Banks must disclose the material criteria of business lines, office networks, and subsidiary companies of the Bank as referred to in paragraph (1).

Article 27
The business group structure of the Bank as referred to in Article 24 letter c shall elaborate on the business structure related to the Bank, Parent Banks (PSP) up to Parent Commercial Banks (PSPT), and related companies (sister companies).

Article 28
(1) Business linkages of the Bank as referred to in Article 24 letter b include:
a. material intra-group business linkages; and b. material external business linkages.
(2) Material intra-group business linkages of the Bank as referred to in paragraph (1) letter a shall at least elaborate on financial relationships, equity participation, and intra-group financial support agreements. (3) Material external business linkages of the Bank as referred to in paragraph (1) letter b shall at least elaborate on exposures, obligations, products, and/or services that are significant to main business partners. (4) Banks must disclose the material criteria of business linkages of the Bank as referred to in paragraph (1).

Article 29
Scenario analysis of the impact of changes in the Bank's conditions as referred to in Article 24 letter e includes scenario analysis against stress conditions occurring in the Bank:
a. individually (idiosyncratic); and b. externally occurring in the financial market as a whole, which can be domestic or international (market-wide shock), at least against capital, liquidity, profitability, and asset quality conditions.

Paragraph 4
Recovery Options
Article 30
(1) Banks are required to formulate and determine recovery options as referred to in Article 22 letter c in detail, accompanied by realistic implementation steps.
(2) The determination of recovery options as referred to in paragraph (1) is based on:
a. indicators used in the Recovery Action Plan; and b. trigger levels for each indicator used in the Recovery Action Plan as referred to in letter a, to activate the implementation of the Recovery Action Plan.

Article 31
(1) In formulating and determining recovery options as referred to in Article 30 paragraph (1), Banks are required to determine indicators used in the Recovery Action Plan as referred to in Article 30 paragraph (2) letter a, which include:
a. capital; b. liquidity;
c. profitability; and
d. asset quality.
(2) Capital indicators as referred to in paragraph (1) letter a shall at least consist of:
a. minimum capital provision ratio; and b. common equity tier 1 ratio.
(3) Liquidity indicators as referred to in paragraph (1) letter b shall at least consist of:
a. IDR Gross Working Capital ratio; b. liquidity coverage ratio; and
c. net stable funding ratio.
(4) Profitability indicators as referred to in paragraph (1) letter c shall at least consist of:
a. return on asset (ROA) ratio; b. return on equity (ROE) ratio; and
c. operational expense to operational income ratio (BOPO).
(5) Asset quality indicators as referred to in paragraph (1) letter d shall at least consist of:
a. gross non-performing loan (NPL) ratio or gross non-performing financing (NPF) ratio; and b. net non-performing loan (NPL) ratio or net non-performing financing (NPF) ratio. (6) In the event that there are no other liquidity indicators other than the IDR Gross Working Capital ratio, liquidity indicators for Banks conducting business activities based on Sharia principles shall at least be the IDR Gross Working Capital ratio as referred to in paragraph (3) letter a.

Article 32
(1) In addition to indicators used in the Action Plan as referred to in Article 31, Banks may determine other quantitative indicators and/or qualitative indicators, which in the Bank's assessment can cause significant problems to the Bank's financial conditions. (2) Banks determine recovery options for other quantitative indicators and/or qualitative indicators as referred to in paragraph (1).

Article 33
(1) Banks determine trigger levels for each indicator as referred to in Article 30 paragraph (2) letter b, to implement recovery options.
(2) In the event that there are provisions of legislation regarding capital, liquidity, profitability, and/or asset quality indicators, Banks are required to determine trigger levels guided by the provisions of the legislation. (3) Trigger levels determined as referred to in paragraph (1) must include the implementation of the Recovery Action Plan for the purpose of:
a. prevention, so that the Bank can still maintain the same or better size or ratio than the provisions of the legislation; b. recovery, so that the Bank no longer violates the size or ratio of indicators in accordance with the provisions of the legislation; and
c. improvement, from conditions endangering the Bank's business continuity.

Article 34
(1) Banks in formulating and determining recovery options as referred to in Article 30 paragraph (1) must be accompanied by:
a. the order of recovery option implementation choices, in the event of conditions requiring the Bank to implement recovery options; b. analysis or feasibility assessment of each recovery option;
c. analysis or assessment of the impact of each recovery option; and
d. analysis or assessment of the expected time frame for the implementation and effectiveness of each recovery option.
(2) The analysis or feasibility assessment of each recovery option as referred to in paragraph (1) letter b shall at least contain:
a. risk assessment related to the recovery option, based on experience in implementing the recovery option or other relevant measures; b. analysis regarding material obstacles in the timely implementation of the recovery option and an explanation of how to overcome the obstacles; and
c. assessment of the adequacy of operational support for each recovery option.

Article 35
(1) In determining recovery options for capital problems as referred to in Article 31 paragraph (1) letter a, in addition to other recovery options to address capital problems, Banks are required to determine recovery options in the form of:
a. capital addition of the Bank that becomes the obligation of the Parent Bank (PSP) and/or Parent Commercial Bank (PSPT); b. changing the type of certain obligations into Bank capital, which:

becomes the obligation of the PSP and/or PSPT; and/or
involves other parties; and
c. capital addition of the Bank involving other parties.
(2) The type of certain obligations as referred to in paragraph (1) letter b numbers 1 and 2 includes:
a. deposits; and/or b. debt instruments or investments that have capital characteristics, which can be converted into capital in the Bank.
(3) The obligation to change the type of certain obligations into Bank capital by the PSP and/or PSPT as referred to in paragraph (1) letter b number 1 is carried out by:
a. converting deposits and/or debt instruments or investments that have capital characteristics owned by the PSP and/or PSPT into common shares; and/or b. write-down of deposits and/or debt instruments or investments that have capital characteristics owned by the PSP and/or PSPT. (4) The obligation to change certain obligations into Bank capital involving other parties as referred to in paragraph (1) letter b number 2 is carried out by:
a. converting deposits and/or debt instruments or investments that have capital characteristics owned by other parties into common shares; and b. write-down of deposits and/or debt instruments or investments that have capital characteristics owned by other parties. (5) Banks must first implement recovery options in the form of capital increase that becomes the obligation of the PSP and/or PSPT.

Article 36
(1) In the implementation of recovery options in the form of obligations to change the type of certain obligations into Bank capital by the PSP and/or PSPT as referred to in Article 35 paragraph (3), Banks are required to have:
a. deposits owned by the PSP and/or PSPT in the form of time deposits under the name "Commissioners Board of the Financial Services Authority qq. PSP and/or PSPT" in the Bank, with a note that disbursement is carried out with written approval from the Financial Services Authority; and/or b. debt instruments or investments that have capital characteristics owned by the PSP and/or PSPT. (2) In the implementation of recovery options in the form of obligations to change the type of certain obligations into Bank capital involving other parties as referred to in Article 35 paragraph (4), Banks are required to have:
a. deposits owned by affiliated parties of the PSP and/or PSPT in the form of time deposits under the name "Commissioners Board of the Financial Services Authority qq. affiliated parties of the PSP and/or PSPT" in the Bank, with a note that disbursement is carried out with written approval from the Financial Services Authority; and/or b. debt instruments or investments that have capital characteristics owned by other parties. (3) Debt instruments or investments that have capital characteristics owned by other parties as referred to in paragraph (2) letter b are prohibited from being owned by individual parties or investors. (4) The determination of the amount of deposits and/or debt instruments or investments that have capital characteristics, owned by the PSP and/or PSPT, and/or owned by other parties, held by the Bank as referred to in paragraph (1) and paragraph (2) shall at least consider:
a. the Bank's capital resilience based on scenario analysis of the impact of changes in the Bank's conditions individually (idiosyncratic) and the Bank's conditions externally occurring in the financial market as a whole, which can be domestic or international (market-wide shock); and b. the impact of issuing debt instruments or investments that have capital characteristics on profitability. (5) In the event of disbursement of deposits in the form of time deposits owned by:
a. the PSP and/or PSPT as referred to in paragraph (1) letter a; and/or b. affiliated parties of the PSP and/or PSPT as referred to in paragraph (2) letter a, in relation to the PSP and/or PSPT no longer being the PSP and/or PSPT of the Bank, the Financial Services Authority is authorized to determine the fulfillment of deposit ownership.

Article 37
(1) Implementation:
a. conversion and/or write-down of debt instruments or investments that have capital characteristics as referred to in Article 35 paragraph (3) and paragraph (4); and b. fulfillment of debt instruments or investments in the Bank that can be converted into capital as referred to in Article 36 paragraph (1) letter b and paragraph (2) letter b, is carried out in accordance with the provisions of the Financial Services Authority regarding conversion features into common shares or write-down against additional core capital and supplementary capital instruments. (2) Implementation of conversion and/or write-down of deposits as referred to in Article 35 paragraph (3) and paragraph (4) is carried out in accordance with the provisions of the Financial Services Authority regarding conversion features into common shares or write-down against additional core capital and supplementary capital instruments.

Article 38
In determining recovery options for liquidity problems as referred to in Article 31 paragraph (1) letter b, Banks determine recovery options in the form of:
a. applying for short-term liquidity loans or short-term Sharia-based liquidity financing to Bank Indonesia; b. applying for fund placement requests to the Deposit Insurance Corporation; and/or
c. other recovery options.

Article 39
In determining recovery options for profitability problems as referred to in Article 31 paragraph (1) letter c, Banks determine recovery options in the form of:
a. cost efficiency programs; b. sale of fixed assets; and/or
c. other recovery options.

Article 40
In determining recovery options for asset quality problems as referred to in Article 31 paragraph (1) letter d, Banks determine recovery options in the form of:
a. credit restructuring; b. write-off of productive assets; and/or
c. other recovery options.

Paragraph 5
Disclosure of Recovery Action Plans
Article 41
(1) Disclosure of Recovery Action Plans as referred to in Article 22 letter d shall be submitted to:
a. internal parties; and b. external parties.
(2) Disclosure of Recovery Action Plans to internal and external parties as referred to in paragraph (1) shall contain a general overview regarding:
a. actions to be taken by the Bank to address financial problems that will occur in the Bank; and b. management mechanisms for potential negative market reactions when the Recovery Action Plan is implemented.

Part Four
Evaluation and Testing, Updating, and Implementation of Recovery Action Plans
Article 42
(1) The Board of Directors is required to conduct evaluation and testing (stress testing) of the Recovery Action Plan as referred to in Article 14 paragraph (1) periodically to assess the feasibility of the Recovery Action Plan. (2) Evaluation and testing (stress testing) of the Recovery Action Plan as referred to in paragraph (1) is carried out periodically at least once (1) in one (1) year. (3) In the event that there are specific conditions that will significantly affect the Bank, the Bank conducts evaluation and testing (stress testing) of the Recovery Action Plan outside the period as referred to in paragraph (2). (4) The determination of specific conditions that will significantly affect the Bank as referred to in paragraph (3) is carried out based on the Bank's assessment or the assessment of the Financial Services Authority. (5) The results of evaluation and testing (stress testing) of the Recovery Action Plan as referred to in paragraph (2) and paragraph (3) are reported by the Board of Directors to the Board of Commissioners.

Article 43
(1) Banks are required to update the Recovery Action Plan as referred to in Article 14 paragraph (1) periodically at least once (1) in one (1) year.
(2) In the event that the update of the Recovery Action Plan as referred to in paragraph (1) contains changes:
a. trigger levels; b. recovery options; and/or
c. fulfillment of the adequacy and feasibility of deposits and/or debt instruments or investments that have capital characteristics owned by the Bank,
the update of the Recovery Action Plan must obtain shareholder approval in the Annual General Meeting of Shareholders (AGMS).
(3) In the event that the update of the Recovery Action Plan as referred to in paragraph (2) is submitted to the Financial Services Authority without obtaining approval in the AGMS, the Bank is required to request approval of the Recovery Action Plan in the next AGMS.

Article 44
Banks are required to implement the Recovery Action Plan as referred to in Article 14 paragraph (1) when the trigger levels determined by the Bank as referred to in Article 33 paragraph (3) are met.

Article 45
In the event that the Bank has implemented the Recovery Action Plan but the Bank's conditions do not show improvement, the Financial Services Authority may determine other actions in accordance with the provisions of the legislation.

Part Five
Submission of Recovery Action Plans
Article 46
(1) For Banks that have conducted business activities before December 31, 2023, and are first subject to the obligation to formulate and submit Recovery Action Plans to the Financial Services Authority as referred to in Article 14 paragraph (1), are required to formulate and submit the Recovery Action Plan to the Financial Services Authority no later than the end of November 2024. (2) For Banks that have conducted business activities since December 31, 2023, are required to formulate and submit the Recovery Action Plan to the Financial Services Authority as referred to in Article 14 paragraph (1) for the first time no later than the end of November after one (1) year since the Bank has conducted business activities. (3) In the event that the Bank has formulated and submitted the Recovery Action Plan and the update of the Recovery Action Plan before this Financial Services Authority Regulation comes into force, the Bank is required to submit the update of the Recovery Action Plan as referred to in Article 43 paragraph (1).

Article 47
(1) Banks are required to submit the update of the Recovery Action Plan as referred to in Article 43 to the Financial Services Authority no later than:
a. the end of November for periodic updates of the Recovery Action Plan; and/or b. one (1) month after the evaluation and testing (stress testing) of the Recovery Action Plan based on specific conditions that will significantly affect the Bank. (2) The submission of the update of the Recovery Action Plan as referred to in paragraph (1) is accompanied by the results of evaluation and testing (stress testing) as referred to in Article 42, which contain:
a. feasibility of trigger levels; b. feasibility of recovery options; and
c. fulfillment of the adequacy and feasibility of deposits and/or debt instruments or investments that have capital characteristics owned by the Bank.
(3) The submission of the update of the Recovery Action Plan as referred to in paragraph (1) must be signed by the Chief Director and Chief Commissioner.
(4) In the event that the update of the Recovery Action Plan includes changes:
a. trigger levels; b. recovery options; and/or
c. fulfillment of the adequacy and feasibility of deposits and/or debt instruments or investments that have capital characteristics owned by the Bank,
the submission of the update of the Recovery Action Plan as referred to in paragraph (1) must be signed by the Chief Director, Chief Commissioner, and the Parent Bank (PSP).

Article 48
(1) The Financial Services Authority provides approval or rejection of the completeness of the Recovery Action Plan submitted by the Bank.
(2) In the event that based on the assessment by the Financial Services Authority, the Recovery Action Plan submitted by the Bank as referred to in paragraph (1) is incomplete, the Bank is required to correct the Recovery Action Plan and submit it to the Financial Services Authority no later than 10 (ten) working days from the date of the request for correction of the Recovery Action Plan from the Financial Services Authority. (3) Banks are required to submit the approved Recovery Action Plan to the Deposit Insurance Corporation in accordance with the provisions of the legislation.

Article 49
(1) Submission of the Recovery Action Plan and the update of the Recovery Action Plan is submitted to the Financial Services Authority online through the Financial Services Authority reporting system in accordance with the procedures set forth in the Financial Services Authority Regulation regarding bank reporting through the Financial Services Authority reporting system. (2) In the event that the submission deadline for the Recovery Action Plan falls on a holiday, the submission of the Recovery Action Plan is no later than the next working day. (3) In the event that the Financial Services Authority reporting system as referred to in paragraph (1) is not yet available or there is a force majeure situation, submission is carried out through the Financial Services Authority correspondence system. (4) In the event that the Financial Services Authority correspondence system as referred to in paragraph (3) is not yet available or there is a force majeure situation, submission is carried out offline to the Financial Services Authority. (5) Submission through the Financial Services Authority correspondence system as referred to in paragraph (3) or offline as referred to in paragraph (4) is addressed to:
a. the Department of Supervision of the relevant Bank or the Financial Services Authority Office in Jakarta, for Banks with their headquarters or domicile in the Special Capital Region of Jakarta Province and Banten Province; or b. the local Financial Services Authority Office, for Banks with their headquarters or domicile outside the Special Capital Region of Jakarta Province and Banten Province.

Part Six
Fulfillment of Deposit Ownership Obligations and Debt Instruments or Investments that Have Capital Characteristics
Article 50
(1) For Banks that have conducted business activities before December 31, 2023, which are first subject to the obligation to formulate and submit Recovery Action Plans as referred to in Article 46 paragraph (1), are required to fulfill the ownership of deposits and/or debt instruments or investments that have capital characteristics, owned by the Parent Bank (PSP) and/or Parent Commercial Bank (PSPT), and/or owned by other parties as referred to in Article 36, for:
a. Banks other than Large Systemically Important Banks (KCBLN) in Capital Base Group (KBMI) 3, no later than December 31, 2025; b. Banks other than Large Systemically Important Banks (KCBLN) in Capital Base Group (KBMI) 2, no later than December 31, 2026; and
c. Banks other than Large Systemically Important Banks (KCBLN) in Capital Base Group (KBMI) 1, no later than December 31, 2027.
(2) The determination of Capital Base Groups (KBMI) as referred to in paragraph (1) is based on the core capital owned by Banks other than Large Systemically Important Banks (KCBLN) as of December 31, 2023. (3) For Banks that have conducted business activities since December 31, 2023, the fulfillment of the obligation to have deposits and/or debt instruments or investments that have capital characteristics, owned by the Parent Bank (PSP) and/or Parent Commercial Bank (PSPT), and/or owned by other parties as referred to in Article 36, must be fulfilled within two (2) years since the submission of the Recovery Action Plan as referred to in Article 46 paragraph (2).

Part Seven
Recovery Action Plans for Large Systemically Important Banks (KCBLN)
Article 51
Regulations related to Recovery Action Plans as referred to in Article 14 to Article 50, for Large Systemically Important Banks (KCBLN), apply special regulations regarding:
a. the implementation of the functions of the Board of Directors, Board of Commissioners, Annual General Meeting of Shareholders (AGMS), and Parent Bank (PSP) adjusted to the organization applicable to KCBLN; b. the fulfillment of the obligation to determine recovery options for capital problems as referred to in Article 31 paragraph (1) letter a, is fulfilled with deposits owned by the head office of the KCBLN placed in financial assets other than those already stated or declared as capital (declared business funds); and
c. the fulfillment of obligations as referred to in letter b must be fulfilled no later than December 31, 2025.

Part Eight
Determination of Minimum Fulfillment of Deposit Ownership Obligations and Debt Instruments or Investments that Have Capital Characteristics
Article 52
The Financial Services Authority, with certain considerations, may determine to Banks the minimum ownership of the type of certain obligations converted into Bank capital as referred to in Article 35 and the minimum fulfillment of deposits owned by the head office of Large Systemically Important Banks (KCBLN) as referred to in Article 51 letter b.

Part Nine
Sanctions
Article 53
(1) Banks that violate the provisions as referred to in Article 14 paragraph (1), Article 15, Article 16 paragraph (1), paragraph (2), Article 18 paragraph (1), Article 21, Article 30 paragraph (1), Article 31 paragraph (1), Article 33 paragraph (2), paragraph (3), Article 34 paragraph (1), Article 35 paragraph (1), paragraph (5), Article 36 paragraph (1), paragraph (2), paragraph (3), Article 43, Article 44, Article 46, Article 47 paragraph (1), paragraph (3), paragraph (4), Article 48 paragraph (2), paragraph (3), Article 50 paragraph (1), paragraph (3), and/or Article 51 letter c shall be subject to administrative sanctions in the form of a written warning.

(2) Banks that are late in fulfilling the obligation to submit the Recovery Action Plan for the first time, update the Recovery Action Plan, and/or improve the Recovery Action Plan as referred to in Article 43, Article 46, Article 47 paragraph (1), and/or Article 48 paragraph (2) shall be subject to administrative sanctions in the form of a fine of IDR 2,000,000.00 (two million rupiah) per day of delay or at most IDR 200,000,000.00 (two hundred million rupiah).

(3) Banks that have been subject to administrative sanctions in the form of a fine as referred to in paragraph (2) remain obligated to submit the Recovery Action Plan for the first time, update the Recovery Action Plan, and/or improve the Recovery Action Plan to the Financial Services Authority.

(4) In the event that a Bank has been subject to administrative sanctions as referred to in paragraph (1) and/or paragraph (2), and continues to violate the provisions as referred to in Article 14 paragraph (1), Article 15, Article 16 paragraph (1), paragraph (2), Article 18 paragraph (1), Article 21, Article 30 paragraph (1), Article 31 paragraph (1), Article 33 paragraph (2), paragraph (3), Article 34 paragraph (1), Article 35 paragraph (1), paragraph (5), Article 36 paragraph (1), paragraph (2), paragraph (3), Article 43, Article 44, Article 46, Article 47 paragraph (1), paragraph (3), paragraph (4), Article 48 paragraph (2), paragraph (3), Article 50 paragraph (1), paragraph (3), Article 51 letter c, and/or paragraph (3), the Bank shall be subject to administrative sanctions in the form of:
a. prohibition on issuing new products; b. suspension of certain business activities;
c. prohibition on expanding business activities;
d. prohibition on conducting new business activities; and/or e. downgrade of the Bank's health rating.

(5) In the event that a Bank has been subject to administrative sanctions as referred to in paragraph (1), paragraph (2), and/or paragraph (4), the principal parties of the Bank may be subject to administrative sanctions in the form of prohibition from acting as principal parties in accordance with the Financial Services Authority Regulation regarding the re-evaluation of principal parties of financial service institutions.

Article 54
Banks that are late in fulfilling the obligation to hold deposits and/or debt instruments or investments with capital characteristics as referred to in Article 50 paragraph (1), paragraph (3), and Article 51 letter c may be subject to administrative sanctions in the form of an announcement regarding the Bank's non-compliance in fulfilling the obligation to hold deposits and/or debt instruments or investments with capital characteristics, on the website of the Financial Services Authority.

Article 55
Directors who violate the provisions as referred to in Article 17 and/or Article 42 paragraph (1) shall be subject to administrative sanctions in the form of:
a. written warnings; and/or b. prohibition from acting as principal parties in accordance with the Financial Services Authority Regulation regarding the re-evaluation of principal parties of financial service institutions.

Article 56
The Board of Commissioners who violate the provisions as referred to in Article 18 paragraph (2) shall be subject to administrative sanctions in the form of:
a. written warnings; and/or b. prohibition from acting as principal parties in accordance with the Financial Services Authority Regulation regarding the re-evaluation of principal parties of financial service institutions.

Article 57
The imposition of administrative sanctions as referred to in Article 53 through Article 56 does not eliminate the imposition of other sanctions in accordance with applicable legislation.

CHAPTER IV
DETERMINATION OF STATUS AND SUPERVISORY FOLLOW-UP OF BANKS

Part One
General Provisions
Article 58
The Financial Services Authority determines the supervisory status of Banks and conducts supervisory actions on Banks.

Part Two
Determination of Bank Supervisory Status

Paragraph 1
General Provisions
Article 59
The supervisory status of Banks as referred to in Article 58 consists of:
a. Banks under normal supervision; b. Banks in rehabilitation; and
c. Banks in resolution.

Paragraph 2
Banks in Rehabilitation
Article 60
(1) The Financial Services Authority determines a Bank as a Bank in rehabilitation as referred to in Article 59 letter b when the Bank is assessed to have potential difficulties that endanger its business continuity.

(2) A Bank is assessed to have potential difficulties that endanger its business continuity as referred to in paragraph (1) when the Bank does not meet the provisions established by the Financial Services Authority regarding health level, liquidity level, and/or capital level, taking into account risks, if it meets the criteria:
a. the Bank's health level with a composite rating of 4 (four) and/or composite rating of 5 (five) in 2 (two) consecutive assessment periods; b. the IDR GWM ratio is less than the ratio established for IDR GWM that must be met by the Bank, and based on the Financial Services Authority's assessment:

the Bank is experiencing fundamental liquidity problems; or
the Bank is experiencing deteriorating liquidity in a short period of time;
and/or
c. the Bank's minimum capital provision obligation ratio is equal to or greater than 8% (eight percent) but less than the minimum capital provision obligation ratio according to the Bank's risk profile that must be met by the Bank.

Article 61
Banks are determined by the Financial Services Authority as Banks in rehabilitation for a period of:
a. at most 1 (one) year calculated from the date of the written notice letter from the Financial Services Authority to the Bank; or b. in accordance with the expiration of the placement of funds by the Deposit Insurance Corporation, in the event the Bank receives the placement of funds from the Deposit Insurance Corporation.

Article 62
(1) Banks that meet the criteria as referred to in Article 60 paragraph (2) may not be determined as Banks in rehabilitation by the Financial Services Authority if:
a. the Bank is in the process of merger, consolidation, takeover, or integration; b. the Bank is in the process of increasing capital contributions that have at least been recorded in the criteria for paid-up capital, with fulfillment of at least up to the minimum capital provision obligation ratio meeting additional capital as a buffer; and/or
c. the Bank is implementing a rehabilitation action plan.

(2) In the event that a Bank meets the criteria as referred to in paragraph (1), the Bank remains in the supervisory status that has not yet met the criteria for a Bank in rehabilitation.

Paragraph 3
Banks in Resolution
Article 63
The Financial Services Authority determines a Bank as a Bank in resolution as referred to in Article 59 letter c when the Bank experiences financial difficulties and endangers its business continuity and cannot be rehabilitated, if it meets the criteria:
a. the time period as referred to in Article 61 has not yet expired, but the Bank's condition has deteriorated and:

the Bank's minimum capital provision obligation ratio is less than 8% (eight percent) and the Financial Services Authority assesses that the Bank can no longer be rehabilitated; and/or
the IDR GWM ratio is equal to 0% (zero percent) and is assessed as unable to be resolved in accordance with applicable legislation;
b. the time period as referred to in Article 61 has expired and:
the Bank's minimum capital provision obligation ratio is less than the minimum capital provision obligation ratio according to the Bank's risk profile; and/or
the IDR GWM ratio is less than the ratio established for IDR GWM that must be met by the Bank and/or has not yet been able to resolve fundamental liquidity problems;
or
c. the Bank is unable to return the placement of funds by the Deposit Insurance Corporation.

Part Three
Supervisory Actions on Banks

Paragraph 1
General Provisions
Article 64
In carrying out supervisory actions as referred to in Article 58 on each supervisory status of Banks as referred to in Article 59, the Financial Services Authority is authorized to:
a. request the Bank to collect and submit data/documents from every location related to the Bank; b. request the Bank to collect and submit data/documents and information from every party that, in the Financial Services Authority's assessment, has influence over the Bank;
c. order the Bank to block certain accounts; and/or
d. order the Bank to take certain actions.

Article 65
(1) The implementation of authority as referred to in Article 64 letter a and letter b is carried out in direct supervision and/or indirect supervision.

(2) Direct supervision as referred to in paragraph (1) is carried out in accordance with the Financial Services Authority Regulation regarding requirements and procedures for bank examinations.

(3) Indirect supervision as referred to in paragraph (1) is carried out in accordance with requests from the Financial Services Authority.

Article 66
(1) Orders to block certain accounts as referred to in Article 64 letter c are carried out based on:
a. the implementation of the Financial Services Authority's supervisory duties; or b. requests from other parties to the Financial Services Authority.

(2) Blocking orders as referred to in paragraph (1) are carried out for accounts suspected of being used to receive or hold funds resulting from violations of applicable legislation.

(3) Blocking as referred to in paragraph (1) is carried out for a specific period or until there is an order from the Financial Services Authority to lift the blocking.

(4) Further provisions regarding the blocking of certain accounts are regulated by the Financial Services Authority.

Article 67
Blocking of certain accounts for accounts under the name of an individual or other party who has been declared a suspect or defendant by the police, prosecutor, judge, or other law enforcement officials based on authority granted by law, is carried out in accordance with applicable legislation without requiring permission from the Financial Services Authority.

Paragraph 2
Banks Under Normal Supervision Experiencing Difficulties Endangering Business Continuity
Article 68
(1) Banks under normal supervision experience difficulties endangering their business continuity if the Bank does not meet normal supervisory conditions and shows deteriorating business conditions but does not yet meet the criteria for a Bank in rehabilitation.

(2) Banks under normal supervision experiencing difficulties endangering their business continuity as referred to in paragraph (1) must:
a. implement the Recovery Action Plan that has been approved by the Financial Services Authority as referred to in Article 48; and b. submit and implement an action plan to the Financial Services Authority if there are other actions to be taken besides those contained in the Recovery Action Plan.

(3) For Banks conducting business based on Sharia principles and Banks conducting conventional business that have Sharia business units, the action plan as referred to in paragraph (2) letter b must first obtain an opinion from the Sharia supervisory board.

(4) The opinion of the Sharia supervisory board as referred to in paragraph (3) is included in the action plan submitted by the Bank.

(5) In the event that the Recovery Action Plan as referred to in paragraph (2) letter a has not been approved by the Financial Services Authority, the Bank implements rehabilitation steps established by the Financial Services Authority.

(6) The Financial Services Authority conducts supervision over the implementation of the Recovery Action Plan, action plan, and/or rehabilitation steps carried out by the Bank as referred to in paragraph (2), paragraph (3), and paragraph (5).

(7) Banks as referred to in paragraph (1) must submit the realization of the implementation of the Recovery Action Plan, action plan, and/or rehabilitation steps as referred to in paragraph (2), paragraph (3), and paragraph (5) to the Financial Services Authority at the end of each month at the latest on the seventh working day of the following month.

(8) The realization of the Recovery Action Plan, action plan, and/or rehabilitation steps as referred to in paragraph (7) must at least contain:
a. the Bank's problems; b. corrective actions taken by the Bank including obstacles faced, if any; and
c. the schedule for corrective actions.

Article 69
(1) The Financial Services Authority evaluates the action plan as referred to in Article 68 paragraph (2) letter b at the latest 5 (five) working days since the action plan is received in complete form.

(2) In the event that the submitted action plan is rejected by the Financial Services Authority, the Bank must submit a revised action plan at the latest 5 (five) working days from the date of the rejection notification.

Article 70
In carrying out supervisory duties towards Banks under normal supervision experiencing difficulties endangering their business continuity, the Financial Services Authority is authorized to:
a. restrict the authority of the General Meeting of Shareholders or equivalent, Board of Commissioners or equivalent, Directors or equivalent, and shareholders or equivalent; b. request and/or order shareholders or equivalent to increase capital;
c. request shareholders or equivalent to replace members of the Board of Commissioners or equivalent, and/or Directors or equivalent;
d. request and/or order the Bank to write off credits or disbursements of non-performing loans and calculate the Bank's losses with its capital; e. request the Bank to merge or consolidate with another Bank; f. request shareholders or equivalent to sell their ownership of the Bank to buyers; g. request and/or order the Bank to hand over the management of all or part of the Bank's activities to other parties; h. request and/or order the Bank to sell part or all of the Bank's assets and/or liabilities to other parties and/or transfer the Bank's liabilities to other parties;
i. order shareholders or equivalent to provide loans to the Bank;
j. order shareholders or equivalent to support the implementation of the duties of the Financial Services Authority and the Deposit Insurance Corporation when addressing Bank problems; k. appoint statutory managers and order the Bank to support the implementation of the duties of statutory managers placed in the Bank;
l. order the Bank not to conduct certain transactions with related parties and/or other parties established by the Financial Services Authority;
m. restrict certain business activities of the Bank; and/or n. order the Bank to take other steps deemed necessary by the Financial Services Authority.

Paragraph 3
Banks in Rehabilitation
Article 71
In carrying out supervisory duties towards Banks determined as Banks in rehabilitation, the Financial Services Authority is authorized to:
a. carry out supervisory actions as referred to in Article 70; b. carry out supervisory actions as referred to in Article 70 letter g, h, k, and/or m in coordination with the Deposit Insurance Corporation; and
c. provide written instructions and/or written orders to Banks in rehabilitation to:

maintain the Bank's financial condition so that there is no material decrease in assets and/or increase in liabilities, including:
a) prohibiting the Bank from selling or reducing the number of assets without the approval of the Financial Services Authority except for Bank Indonesia certificates, Sharia Bank Indonesia certificates, Bank Indonesia deposit certificates, Bank Indonesia foreign currency securities, current accounts at Bank Indonesia, interbank receivables, and/or government securities; and/or b) prohibiting the Bank from changing ownership for:

shareholders who own 10% (ten percent) or more of the Bank's shares; and/or
PSPs including parties that exercise control over the Bank in the Bank's business group structure, unless approval from the Financial Services Authority has been obtained;

report every change in the Bank's share ownership of less than 10% (ten percent) to the Financial Services Authority; and
support the implementation of actions by the Deposit Insurance Corporation towards Banks in rehabilitation in accordance with applicable legislation in the form of:
a) due diligence to determine the overall condition of the Bank; b) exploration with other Banks willing to accept the transfer of part or all of the Bank's assets and/or liabilities; and/or c) exploration with investors willing to take over the Bank.

Article 72
(1) Banks determined as Banks in rehabilitation must take actions to improve the Bank's status.

(2) Actions taken by the Bank as referred to in paragraph (1) must at least:
a. implement actions as referred to in Article 64, Article 68, Article 69, Article 70, and Article 71; b. increase capital by at least the amount required to meet the minimum capital provision obligation ratio according to the risk profile, in accordance with applicable legislation regarding minimum capital provision obligations for general banks and applicable legislation regarding minimum capital provision obligations for Sharia general banks;
c. fulfill GWM obligations in accordance with applicable legislation regarding mandatory reserve requirements; and
d. improve factors that are part of the Bank's health rating assessment in accordance with the Financial Services Authority Regulation regarding the assessment of general banks' health levels.

(3) Capital increases as referred to in paragraph (2) letter b must be fulfilled by the Bank within the time period as referred to in Article 61.

Article 73
(1) Banks determined as Banks in rehabilitation must notify all office networks they own regarding certain business activities that are subject to restrictions and/or supervisory actions established by the Financial Services Authority.

(2) Notifications to all office networks as referred to in paragraph (1) must be carried out on the date of receipt of the notification of restrictions on certain business activities and/or determination of supervisory actions from the Financial Services Authority.

Article 74
Supervisory actions that have been established previously when the Bank was determined as:
a. a Bank under normal supervision; or b. a Bank under normal supervision experiencing difficulties endangering its business continuity, are declared to remain in effect for Banks in rehabilitation.

Article 75
(1) Banks determined as Banks in rehabilitation must submit to the Financial Services Authority:
a. the latest financial reports in the form of balance sheets and profit and loss statements as well as administrative accounts; b. the latest details of productive assets grouped by quality;
c. the latest composite rating of the Bank's health level;
d. information and documents regarding:

the latest list of aggregated customer deposits grouped by nominal value; and
the latest list of details of the Bank's receivables and liabilities to related parties;
e. the latest financial reports of companies receiving capital participation from the Bank other than temporary capital participation in the context of credit or financing restructuring; f. the latest business group structure reports related to the Bank; g. cash flow projection reports for a period of 1 (one) month ahead or based on other reporting periods, detailed daily and with frequency as established by the Financial Services Authority; and h. other information and/or reports required by the Financial Services Authority.

(2) Reports as referred to in paragraph (1) must be submitted to the Financial Services Authority at the latest 3 (three) working days since the Bank is determined as a Bank in rehabilitation.

Article 76
Banks in rehabilitation that are issuers or public companies ordered by the Financial Services Authority to take certain actions are exempt from Financial Services Authority Regulations in the capital market sector.

Article 77
(1) In the event that a Bank determined as a Bank in rehabilitation:
a. experiences liquidity difficulties; and b. does not meet the requirements as a recipient of short-term liquidity loans or Sharia-based short-term liquidity financing from Bank Indonesia, the Bank may submit a request to obtain the placement of funds by the Deposit Insurance Corporation to the Financial Services Authority in accordance with applicable legislation.

(2) The mechanism to obtain the placement of funds by the Deposit Insurance Corporation as referred to in paragraph (1) is carried out in accordance with applicable legislation regarding the placement of funds by the Deposit Insurance Corporation.

Article 78
Banks are determined to exit the status of Bank in rehabilitation to become Banks under normal supervisory status when the Bank has met the criteria for normal supervisory status.

Paragraph 4
Implementation of Financial Services Authority Authority
Article 79
(1) The implementation of the Financial Services Authority's authority in carrying out supervisory actions as referred to in Article 58 on each supervisory status of Banks as referred to in Article 59 is carried out through:
a. written instructions; and/or b. written orders.

(2) Banks must fulfill written instructions and/or written orders as referred to in paragraph (1).

(3) In fulfilling written instructions from the Financial Services Authority as referred to in paragraph (1) letter a, the Bank submits binding commitments that must be implemented from:
a. the Directors and/or Board of Commissioners of the Bank, to carry out or not carry out certain actions; and/or b. PSPs, to address problems that are PSP obligations.

(4) In fulfilling written orders from the Financial Services Authority as referred to in paragraph (1) letter b, it is carried out in accordance with the Financial Services Authority Regulation regarding written orders.

Paragraph 5
Banks in Resolution
Article 80
(1) The determination of the supervisory status of Banks in resolution is declared to end when the Deposit Insurance Corporation has released all its ownership in:
a. Intermediary Banks; or b. Banks that receive temporary capital placement by the Deposit Insurance Corporation, to investors and/or other parties as new owners of the Bank.

(2) Banks as referred to in paragraph (1) must meet the criteria for the status of Banks under normal supervision.

Part Four
Inter-Agency Coordination
Article 81
The Financial Services Authority notifies changes in the supervisory status of Banks as referred to in Article 59 in writing to the Bank, the Deposit Insurance Corporation, and Bank Indonesia.

Article 82
With the determination of the supervisory status of Banks as Banks in resolution, all rights and authorities of the General Meeting of Shareholders, ownership, management, and other interests in the Bank are transferred to the Deposit Insurance Corporation in accordance with applicable legislation.

Article 83
In the event that a Bank determined to be a Bank in resolution is a Systemic Bank, the Financial Services Authority requests the convening of a meeting of the Financial Stability Committee to report the determination of the Systemic Bank as a Bank in resolution.

Article 84
In the event that a Bank determined to be a Bank in resolution is a Systemic Bank as referred to in Article 83, the Financial Services Authority notifies the Systemic Bank of the determination of the Systemic Bank as a Bank in resolution after submission to the Deposit Insurance Corporation in the meeting of the Financial Stability Committee.

Article 85
(1) In the event that a Bank determined to be a Bank in resolution is a Bank other than a Systemic Bank and the Deposit Insurance Corporation decides not to conduct a rescue or not to continue the rescue process for the said Bank, the Financial Services Authority revokes the business license of the Bank other than a Systemic Bank after obtaining:
a. notification of the decision not to conduct a rescue or not to continue the rescue process for the Bank other than a Systemic Bank determined to be a Bank in resolution from the Deposit Insurance Corporation; and b. a request for the revocation of the business license of the Bank from the Deposit Insurance Corporation. (2) After the Financial Services Authority issues the decision to revoke the business license of the Bank other than a Systemic Bank as referred to in paragraph (1), the Deposit Insurance Corporation carries out the liquidation process and the dissolution of the legal entity of the said Bank.

Article 86
(1) In the event that the decision to handle the problems of a Bank determined to be a Bank in resolution is carried out by:
a. transferring part or all of the assets and/or liabilities of the Bank to a receiving bank; or b. transferring part or all of the assets and/or liabilities of the Bank to a Bridge Bank, the Deposit Insurance Corporation submits a request for the revocation of the business license of the Bank to the Financial Services Authority within a maximum of 5 (five) working days from the completion of the transfer of part or all of the assets and/or liabilities of the Bank. (2) After the Financial Services Authority issues the decision to revoke the business license of the Bank as referred to in paragraph (1), the Deposit Insurance Corporation carries out the liquidation process and the dissolution of the legal entity of the said Bank. (3) Based on the request of the Deposit Insurance Corporation, the Financial Services Authority may grant approval to extend the time limit for the request for revocation of the business license of the Bank as referred to in paragraph (1).

Article 87
In the event that there is a decision to conduct a rescue for a Bank determined to be a Bank in resolution, the said Bank remains under supervisory status as a Bank in resolution until the rescue process is completed by the Deposit Insurance Corporation.

Article 88
The implementation of the authority of the Financial Services Authority over Banks in resolution is carried out in coordination with the Deposit Insurance Corporation.

Fifth Section
Submission of Reports, Information, and Other Documents

Article 89
(1) The submission of reports, information, and/or other documents as referred to in Article 68 paragraph (2) letter b, paragraph (7), Article 69 paragraph (2), Article 71 letter c number 2, Article 75, Article 77 paragraph (1), and/or Article 79 paragraph (3) is submitted to the Financial Services Authority online through the Financial Services Authority's reporting system in accordance with the procedures as specified in the Financial Services Authority Regulation regarding the reporting of general banks through the Financial Services Authority's reporting system. (2) In the event that the Financial Services Authority's reporting system as referred to in paragraph (1) is not yet available or in the event of force majeure, submission is carried out through the Financial Services Authority's correspondence system. (3) In the event that the Financial Services Authority's correspondence system as referred to in paragraph (2) is not yet available or in the event of force majeure, submission is carried out offline to the Financial Services Authority. (4) Submission through the Financial Services Authority's correspondence system or offline as referred to in paragraph (2) and paragraph (3) is addressed to:
a. the Relevant Bank Supervision Department or the Financial Services Authority Office in Jakarta, for Banks whose headquarters or domicile are in the Special Capital Region of Jakarta Province and Banten Province; or b. the local Financial Services Authority Office, for Banks whose headquarters or domicile are outside the Special Capital Region of Jakarta Province and Banten Province.

Sixth Section
Sanctions

Article 90
(1) Banks that violate the provisions as referred to in Article 68 paragraph (2), paragraph (3), paragraph (7), Article 69 paragraph (2), Article 72 paragraph (1), paragraph (3), Article 73, Article 75, Article 79 paragraph (2), and/or Article 80 paragraph (2), are subject to administrative sanctions in the form of a written reprimand. (2) In the event that a Bank has been subject to administrative sanctions as referred to in paragraph (1), and continues to violate the provisions as referred to in Article 68 paragraph (2), paragraph (3), paragraph (7), Article 69 paragraph (2), Article 72 paragraph (1), paragraph (3), Article 73, Article 75, Article 79 paragraph (2), and/or Article 80 paragraph (2), the Bank is subject to administrative sanctions in the form of:
a. prohibition on issuing new Bank products; b. suspension of certain business activities of the Bank;
c. prohibition on expanding business activities;
d. prohibition on conducting new business activities; and/or e. reduction of the Bank's health level assessment.
(3) In the event that a Bank has been subject to administrative sanctions as referred to in paragraph (1) and/or paragraph (2), the principal parties of the Bank may be subject to administrative sanctions in the form of prohibition as a principal party in accordance with the Financial Services Authority Regulation regarding the re-evaluation of principal parties of financial service institutions. (4) The imposition of administrative sanctions as referred to in paragraph (1), paragraph (2), and/or paragraph (3) does not eliminate the Bank's obligation to implement written instructions and/or written orders.

Article 91
The Board of Directors, Board of Commissioners, and/or PSPs that violate the provisions as referred to in Article 79 paragraph (3) are subject to administrative sanctions in the form of:
a. written reprimand; and/or b. prohibition as a principal party in accordance with the Financial Services Authority Regulation regarding the re-evaluation of principal parties of financial service institutions.

Article 92
The imposition of administrative sanctions as referred to in Article 90 and Article 91 does not eliminate the imposition of other sanctions in accordance with applicable legislation.

CHAPTER V
BRIDGE BANKS

First Section
General

Article 93
Bridge Banks are established and conduct business activities after obtaining a license from the Financial Services Authority.

Article 94
Bridge Banks are in the form of a limited liability company.

Article 95
Bridge Banks consist of:
a. Bridge Banks that conduct business activities on a conventional basis; or b. Bridge Banks that conduct business activities based on Sharia principles.

Second Section
Establishment of Bridge Banks

Article 96
(1) Bridge Banks may only be established and owned by the Deposit Insurance Corporation.
(2) In the establishment of Bridge Banks by the Deposit Insurance Corporation as referred to in paragraph (1), the following do not apply:
a. provisions requiring a limited liability company to be established by 2 (two) or more persons as referred to in the law on limited liability companies; and b. the maximum limit on share ownership as regulated in the Financial Services Authority provisions on share ownership of general banks.

Article 97
The issuance of Bridge Bank licenses as referred to in Article 93 is carried out in 2 (two) stages:
a. principle approval to conduct preparations for the establishment of a Bridge Bank; and b. business license to conduct Bridge Bank business activities after the preparations for the establishment of the Bridge Bank as referred to in letter a are completed.

Paragraph 1
Principle Approval

Article 98
The request for principle approval to conduct preparations for the establishment of a Bridge Bank as referred to in Article 97 letter a is submitted by the Deposit Insurance Corporation.

Article 99
(1) The basic capital to obtain principle approval is at least equal to the basic capital for the establishment of a limited liability company.
(2) The basic capital as referred to in paragraph (1) must be fully placed and paid up.

Article 100
The request to obtain principle approval is submitted by the Deposit Insurance Corporation to the Financial Services Authority, accompanied by documents:
a. articles of association which at least contain:

name and domicile;
business activities as a Bank;
capital;
ownership;
authority, responsibility, and term of office of Board of Directors members, Board of Commissioners members, and Sharia Supervisory Board members for Bridge Banks that conduct business activities based on Sharia principles; and
a clause that Board of Directors members, Board of Commissioners members, and Sharia Supervisory Board members for Bridge Banks that conduct business activities based on Sharia principles must obtain approval from the Financial Services Authority before carrying out actions, duties, and functions;
b. proof of capital deposit as referred to in Article 99; and
c. organizational structure and human resources for the establishment of the Bridge Bank.

Article 101
(1) In granting principle approval, the Financial Services Authority assesses the completeness of documents.
(2) Based on the results of the assessment of document completeness as referred to in paragraph (1), the Financial Services Authority may request completeness and/or corrections to the fulfillment of documents from the Deposit Insurance Corporation.

Article 102
Principle approval is granted by the Financial Services Authority within a maximum of 30 (thirty) working days after the request documents to obtain principle approval are received completely as referred to in Article 101.

Article 103
Principle approval as referred to in Article 102 remains valid until the business license approval is granted by the Financial Services Authority.

Paragraph 2
Business License

Article 104
Bridge Banks may only conduct business activities after obtaining a business license from the Financial Services Authority.

Article 105
The submission of the request for the business license for the establishment of a Bridge Bank as referred to in Article 97 letter b is carried out in the event that:
a. principle approval to conduct preparations for the establishment of a Bridge Bank as referred to in Article 102 has been granted by the Financial Services Authority; and b. the supervisory status of the prospective Parent Bank has been determined as a Bank in rehabilitation or a Bank in resolution.

Article 106
(1) The request to obtain a business license for a Bridge Bank is submitted by the Deposit Insurance Corporation to the Financial Services Authority, accompanied by documents:
a. the organizational structure of the Bridge Bank; and b. an action plan including methods and schedules for the transfer, fulfillment, and management of human resources, as well as the migration of Bridge Bank infrastructure. (2) In order to fulfill the provisions as referred to in paragraph (1), accompanied by:
a. administrative documents required for the assessment of competence and propriety of prospective Board of Directors members, prospective Board of Commissioners members, and prospective Sharia Supervisory Board members for Bridge Banks that conduct business activities based on Sharia principles, in accordance with Financial Services Authority provisions on the assessment of competence and propriety for principal parties of financial service institutions; and b. documents as referred to in Article 100 in the event of changes. (3) The Deposit Insurance Corporation may fulfill the documents as referred to in paragraph (1) letter a and/or letter b derived from relevant documents of the Parent Bank. (4) In the event that the documents as referred to in paragraph (1) letter a and/or letter b cannot be fulfilled at the time of the request for the business license for the Bridge Bank, the Deposit Insurance Corporation submits a statement letter that the documents will be submitted once available.

Article 107
In granting approval for the business license request, the Financial Services Authority assesses the completeness of documents as referred to in Article 106.

Article 108
The Financial Services Authority grants approval for the business license request for the Bridge Bank as referred to in Article 107 after there is a decision determining that the bank rescue is conducted through the establishment of a Bridge Bank.

Article 109
(1) Bridge Banks that have obtained a business license from the Financial Services Authority must conduct banking business activities within a maximum of 30 (thirty) working days calculated from the date the business license is granted by the Financial Services Authority. (2) The implementation of business activities as referred to in paragraph (1) must be reported by the Board of Directors of the Bridge Bank to the Financial Services Authority within a maximum of 10 (ten) working days after the date of implementation of the business activities. (3) Based on the request of the Deposit Insurance Corporation or in the event of force majeure, the Financial Services Authority may grant approval to extend the time limit for the implementation of business activities as referred to in paragraph (1).

Article 110
(1) Under certain conditions, the Deposit Insurance Corporation may submit requests for principle approval and business license for the establishment of a Bridge Bank at the same time. (2) Requests for principle approval and business license for the Bridge Bank at the same time as referred to in paragraph (1) are accompanied by complete documents as referred to in Article 100 and Article 106.

Article 111
(1) The granting of approval for the request for the establishment of a Bridge Bank as referred to in Article 110 is granted by the Financial Services Authority in the form of:
a. principle approval; and b. business license, which are issued simultaneously.
(2) In granting approval as referred to in paragraph (1), the Financial Services Authority carries out the steps as referred to in Article 101, Article 107, and Article 108.

Article 112
(1) Prospective Board of Directors members, prospective Board of Commissioners members, and prospective Sharia Supervisory Board members of the Bridge Bank must obtain approval from the Financial Services Authority before carrying out actions, duties, and functions as Board of Directors members, Board of Commissioners members, and Sharia Supervisory Board members of the Bridge Bank. (2) To obtain approval from the Financial Services Authority as referred to in paragraph (1), prospective Sharia Supervisory Board members of the Bridge Bank must obtain a recommendation from the National Sharia Board of the Indonesian Ulama Council. (3) To grant approval as referred to in paragraph (1), the Financial Services Authority assesses the competence and propriety of prospective Board of Directors members, prospective Board of Commissioners members, and prospective Sharia Supervisory Board members of the Bridge Bank. (4) The assessment of competence and propriety carried out by the Financial Services Authority as referred to in paragraph (3) is carried out:
a. after the Bridge Bank conducts business activities; and b. before the Bridge Bank's health level is assessed by the Financial Services Authority.

Article 113
(1) In the event that the Financial Services Authority has not yet granted approval for the assessment of competence and propriety, the Financial Services Authority grants temporary approval for prospective Board of Directors members, prospective Board of Commissioners members, and/or prospective Sharia Supervisory Board members of the Bridge Bank, who are given full authority to carry out functions, duties, and actions as Board of Directors members, Board of Commissioners members, and Sharia Supervisory Board members of the Bridge Bank. (2) Temporary approval for Board of Directors members, Board of Commissioners members, and Sharia Supervisory Board members of the Bridge Bank as referred to in paragraph (1) remains valid until the prospective Board of Directors members, prospective Board of Commissioners members, and/or prospective Sharia Supervisory Board members of the Bridge Bank are approved by the Financial Services Authority in the assessment of competence and propriety. (3) In the event that Board of Directors members, Board of Commissioners members, and/or Sharia Supervisory Board members of the Bridge Bank who have taken office based on temporary approval as referred to in paragraph (2) are not approved in the assessment of competence and propriety, the Board of Directors members, Board of Commissioners members, and/or Sharia Supervisory Board members are prohibited from carrying out actions as Board of Directors members, Board of Commissioners members, and/or Sharia Supervisory Board members of the Bridge Bank. (4) Legal acts carried out for and on behalf of the Bridge Bank by Board of Directors members, Board of Commissioners members, and/or Sharia Supervisory Board members of the Bridge Bank who have obtained temporary approval but are not approved in the assessment of competence and propriety as referred to in paragraph (3) remain binding and become the responsibility of the Bridge Bank. (5) Legal acts carried out for and on behalf of the Bridge Bank by Board of Directors members, Board of Commissioners members, and/or Sharia Supervisory Board members of the Bridge Bank as referred to in paragraph (3) after the relevant parties are not approved in the assessment of competence and propriety are invalid and become the personal responsibility of the relevant parties.

Third Section
Business Activities and Office Network

Article 114
During the business activities of the Bridge Bank, the Bridge Bank may use part or all of the facilities and infrastructure of the Parent Bank.

Paragraph 1
Transfer of Assets and Liabilities

Article 115
(1) The Bridge Bank receives the transfer of part or all of the assets and/or liabilities from 1 (one) Parent Bank.
(2) Under certain conditions, 1 (one) Bridge Bank may be used to receive the transfer of part or all of the assets and/or liabilities from more than 1 (one) Parent Bank.

Article 116
(1) Bridge Banks as referred to in Article 95 letter a:
a. receive the transfer of part or all of the assets and/or liabilities from 1 (one) or more Parent Banks that conduct business activities on a conventional basis; and/or b. receive the transfer of part or all of the assets and/or liabilities other than assets and/or liabilities of Sharia business units from 1 (one) or more Parent Banks that conduct business activities on a conventional basis and have Sharia business units. (2) Bridge Banks as referred to in Article 95 letter b:
a. receive the transfer of part or all of the assets and/or liabilities from 1 (one) or more Parent Banks that conduct business activities based on Sharia principles; and/or b. receive the transfer of part or all of the assets and/or liabilities of Sharia business units from 1 (one) or more Parent Banks that conduct business activities on a conventional basis and have Sharia business units.

Article 117
The types and criteria of assets and liabilities of the Parent Bank that can be transferred to the Bridge Bank are carried out in accordance with applicable legislation.

Article 118
(1) In the event that there are other part or all of the assets and/or liabilities of the Parent Bank to be transferred to the Bridge Bank that has conducted business activities, the Deposit Insurance Corporation submits the transfer plan to the Financial Services Authority within a maximum of 5 (five) days before the transfer is carried out. (2) The submission of the transfer plan as referred to in paragraph (1) is accompanied by an action plan including:
a. transfer schedule; and b. transfer procedures and mechanisms.

Article 119
(1) In the event that based on the evaluation of the Deposit Insurance Corporation, Board of Directors members, Board of Commissioners members, and/or Sharia Supervisory Board members of the Bridge Bank are assessed as no longer meeting competency requirements in connection with the addition of the transfer of part or all of the assets and/or liabilities as referred to in Article 118, the Deposit Insurance Corporation submits prospective Board of Directors members, prospective Board of Commissioners members, and/or prospective Sharia Supervisory Board members for the assessment of competence and propriety. (2) The submission of prospective Board of Directors members, prospective Board of Commissioners members, and/or prospective Sharia Supervisory Board members as referred to in paragraph (1) is carried out within a maximum of 2 (two) months after the Bridge Bank completes the process of receiving part or all of the assets and/or liabilities of other Parent Banks transferred. (3) The assessment of competence and propriety as referred to in paragraph (1) is carried out in accordance with the provisions as referred to in Article 112 paragraph (1), paragraph (2), and paragraph (3). (4) Board of Directors members, Board of Commissioners members, and/or Sharia Supervisory Board members of the Bridge Bank as referred to in paragraph (1) take office until the prospective Board of Directors members, prospective Board of Commissioners members, and/or prospective Sharia Supervisory Board members are approved in the assessment of competence and propriety as referred to in paragraph (3).

Paragraph 2
Bridge Bank Operations

Article 120
(1) Applicable legislation provisions for Banks remain applicable to Bridge Banks unless otherwise specifically regulated.
(2) Bridge Banks may use part or all of the products and activities of the Parent Bank.
(3) Bridge Banks that use part or all of the products and activities of the Parent Bank as referred to in paragraph (2) must still meet the applicable criteria and requirements.

Article 121
The fulfillment of minimum capital and minimum core capital obligations for Banks does not apply to Bridge Banks for a maximum of 2 (two) years calculated from the date the Bridge Bank conducts business activities.

Article 122
The Financial Services Authority may establish other policies in the assessment of the health level of Bridge Banks.

Fourth Section
Termination of Bridge Banks

Article 123
Bridge Banks end in the event that the Deposit Insurance Corporation has:
a. sold all shares of the Bridge Bank; or b. transferred all assets and liabilities of the Bridge Bank, in accordance with applicable legislation.

Article 124
(1) In the event that the Deposit Insurance Corporation sells all shares of the Bridge Bank as referred to in Article 123 letter a then:
a. the sale of shares must meet the requirements for the number of shareholders and ownership of the Bank by foreign citizens and/or foreign legal entities, as regulated in applicable legislation; b. in the event that the sale of shares does not meet the requirements for the number of shareholders and/or the provisions on ownership of the Bank by foreign citizens and/or foreign legal entities as referred to in letter a, the fulfillment of the provisions is set within a maximum of 1 (one) year from the purchase of all shares of the Bridge Bank;
c. parties that purchase shares of the Bridge Bank are exempt from provisions in accordance with the Financial Services Authority Regulation on share ownership of general banks; and
d. in the event that there are still financial obligations of the Bridge Bank to be fulfilled, the financial obligations must be fulfilled by the party that purchases the shares of the Bridge Bank. (2) Regarding the party that purchases the shares of the Bridge Bank:
a. must fulfill the Bank ownership provisions as referred to in paragraph (1) letter b; and b. in the event that there are supervisory actions ordered by the Financial Services Authority, the exemption as referred to in paragraph (1) letter c does not apply.

Article 125
In the event that the Deposit Insurance Corporation transfers all assets and liabilities of the Intermediary Bank as referred to in Article 123 letter b, the transfer of all assets and/or liabilities may be carried out at once or in stages.

Article 126
(1) The Deposit Insurance Corporation submits a request for the revocation of the business license of the Intermediary Bank to the Financial Services Authority within a maximum of 30 (thirty) working days since the transfer of all assets and liabilities of the Intermediary Bank has been completed. (2) The procedure for the revocation of the business license of the Intermediary Bank as referred to in paragraph (1) is implemented in accordance with applicable legislation. (3) After the Financial Services Authority issues a decision on the revocation of the business license of the Intermediary Bank, the Deposit Insurance Corporation carries out the liquidation process and the dissolution of the legal entity of the said Intermediary Bank.

Fifth Section
Termination of the Parent Bank

Article 127
(1) The Deposit Insurance Corporation submits a request for the revocation of the business license of the Parent Bank to the Financial Services Authority within a maximum of 5 (five) working days since the transfer of part or all of the assets and/or liabilities of the Parent Bank to the Intermediary Bank has been completed. (2) After the Financial Services Authority issues a decision on the revocation of the business license of the Parent Bank as referred to in paragraph (1), the Deposit Insurance Corporation carries out the liquidation process and the dissolution of the legal entity of the said Parent Bank. (3) Based on the request of the Deposit Insurance Corporation, the Financial Services Authority may grant approval to extend the time limit for the request for revocation of the business license of the Parent Bank as referred to in paragraph (1).

Sixth Section
Inter-Agency Coordination

Article 128
The implementation of the authority of the Financial Services Authority over the Intermediary Bank is carried out in coordination with the Deposit Insurance Corporation.

Seventh Section
Submission of Reports, Information, and Other Documents

Article 129
(1) The submission of reports on the implementation of the business activities of the Intermediary Bank as referred to in Article 109 paragraph (2) and/or the submission of the transfer plan as referred to in Article 118 paragraph (1) is submitted to the Financial Services Authority online through the Financial Services Authority reporting system in accordance with the procedure set forth in the Financial Services Authority Regulation regarding the reporting of general banks through the Financial Services Authority reporting system. (2) In the event that the Financial Services Authority reporting system as referred to in paragraph (1) is not yet available or there is a force majeure situation, the submission is carried out through the Financial Services Authority correspondence system. (3) In the event that the Financial Services Authority correspondence system as referred to in paragraph (2) experiences a force majeure situation, the submission is carried out offline to the Financial Services Authority. (4) Submission through the Financial Services Authority correspondence system or offline as referred to in paragraphs (2) and (3) is addressed to:
a. The Relevant Bank Supervision Department or the Financial Services Authority Office in Jakarta, for Banks whose headquarters or domicile are in the Special Capital Region of Jakarta Province and Banten Province; or b. The Local Financial Services Authority Office, for Banks whose headquarters or domicile are outside the Special Capital Region of Jakarta Province and Banten Province.

Eighth Section
Sanctions

Article 130
(1) Parties who violate the provisions as referred to in Article 112 paragraph (1), Article 113 paragraph (3), and/or Article 124 paragraph (2) letter a are subject to administrative sanctions in the form of a written reprimand. (2) In the event that the violating party has been subjected to administrative sanctions as referred to in paragraph (1), they may be subjected to administrative sanctions in the form of a prohibition from acting as a main party in accordance with the Financial Services Authority Regulation regarding the reassessment of main parties of financial service institutions.

Article 131
The imposition of administrative sanctions as referred to in Article 130 does not eliminate the imposition of other sanctions in accordance with applicable legislation.

CHAPTER VI
TRANSITIONAL PROVISIONS

Article 132
The determination of Systemic Banks and the formation of Capital Surcharge before this Financial Services Authority Regulation takes effect are declared to remain in effect until the next written notification of the determination of Systemic Banks and the formation of Capital Surcharge by the Financial Services Authority as referred to in Article 3.

Article 133
Recovery Plans that have been submitted by Systemic Banks and have not been approved by the Financial Services Authority before this Financial Services Authority Regulation takes effect remain processed in accordance with Financial Services Authority Regulation Number 14/POJK.03/2017 concerning Recovery Plans for Systemic Banks.

Article 134
At the time this Financial Services Authority Regulation takes effect, Banks that have debt instruments or investments with characteristics of other parties' equity that do not comply with the provisions as referred to in Article 36 paragraph (3) may continue to hold the said instruments until the instruments mature.

Article 135
Principle approvals for Intermediary Banks that have been granted by the Financial Services Authority before this Financial Services Authority Regulation takes effect are declared to remain in effect.

CHAPTER VII
CLOSING PROVISIONS

Article 136
At the time this Financial Services Authority Regulation takes effect, all existing terms "Recovery Plan" that existed before this Financial Services Authority Regulation takes effect must be interpreted as the term "Recovery Plan" as referred to in this Financial Services Authority Regulation.

Article 137
At the time this Financial Services Authority Regulation takes effect, all Financial Services Authority Regulations and other regulations governing Recovery Plans are declared to remain in effect insofar as they do not conflict with the provisions in this Financial Services Authority Regulation.

Article 138
At the time this Financial Services Authority Regulation takes effect, Financial Services Authority Regulation Number 11/POJK.03/2016 concerning Minimum Capital Requirements for General Banks (State Gazette of the Republic of Indonesia Year 2016 Number 25, Supplement to the State Gazette of the Republic of Indonesia Number 5848) as amended several times, lastly with Financial Services Authority Regulation Number 27 of 2022 concerning the Second Amendment to Financial Services Authority Regulation Number 11/POJK.03/2016 concerning Minimum Capital Requirements for General Banks (State Gazette of the Republic of Indonesia Year 2022 Number 35/OJK, Supplement to the State Gazette of the Republic of Indonesia Number 26/OJK), is declared to remain in effect insofar as it does not conflict with the provisions in this Financial Services Authority Regulation.

Article 139
At the time this Financial Services Authority Regulation takes effect:
a. Financial Services Authority Regulation Number 14/POJK.03/2017 concerning Recovery Plans for Systemic Banks (State Gazette of the Republic of Indonesia Year 2017 Number 64, Supplement to the State Gazette of the Republic of Indonesia Number 6038); b. Financial Services Authority Regulation Number 15/POJK.03/2017 concerning the Determination of Status and Follow-up of Supervision of General Banks (State Gazette of the Republic of Indonesia Year 2017 Number 65, Supplement to the State Gazette of the Republic of Indonesia Number 6039);
c. Financial Services Authority Regulation Number 16/POJK.03/2017 concerning Intermediary Banks (State Gazette of the Republic of Indonesia Year 2017 Number 66, Supplement to the State Gazette of the Republic of Indonesia Number 6040);
d. Financial Services Authority Regulation Number 43/POJK.03/2017 concerning Follow-up on the Implementation of Bank Supervision (State Gazette of the Republic of Indonesia Year 2017 Number 149, Supplement to the State Gazette of the Republic of Indonesia Number 6092); and e. Financial Services Authority Regulation Number 2/POJK.03/2018 concerning the Determination of Systemic Banks and Capital Surcharge (State Gazette of the Republic of Indonesia Year 2018 Number 35, Supplement to the State Gazette of the Republic of Indonesia Number 6190), are repealed and declared invalid.

Article 140
This Financial Services Authority Regulation takes effect on the date of its promulgation.

This copy is in accordance with the original
Director of Legal Development
Legal Department
Aat Windradi

To ensure everyone knows, it is ordered to promulgate this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia.

Determined in Jakarta on 25 March 2024
CHAIRMAN OF THE COMMISSIONERS BOARD
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA,
MAHENDRA SIREGAR

Promulgated in Jakarta on 27 March 2024
MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA,
YASONNA H. LAOLY

STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2024 NUMBER 7/OJK signed

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
OF THE REPUBLIC OF INDONESIA
NUMBER 5 OF 2024
CONCERNING
THE DETERMINATION OF SUPERVISORY STATUS AND
HANDLING OF PROBLEMS OF GENERAL BANKS

I. GENERAL

The development and strengthening of the banking sector aims to ensure that banks can continue to play their role in contributing more optimally to the national economy, having better resilience, high competitiveness, and maintaining financial system stability. Various potential failures in the banking sector, along with the development of the banking industry that is becoming more complex and diverse, including various external challenges such as technological disruption and the emergence of new financial risks that impact the financial system, need to be anticipated with relevant and appropriate policy responses, and in the event of problems in the banking sector, appropriate handling needs to be carried out to maintain financial system stability.

With the enactment of Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector, the handling of Bank problems, strengthening of inter-agency coordination, and strengthening of institutional authority in the financial sector, particularly banking, have become very important aspects in preventing banking failures that can disrupt the financial system and maintaining the stability of the banking industry in supporting the national economy and maintaining public trust.

As a follow-up to the provisions of the aforementioned legislation, including considering the current conditions regarding supervisory aspects and the handling of Bank problems, and as an effort to comprehensively improve and adjust the strengthening of supervision and handling of Bank problems, adjustments to Financial Services Authority regulations related to financial system stability are carried out comprehensively and integrated into 1 (one) Financial Services Authority Regulation to support financial system stability in the banking sector.

This Financial Services Authority Regulation aims to support the implementation of strengthened supervision and handling of Bank problems through relevant, timely, and substantive policy responses to support the competitiveness of the national banking sector and to maintain financial system stability, by aligning and adjusting regulatory aspects related thereto.

In this regard, it is necessary to update regulations related to the Determination of Systemic Banks and Capital Surcharges, Recovery Plans, Determination of Status and Supervisory Follow-up, and Intermediary Banks, in the Financial Services Authority Regulation concerning the Determination of Supervisory Status and Handling of Problems of General Banks.

II. ARTICLE BY ARTICLE

Article 1
It is clear enough.

Article 2
Paragraph (1)
The determination of Banks as Systemic Banks does not include KCBLN.
Paragraph (2)
It is clear enough.
Paragraph (3)
It is clear enough.
Paragraph (4)
It is clear enough.

Article 3
It is clear enough.

Article 4
Paragraph (1)
The methodology for determining Systemic Banks refers to international standards related to the determination of Systemic Banks, including methodologies issued by the Basel Committee on Banking Supervision. Paragraph (2) It is clear enough. Paragraph (3) It is clear enough. Paragraph (4) It is clear enough.

Article 5
Paragraph (1)
It is clear enough.
Paragraph (2)
Letter a
What is meant by "exposure on the balance sheet" is total assets after deducting inter-office positions.
Letter b
What is meant by "exposure on the administrative account" is total liabilities of commitments and contingencies.
Letter c
The calculation of potential future exposure from derivative transactions is in accordance with the Financial Services Authority regulations regarding guidelines for calculating net exposure from derivative transactions in the calculation of risk-weighted assets for credit risk using the standard approach.

Derivative transactions at Banks that carry out business activities based on Sharia principles are Sharia hedging transactions that refer to the Financial Services Authority regulations regarding the calculation of risk-weighted assets for credit risk using the standard approach for Sharia general banks.

Article 6
Letter a
For Banks that carry out business activities based on Sharia principles, what is meant by the notional value of over-the-counter derivatives is the notional value of Sharia hedging over-the-counter transactions that refer to the Financial Services Authority regulations regarding the calculation of risk-weighted assets for credit risk using the standard approach for Sharia general banks. Letter b Number 1 What is meant by "securities with fair value measurement category recognized in profit or loss (fair value through profit or loss)" are securities whose purpose is to be traded or designated for fair value measurement through profit or loss. Number 2 What is meant by "securities with fair value measurement category recognized in other comprehensive income (fair value through other comprehensive income)" are securities whose value changes are not recognized in profit or loss but are recognized in other comprehensive income. Letter c It is clear enough. Letter d It is clear enough.

Article 7
Letter a
It is clear enough.
Letter b
It is clear enough.
Letter c
It is clear enough.
Letter d
Interbank transactions in the money market can involve the number of counterparties involved.

Article 8
What is meant by "systemic importance score of the Bank" is a value that reflects the systemic level of a Bank.
What is meant by "threshold" is the minimum systemic importance score of the Bank that falls into the category of Systemic Banks.

Article 9
It is clear enough.

Article 10
Paragraph (1)
It is clear enough.
Paragraph (2)
Letter a
It is clear enough.
Letter b
Example: A Bank that has a systemic importance score that exceeds the upper limit of the systemic importance score in group (bucket) 4 (four) so that it is classified into group (bucket) 5 (five), then the Financial Services Authority determines the addition of the grouping of Systemic Banks, namely group (bucket) 6 (six). Paragraph (3) It is clear enough. Paragraph (4) Example: the amount of Capital Surcharge for group (bucket) 5 (five) is 3.5% (three point five percent) of risk-weighted assets. Thus, the amount of Capital Surcharge for group (bucket) 6 (six) is determined to be 4.5% (four point five percent) of risk-weighted assets.

Article 11
Paragraph (1)
It is clear enough.
Paragraph (2)
What is meant by "core capital (common equity tier 1)" is core capital (common equity tier 1) as referred to in Financial Services Authority regulations regarding minimum capital requirements for conventional general banks or for Sharia general banks. Paragraph (3) Considerations for reviewing and adjusting the determination of the amount and time of fulfillment of Capital Surcharge are based on economic growth, credit growth, and/or the performance of the banking industry.

Article 12
Paragraph (1)
It is clear enough.
Paragraph (2)
It is clear enough.
Paragraph (3)
Force majeure situations include, among others, the failure of the Financial Services Authority reporting system.
The Financial Services Authority correspondence system with the address https://sipenaojk.ojk.go.id or another address designated by the Financial Services Authority.
Paragraph (4)
Force majeure situations include, among others, the failure of the Financial Services Authority correspondence system.
Paragraph (5)
It is clear enough.

Article 13
It is clear enough.

Article 14
Paragraph (1)
Recovery Plans are known by the term recovery plan.
Paragraph (2)
What is meant by "Bank under Deposit Insurance Corporation resolution action" is Intermediary Banks and Banks receiving temporary capital placement by the Deposit Insurance Corporation.

Article 15
Paragraph (1)
The obligation to obtain shareholder approval in the Annual General Meeting of Shareholders (AGMS) is intended so that the Recovery Plan includes the role of shareholders, particularly PSP, to improve financial conditions. Paragraph (2) It is clear enough.

Article 16
Paragraph (1)
It is clear enough.
Paragraph (2)
The opinion from the Sharia supervisory board contains that the Bank's Recovery Plan has met Sharia principles.
Paragraph (3)
It is clear enough.

Article 17
Letter a
What is meant by "realistic" includes, among others, measurable, in accordance with actual conditions, and/or implementable.
Letter b
It is clear enough.
Letter c
It is clear enough.
Letter d
It is clear enough.
Letter e
It is clear enough.

Article 18
Paragraph (1)
Approval from the Board of Commissioners over the Recovery Plan is given before shareholder approval in the AGMS.
Paragraph (2)
It is clear enough.

Article 19
Paragraph (1)
Letter a
It is clear enough.
Letter b
It is clear enough.
Letter c
Parties who play a role and are responsible for the implementation of the Recovery Plan include, among others, internal parties and other related parties, including relevant work units, in accordance with functions, authorities, and responsibilities established by the Bank. Paragraph (2) It is clear enough. Paragraph (3) The crisis management group can take the form of a special work unit or task force consisting of internal parties, and parties with competence to overcome the Bank's financial problems if necessary. Paragraph (4) It is clear enough.

Article 20
It is clear enough.

Article 21
It is clear enough.

Article 22
Letter a
It is clear enough.
Letter b
It is clear enough.
Letter c
What is meant by "recovery options" are the actions determined to be taken by the Bank to respond to financial stress experienced by the Bank in preventing, recovering, or improving financial conditions and the viability of the Bank's business. Letter d It is clear enough.

Article 23
It is clear enough.

Article 24
Letter a
It is clear enough.
Letter b
Subsidiary companies include the business group of the subsidiary company.
Letter c
It is clear enough.
Letter d
It is clear enough.
Letter e
It is clear enough.

Article 25
It is clear enough.

Article 26
It is clear enough.

Article 27
What is meant by "sister company" is several financial service institutions that are separated institutionally and/or legally but are owned and/or controlled by the same controlling shareholder.

Article 28
Paragraph (1)
It is clear enough.
Paragraph (2)
Intra-group financial support agreements include, among others, guarantees, loans, and commitments given or obtained by the Bank from its business group.
Paragraph (3)
Exposure includes, among others, the amount or share owned by the Bank.
Major business partners (counterparties) include, among others, customers, suppliers, and major contractors.
Paragraph (4)
It is clear enough.

Article 29
It is clear enough.

Article 30
Paragraph (1)
It is clear enough.
Paragraph (2)
Letter a
It is clear enough.
Letter b
What is meant by "trigger level" is the level where recovery options begin to be implemented.

Article 31
Paragraph (1)
Recovery Plan indicators established by the Bank must be able to represent and identify key vulnerabilities related to the financial problems faced by the Bank.
Paragraph (2)
It is clear enough.
Paragraph (3)
Letter a
It is clear enough.
Letter b
What is meant by "liquidity coverage ratio" is the liquidity coverage ratio (LCR) in accordance with Financial Services Authority regulations regarding the obligation to fulfill the liquidity coverage ratio for general banks. Letter c What is meant by "net stable funding ratio" is the net stable funding ratio (NSFR) in accordance with Financial Services Authority regulations regarding the obligation to fulfill the net stable funding ratio for general banks. Paragraph (4) It is clear enough. Paragraph (5) It is clear enough. Paragraph (6) It is clear enough.

Article 32
Paragraph (1)
Other indicators that are quantitative, including:
a. market-based indicators, including changes in Bank stock prices, rating downgrades; and b. macroeconomic indicators, including changes in exchange rates, changes in interest rates. Other indicators that are qualitative, including:
a. requests for acceleration of Bank debt repayment by business partners (counterparties); b. court decisions that have a negative impact on the Bank;
c. negative news or publications regarding the Bank; and
d. significant decline in the Bank's reputation.
Paragraph (2)
Recovery options against qualitative indicators aim to ensure that problems occurring at the Bank do not lead to and/or cause the worsening of the Bank's financial conditions.

Article 33
Paragraph (1)
It is clear enough.
Paragraph (2)
Examples of applicable legislation that can be used to establish trigger levels include regulations regarding minimum capital requirements, obligations to fulfill core capital (common equity tier 1), determination of status and follow-up of Bank supervision, obligations to fulfill the liquidity coverage ratio, and obligations to fulfill the net stable funding ratio. Paragraph (3) Letter a Example of prevention so that the Bank can continue to maintain the same or better size or ratio than applicable legislation for capital indicators, namely the minimum capital requirement ratio, the Bank establishes a trigger level so as not to violate additional capital requirements as a buffer (buffer) in the form of capital regulations related to the capital conservation buffer, countercyclical buffer, and capital surcharge for Systemic Banks. Letter b Example of recovery so that the Bank no longer violates the size or ratio of indicators in accordance with applicable legislation for capital indicators, namely the minimum capital requirement ratio, the Bank establishes a trigger level so as not to violate the fulfillment of minimum capital requirements in accordance with the risk profile. Letter c Example of improvement from conditions endangering the viability of the Bank for capital indicators, namely the minimum capital requirement ratio, the Bank establishes a trigger level so as not to violate the minimum capital requirement ratio of less than 8% (eight percent).

Article 34
Paragraph (1)
Letter a
The order of choice for implementing recovery options aims to enable the Bank to take appropriate actions to address financial problems faced, related to actions for prevention, recovery, or improvement from conditions endangering the viability of the Bank. Letter b It is clear enough. Letter c Analysis or assessment is carried out by identifying:

internal and external parties that may be affected by recovery options; and/or
internal and external parties involved in the implementation of recovery options.
Letter d
It is clear enough.
Paragraph (2)
Letter a
It is clear enough.
Letter b
It is clear enough.
Letter c
Assessment of the adequacy of operational support includes, among others, information technology systems and human resources, the Bank's internal operational analysis, the Bank's access and

subsidiary companies covered in the Recovery Action Plan on market infrastructure.
Market infrastructure includes clearing, settlement facilities, and payment systems.
Article 35
Paragraph (1)
Letter a
Capital additions for Banks that are obligations of the Parent Company (PSP) and/or Ultimate Parent Company (PSPT) can be carried out among others through:
a. capital deposits by the PSP and/or PSPT; b. deferring dividend distribution;
c. stock dividend distribution;
d. offsetting accumulated losses as shareholder expenses according to the order of shareholder responsibility based on the type of shares owned; e. issuing shares through a limited public offering (right issue); and/or f. issuing shares not through a public offering (private placement). Letter b Clearly stated. Letter c Capital additions for Banks that involve other parties can be carried out among others through:
a. issuing shares through a limited public offering (right issue); and/or b. issuing shares not through a public offering (private placement).
"Other parties" refers to parties other than the PSP and/or PSPT.
Paragraph (2)
Letter a
Clearly stated.
Letter b
"Investment" refers to investment instruments that have capital characteristics only found in Banks conducting business activities based on Sharia principles.
Paragraph (3)
Clearly stated.
Paragraph (4)
Clearly stated.
Paragraph (5)
Clearly stated.
Article 36
Paragraph (1)
Disbursement is carried out for handling Bank issues, or for PSP and/or PSPT that are no longer the PSP and/or PSPT of the Bank.
Paragraph (2)
Clearly stated.

Paragraph (3)
Ownership of debt instruments or investments with capital characteristics belonging to other parties can only be held by institutions or legal entities.
Individual investors are known as retail investors.
Paragraph (4)
Clearly stated.
Paragraph (5)
Savings ownership fulfillment is carried out against:
a. New PSPs including:

PSPT; and/or
affiliated parties of PSP and/or PSPT; and/or
b. Existing PSPs including:
PSPT; and/or
affiliated parties of PSP and/or PSPT.
Article 37
Clearly stated.
Article 38
Letter a
Submitting requests for short-term liquidity loans or short-term Sharia-based liquidity financing to Bank Indonesia in accordance with applicable regulations.
Letter b
Submitting requests for fund placement to the Deposit Insurance Corporation (LPS) in accordance with applicable regulations.
Letter c
Other recovery options include ownership of credit lines in the money market. A credit line is a facility that can be received by a Bank from other parties and can be used to anticipate and/or cover the Bank's liquidity needs when necessary.
Article 39
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Other recovery options include increasing collection activities.
Article 40
Letter a
Clearly stated.
Letter b
Clearly stated
Letter c
Other recovery options include the transfer of credit claims (cessie).

Article 41
Paragraph (1)
Letter a
"Internal parties" refers to all work units and all employees, especially those who will be involved in the implementation of the Recovery Action Plan.
Letter b
"External parties" refers to parties with a primary interest in the Bank, among others investors and business partners (counterparties).
Paragraph (2)
Clearly stated.
Article 42
Paragraph (1)
"Evaluation and testing (stress testing)" refers to the assessment of the Bank's condition at the time of implementation compared to the established Recovery Action Plan, as well as the assessment of the feasibility of the Recovery Action Plan to anticipate various stress conditions (scenarios) individually (idiosyncratic) and externally that occur in the overall financial market, which can be domestic or international (market-wide shock). Paragraph (2) Clearly stated. Paragraph (3) "Specific conditions that will significantly affect the Bank" refers to changes in the Bank's condition individually (idiosyncratic) and externally that occur in the overall financial market, which can be domestic or international (market-wide shock), that have the potential to endanger the Bank's going concern. Paragraph (4) Clearly stated. Paragraph (5) Clearly stated.
Article 43
Clearly stated.
Article 44
The implementation of the Recovery Action Plan aims to prevent, restore, or repair conditions that endanger the Bank's going concern.
Article 45
Clearly stated.
Article 46
Clearly stated.
Article 47
Paragraph (1)
Clearly stated.

Paragraph (2)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
"Adequacy and feasibility of savings and/or debt instruments or investments with capital characteristics owned by the Bank" refers to the availability, both in terms of amount and duration, of savings and/or debt instruments or investments with capital characteristics owned by the said Bank to face financial stress conditions. Paragraph (3) Clearly stated. Paragraph (4) Clearly stated.
Article 48
Clearly stated.
Article 49
Paragraph (1)
"Submission of the Recovery Action Plan" refers to the initial submission, update submission, and correction submission.
Paragraph (2)
Clearly stated.
Paragraph (3)
See explanation of Article 12 paragraph (3).
Paragraph (4)
See explanation of Article 12 paragraph (4).
Paragraph (5)
Clearly stated.
Article 50
Paragraph (1)
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
"Conducting business activities" refers to Banks conducting business activities due to the establishment of a new Bank or a Bank resulting from the separation (spin-off) of Sharia business units from a Bank conducting business activities on a conventional basis.
Article 51
Letter a
Clearly stated.
Letter b
Savings belonging to the Head Office from KCBLN include savings from other branches abroad and subsidiaries.
Letter c
Clearly stated.

Article 52
Certain considerations include paying attention to the condition of fulfilling the minimum capital adequacy ratio requirement at the Bank.
Article 53
Clearly stated.
Article 54
Clearly stated.
Article 55
Clearly stated.
Article 56
Clearly stated.
Article 57
Clearly stated.
Article 58
Clearly stated.
Article 59
Letter a
"Bank under normal supervision" refers to a supervisory status against a Bank that does not meet the criteria for a Bank under rehabilitation and does not meet the criteria for a Bank under resolution. Letter b "Bank under rehabilitation" refers to an increased supervisory status against a Bank that was previously under normal supervision, with the aim of restoring the Bank's condition. Actions to restore the Bank's condition are carried out by establishing supervisory actions appropriate to the Bank's issues. Letter c "Bank under resolution" refers to a Bank declared by the Financial Services Authority (OJK) as a Bank experiencing financial difficulties that endanger its going concern and cannot be rehabilitated according to the authority held by the Financial Services Authority.
Article 60
Paragraph (1)
Clearly stated.
Paragraph (2)
Letter a
Composite health level rating of the Bank in accordance with Financial Services Authority Regulations regarding the assessment of the health level of commercial banks and Financial Services Authority Regulations regarding the assessment of the health level of Sharia commercial banks and Sharia business units. "2 (two) consecutive assessment periods" refers to the assessment periods of the Bank's health level every semester for the end of June and end of December positions. Letter b GWM ratio in Rupiah in accordance with applicable regulations regarding minimum reserve requirements. Number 1 "Fundamental liquidity issues" refers to:
a) changes in the Bank's position in the money market from a net lender position to a net borrower position; b) worsening cash flow positions as a result of large maturity mismatches, especially on a short-term time scale; c) the Bank's efforts to obtain funds in the money market at interest rates or yields higher than fair interest rates or market interest rates; d) dependence on collateral to obtain funds; e) increased withdrawal of deposits before maturity; and/or f) other fundamental liquidity issues. Number 2 "Bank experiencing worsening liquidity development" refers to when the tendency of the Bank's GWM ratio is increasingly decreasing. Letter c The Bank's obligation to have a minimum capital adequacy ratio requirement in accordance with the Bank's risk profile in accordance with applicable regulations regarding minimum capital adequacy requirements for commercial banks and Financial Services Authority Regulations regarding minimum capital adequacy requirements for Sharia commercial banks.
Article 61
Letter a
Clearly stated.
Letter b
The duration of the end of the Deposit Insurance Corporation's fund placement in accordance with applicable regulations regarding the Deposit Insurance Corporation's fund placement.
Article 62
Paragraph (1)
Banks not designated into the status of Bank under rehabilitation are Banks that have non-structural issues and are believed to still meet the criteria for a Bank under normal supervision. Letter a Banks in the process of merger, consolidation, takeover, or integration are marked by the process of submitting information on the development of the draft merger, consolidation, takeover, or integration by the Bank to the Financial Services Authority and the draft merger, consolidation, takeover, or integration has obtained approval from the Board of Commissioners of each Bank involved in the merger, consolidation, takeover, or integration, in accordance with Financial Services Authority Regulations regarding the merger, consolidation, takeover, integration, and conversion of commercial banks. Letter b Capital deposit additions have at least been recorded in the criteria for capital deposit funds that meet the requirements in accordance with Financial Services Authority Regulations regarding minimum capital adequacy requirements for commercial banks and Financial Services Authority Regulations regarding minimum capital adequacy requirements for Sharia commercial banks. Capital deposit additions up to the minimum capital adequacy ratio requirement meet additional capital as a buffer as per the requirements in accordance with Financial Services Authority Regulations regarding minimum capital adequacy requirements for commercial banks and Financial Services Authority Regulations regarding minimum capital adequacy requirements for Sharia commercial banks. Capital additions for Banks can be carried out by the Bank's shareholders or come from new shareholders. Capital additions for Banks are carried out by considering potential losses and liquidity needs. Letter c The Bank's rehabilitation action plan focuses on action plans capable of resolving the issue conditions so that the Bank does not meet the criteria for a Bank under rehabilitation. Paragraph (2) Clearly stated.
Article 63
Letter a
Number 1
The Financial Services Authority's assessment that a Bank cannot be rehabilitated according to the authority of the Financial Services Authority includes among others the application of the Recovery Action Plan during the period of the Bank under rehabilitation has no longer made it possible to increase the minimum capital adequacy ratio requirement to at least in accordance with the risk profile. Number 2 "Applicable regulations" refers to applicable regulations regarding minimum reserve requirements. Letter b Clearly stated.

Letter c
Clearly stated.
Article 64
Letter a
"Data/documents" refers to all types of data or documents, whether written or electronic, related to the objects of supervision of the Financial Services Authority.
"Every place related to the Bank" refers to every part of the room in the Bank's office and other places outside the Bank related to the objects of supervision of the Financial Services Authority. Letter b "Every party" refers to individuals or legal entities that have influence over the Bank's decision-making and operations, both directly and indirectly, among others PSPT or specific parties whose names are not listed as employees, managers, or shareholders of the Bank or equivalent but can influence the Bank's operational activities or management decisions. Letter c Specific accounts include among others savings accounts and credit accounts or financing accounts based on Sharia principles. Blocking of specific accounts is carried out against specific accounts used for illegal, contrary, and/or unlawful activities. Letter d Specific actions include among others when there are deviations in the Bank's business activities and violations of applicable regulations, by ordering the Bank to take specific actions deemed necessary by the Financial Services Authority.
Article 65
Clearly stated.
Article 66
Paragraph (1)
Other parties include among others agencies, ministries, and/or institutions that have duties and authorities in accordance with applicable regulations.
Paragraph (2)
Clearly stated.
Paragraph (3)
Clearly stated.
Paragraph (4)
Clearly stated.
Article 67
Clearly stated.
Article 68
Paragraph (1)
A Bank experiences difficulties endangering its going concern when the Bank's business conditions worsen, among others marked by decreasing capital, asset quality, liquidity, and profitability, as well as Bank management not conducted based on prudential principles and sound banking principles. Paragraph (2) Letter a Clearly stated. Letter b The action plan contains improvement steps to be carried out by the Bank in order to overcome the issues faced along with target times for resolving the issues. Paragraph (3) The opinion of the Sharia supervisory board contains that the action plan has met Sharia principles. Paragraph (4) Clearly stated. Paragraph (5) Rehabilitation steps established by the Financial Services Authority include among others issuing written orders and/or through other mechanisms based on the law regarding the Financial Services Authority. Paragraph (6) Clearly stated. Paragraph (7) Clearly stated. Paragraph (8) Clearly stated.
Article 69
Clearly stated.
Article 70
Letter a
Limiting authority includes among others limiting decisions on granting bonuses or performance shares, granting dividends to Bank owners, or salary increases for Bank employees and managers. Letter b Clearly stated. Letter c Clearly stated. Letter d Clearly stated. Letter e Clearly stated. Letter f Clearly stated. Letter g Clearly stated. Letter h "Other parties" refers to parties outside the relevant Bank, including other Banks, other business entities, or individuals who meet the requirements.

Letter i
Clearly stated.
Letter j
Clearly stated.
Letter k
Clearly stated.
Letter l
Clearly stated.
Letter m
Clearly stated.
Letter n
Other steps deemed necessary by the Financial Services Authority include among others:

limiting the payment of remuneration or other forms equivalent to it to members of the Board of Directors, Board of Commissioners, and/or Sharia supervisory board, or remuneration to related parties;
not carrying out repayment or settlement of additional core capital instruments or supplementary capital instruments;
not carrying out or delaying profit distribution;
limiting the implementation of product issuance plans and/or new activities;
not carrying out or limiting asset growth, participation, and/or new fund provision;
not carrying out network office expansion; and/or
closing the Bank's network offices.
Article 71
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
"Written instruction" refers to written instructions in accordance with Financial Services Authority Regulations regarding written orders.
"Written order" refers to written orders in accordance with Financial Services Authority Regulations regarding written orders.
Number 1
Letter a)
Clearly stated.
Letter b)
Number 1)
"Having" refers to:
a. shareholders who individually or together with other related shareholders; b. shareholders who act on behalf of other shareholders causing said shareholders; or
c. shareholders who have option rights or other rights to have shares that
if used will cause said shareholders, to have Bank shares of 10% (ten percent) or more.
Shareholders who together with other related shareholders include shareholders who have connections with other shareholders in the form of ownership relationships, family relationships up to the second degree, and/or carrying out cooperation to achieve common goals in controlling the Bank (acting in concert). Number 2) Clearly stated. Number 2 Clearly stated. Number 3 Due diligence, exploration with other Banks, and/or exploration with investors by the Deposit Insurance Corporation is carried out for Bank resolution preparation.
Article 72
Paragraph (1)
Actions to increase the Bank's status are intended to allow the Bank to exit the status of Bank under rehabilitation.
Paragraph (2)
Clearly stated.
Paragraph (3)
Clearly stated.
Article 73
Paragraph (1)
Notification to all network offices owned is carried out at least at branch offices, sub-branch offices, and functional offices that conduct operational activities.
Paragraph (2)
Clearly stated.
Article 74
Clearly stated.
Article 75
Paragraph (1)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Clearly stated.
Letter d
Clearly stated.
Letter e
Clearly stated.

Letter f
The group structure report contains individual persons and/or legal entities holding Bank shares up to the PSPT.
Letter g
"Cash flow projection report" refers to reports in accordance with Financial Services Authority Regulations regarding the implementation of risk management for commercial banks and Financial Services Authority Regulations regarding the implementation of risk management for Sharia commercial banks and Sharia business units. Letter h Clearly stated. Paragraph (2) Clearly stated.
Article 76
Specific actions ordered by the Financial Services Authority include among others:
a. orders to carry out paid-in capital additions; and/or b. orders to carry out specific transactions that meet the criteria:

materiality of specific transactions; and/or
affiliate transactions and/or transactions containing conflicts of interest.
Exceptions to Financial Services Authority Regulations in the capital market field include among others Financial Services Authority Regulations regarding pre-emptive rights, material transactions, affiliate transactions, and/or transactions containing conflicts of interest.
Article 77
Clearly stated.
Article 78
Fulfillment of normal supervision status criteria includes paying attention to the Bank's financial resilience conditions and potential financial deterioration.
Article 79
Paragraph (1)
Letter a
See explanation of Article 71 letter c. Written instructions include cease and desist orders.
Letter b
See explanation of Article 71 letter c.
Paragraph (2)
Clearly stated.
Paragraph (3)
Letter a
Specific actions by the Board of Directors and Board of Commissioners to ensure the resolution or repair of deviations and/or fulfillment of regulations.
Letter b
Clearly stated.

Paragraph (4)
Clearly stated.
Article 80
Clearly stated.
Article 81
Changes in the Bank's supervisory status come from changes in the Bank's status from normal supervision to Bank under rehabilitation, or Bank under rehabilitation to Bank under resolution, or vice versa. Notification of the determination of a Bank under resolution to the Deposit Insurance Corporation is carried out for the resolution or handling of the Bank under resolution according to the authority of the Deposit Insurance Corporation.
Article 82
Clearly stated.
Article 83
Clearly stated.
Article 84
Handover and notification are carried out by considering potential risks that may occur. Therefore, to avoid time gaps that can be abused in the illegal transfer of assets by parties interested in the Bank, handover and notification are also carried out directly via electronic media.
Article 85
Clearly stated.
Article 86
Clearly stated.
Article 87
The Deposit Insurance Corporation's choice of rescue form is carried out in accordance with applicable regulations.
Article 88
Clearly stated.
Article 89
Paragraph (1)
Clearly stated.
Paragraph (2)
See explanation of Article 12 paragraph (3).
Paragraph (3)
See explanation of Article 12 paragraph (4).
Paragraph (4)
Clearly stated.
Article 90
Clearly stated.

Article 91
Clearly stated.
Article 92
Clearly stated.
Article 93
Clearly stated.
Article 94
Clearly stated.
Article 95
Clearly stated.
Article 96
Paragraph (1)
More than 1 (one) Intermediary Bank can be established at the same time or at different times.
Paragraph (2)
Clearly stated.
Article 97
Clearly stated.
Article 98
Clearly stated.
Article 99
Paragraph (1)
The amount of basic capital for the establishment of a limited liability company refers to the law regarding limited liability companies.
Paragraph (2)
Clearly stated.
Article 100
Letter a
Number 1
Clearly stated.
Number 2
Clearly stated.
Number 3
Clearly stated.
Number 4
Clearly stated.
Number 5
The authority, responsibility, and term of office of members of the Sharia supervisory board are submitted if the Intermediary Bank conducts business activities based on Sharia principles. Number 6 Clearly stated. Letter b Clearly stated.

Letter c
Fulfillment of organizational structure and human resource requirements can use a statement letter from the Deposit Insurance Corporation that the requirements will be fulfilled using data and/or documents of the Source Bank whose assets and/or liabilities will be transferred in part or in whole, and the fulfillment of these requirements will be submitted at the latest by the Deposit Insurance Corporation at the time of submitting the business license application.
Article 101
Clearly stated.
Article 102
Clearly stated.
Article 103
Clearly stated.
Article 104
Clearly stated.
Article 105
Clearly stated.
Article 106
Paragraph (1)
Letter a
Organizational structure includes among others organizational structure, accountability mechanisms, and positions and names of human resources.
Positions and names of human resources consist of:

candidates for members of the Board of Directors;
candidates for members of the Board of Commissioners;
candidates for members of the Sharia supervisory board for Intermediary Banks conducting business activities based on Sharia principles; and
executive officials.
Letter b
Fulfillment includes among others:
forms or documents to be used for Intermediary Bank operations;
tax identification number;
business registration number;
standard operating procedures, governance guidelines, and risk management guidelines;
business plan;
information technology system plan to be used; and
latest proforma financial data of the Intermediary Bank, namely financial position reports, profit and loss reports and other comprehensive income reports, changes in equity reports, minimum capital adequacy requirement calculations, and financial ratios.
Infrastructure includes among others lists of fixed assets and inventory.

Paragraph (2)
Clearly stated.
Paragraph (3)
Clearly stated.
Paragraph (4)
Clearly stated.
Article 107
Clearly stated.
Article 108
Clearly stated.
Article 109
Paragraph (1)
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
The Deposit Insurance Corporation's request is based on considerations among others that the Intermediary Bank is still in the process of obtaining permits from other agencies in the implementation of the Intermediary Bank's business activities.
Article 110
Paragraph (1)
Specific conditions include among others crisis threat conditions or systemic financial crises as referred to in the law regarding the development and strengthening of the financial sector. Paragraph (2) Clearly stated.
Article 111
Clearly stated.
Article 112
Paragraph (1)
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
Implementation of assessment/fitness and propriety tests in accordance with Financial Services Authority Regulations regarding fitness and propriety assessment for key parties of financial service institutions. Paragraph (4) Clearly stated.
Article 113
Paragraph (1)
The Financial Services Authority has not given approval for the fitness and propriety assessment among others considering the ongoing fitness and propriety assessment process, and the need to accelerate the implementation of the Intermediary Bank's business activities.

Temporary approval does not reduce the assessment of the relevant person's ability and competence in carrying out actions, duties, and functions as members of the Board of Directors, members of the Board of Commissioners, and members of the Sharia Supervisory Board.

Paragraph (2)
The implementation of ability and propriety assessments shall be in accordance with the regulations of the Financial Services Authority regarding ability and propriety assessments for key parties of financial service institutions.

Paragraph (3)
Is sufficiently clear.

Paragraph (4)
Is sufficiently clear.

Paragraph (5)
Is sufficiently clear.

Article 114
The facilities and infrastructure of the Originating Bank include, among others, office networks, human resources, information technology systems, governance guidelines, risk management guidelines, work procedures, and/or other operational completeness of the Originating Bank.

Article 115
Paragraph (1)
Is sufficiently clear.

Paragraph (2)
What is meant by "specific conditions" is conditions based on the consideration of the Deposit Insurance Corporation, where 1 (one) Intermediary Bank can be used to accept the transfer of part or all of the assets and/or liabilities of more than 1 (one) Originating Bank.

Article 116
Is sufficiently clear.

Article 117
Is sufficiently clear.

Article 118
Paragraph (1)
Is sufficiently clear.

Paragraph (2)
Letter a
Is sufficiently clear.

Letter b
Transfer procedures and mechanisms include, among others, office networks, human resources, information technology systems, governance guidelines, risk management guidelines, work procedures, and/or operational completeness to be used by the Intermediary Bank after the transfer of part or all of the assets and/or liabilities from another Originating Bank to the Intermediary Bank.

Article 119
Is sufficiently clear.

Article 120
Paragraph (1)
Is sufficiently clear.

Paragraph (2)
Is sufficiently clear.

Paragraph (3)
Meet applicable criteria and requirements, including the existence of products and activities of the Originating Bank to be used by the Intermediary Bank, which require prior licensing from other authorities.

Article 121
Provisions regarding the fulfillment of minimum capital provision and minimum core capital obligations for Banks include, among others:
a. Financial Services Authority Regulations regarding minimum capital provision obligations for commercial banks; b. Financial Services Authority Regulations regarding minimum capital provision obligations for Sharia commercial banks; and
c. Financial Services Authority Regulations regarding the consolidation of commercial banks.

Article 122
Other policies in the assessment of the health level of the Intermediary Bank include, among others, the assessment period and the scope of the health level assessment of the Intermediary Bank.

Article 123
Regulatory provisions include, among others:
a. laws regarding the prevention and handling of financial system crises; b. laws regarding the development and strengthening of the financial sector; and
c. laws regarding the Deposit Insurance Corporation.

Article 124
Paragraph (1)
Letter a
Regulatory provisions include, among others, laws regarding banking, laws regarding Sharia banking, laws regarding limited liability companies, as well as regulatory provisions regarding commercial banks and Sharia commercial banks.

Letter b
Is sufficiently clear.

Letter c
Is sufficiently clear.

Letter d
Financial obligations include, among others, fulfilling minimum capital provision obligations up to additional capital as a buffer in accordance with the Financial Services Authority Regulations regarding minimum capital provision obligations for commercial banks and the Financial Services Authority Regulations regarding minimum capital provision obligations for Sharia commercial banks.

Paragraph (2)
Letter a
Is sufficiently clear.

Letter b
Supervisory actions mandated by the Financial Services Authority include, among others, if a Bank originating from an Intermediary Bank does not fulfill provisions as stipulated in regulations related to the Bank.

Article 125
Is sufficiently clear.

Article 126
Paragraph (1)
Is sufficiently clear.

Paragraph (2)
Regulatory provisions include, among others, regarding the revocation of business licenses upon request by the owner or shareholders of commercial banks and Sharia commercial banks.

Paragraph (3)
Is sufficiently clear.

Article 127
Is sufficiently clear.

Article 128
Is sufficiently clear.

Article 129
Paragraph (1)
Is sufficiently clear.

Paragraph (2)
See the explanation of Article 12 paragraph (3).

Paragraph (3)
See the explanation of Article 12 paragraph (4).

Paragraph (4)
Is sufficiently clear.

Article 130
Is sufficiently clear.

Article 131
Is sufficiently clear.

Article 132
Is sufficiently clear.

Article 133
Is sufficiently clear.

Article 134
Is sufficiently clear.

Article 135
Is sufficiently clear.

Article 136
Is sufficiently clear.

Article 137
Is sufficiently clear.

Article 138
Is sufficiently clear.

Article 139
Is sufficiently clear.

Article 140
Is sufficiently clear.

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 75/OJK

Regulation of the Financial Services Authority of the Republic of Indonesia Number 5 of 2024 Concerning the Determination of Supervisory Status and Handling of Issues of Commercial Banks

Lineage: In force