Regulation of the Financial Services Authority of the Republic of Indonesia Number 41/POJK.03/2019 concerning Merger, Amalgamation, Takeover, Integration, and Conversion of Universal Banks

COPY
FINANCIAL SERVICES AUTHORITY REGULATION
OF THE REPUBLIC OF INDONESIA
NUMBER 41/POJK.03/20192019
CONCERNING
MERGER, AMALGAMATION, TAKEOVER, INTEGRATION,
AND CONVERSION OF UNIVERSAL BANKS
BY THE GRACE OF THE ALMIGHTY GOD
THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY, Considering:
a. that with the shift of functions, duties, and authority for the regulation and supervision of financial services activities in the banking sector from Bank Indonesia to the Financial Services Authority; b. that to support economic growth and national stability, a strong and competitive national banking industry structure is required;
c. that to create a strong and competitive national banking industry structure capable of responding to increasingly dynamic and complex future challenges, strong, efficient, and competitive banks are needed through merger, amalgamation, takeover, integration, and conversion;
d. that current regulations regarding merger, amalgamation, and takeover are deemed outdated in light of developments and thus require regulation updates;

e. that based on the considerations referred to in letters a through d, it is necessary to establish a Financial Services Authority Regulation concerning Merger, Amalgamation, Takeover, Integration, and Conversion of Universal Banks; Considering:

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 by Law Number 10 of 1998 concerning Amendments to Law Number 7 of 1992 concerning Banking (State Gazette of the Republic of Indonesia Year 1998 Number 182, Supplement to the State Gazette of the Republic of Indonesia Number 3790);
2. Law Number 8 of 1995 concerning Capital Markets (State Gazette of the Republic of Indonesia Year 1995 Number 64, Supplement to the State Gazette of the Republic of Indonesia Number 3608);
3. Law Number 40 of 2007 concerning Limited Liability Companies (State Gazette of the Republic of Indonesia Year 2007 Number 106, Supplement to the State Gazette of the Republic of Indonesia Number 4756);
4. 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);
5. 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);
   DECIDING:
   Establishing: FINANCIAL SERVICES AUTHABILITY REGULATION CONCERNING MERGER, AMALGAMATION, TAKEOVER, INTEGRATION, AND CONVERSION OF UNIVERSAL BANKS.

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

1. Universal Bank, hereinafter referred to as Bank, is a Bank that conducts conventional business activities or conducts business activities based on Sharia principles, which in its activities provides services in the payment transaction system, excluding branch offices of banks located outside the country.
2. Conventional Universal Bank, hereinafter abbreviated as BUK, is a Bank that conducts business activities conventionally.
3. Sharia Universal Bank, hereinafter abbreviated as BUS, is a Bank that conducts business activities based on Sharia principles.
4. Branch Office of a Bank Located Outside the Country, hereinafter abbreviated as KCBLN, is a branch office of a bank with legal domicile and headquarters located outside the country.
5. Merger is a legal act performed by one or more Banks to merge with an existing Bank, resulting in the assets, liabilities, and equity of the merging Bank transferring by operation of law to the receiving Bank, and subsequently the legal status of the merging Bank ending by operation of law.
6. Amalgamation is a legal act performed by two or more Banks to amalgamate by establishing a new Bank, which by operation of law acquires the assets, liabilities, and equity of the amalgamating Banks, and the legal status of the amalgamating Banks ends by operation of law.
7. Takeover is a legal act performed by a legal entity or individual to take over Bank shares, resulting in the transfer of control over that Bank.
8. Integration is a legal act performed by a KCBLN and a Bank by transferring the assets and/or liabilities of the KCBLN by operation of law to the Bank, and subsequently the business license of the KCBLN is revoked.
9. Conversion is a legal act performed by a KCBLN to change the business license of the KCBLN to a Bank business license, and subsequently the business license of the KCBLN is revoked.
10. Financial Services Authority, hereinafter abbreviated as OJK, is an independent agency having the functions, duties, and authority for regulation, supervision, examination, and investigation.
11. Control is an action aimed at influencing the management and/or policy of a company, including a Bank, in any manner, whether directly or indirectly.
12. General Meeting of Shareholders, hereinafter abbreviated as GMS, is the organ of the Bank having authority not granted to the Board of Directors or Board of Commissioners within the limits determined by the Law concerning Limited Liability Companies and/or the Articles of Association.
13. 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 with voting rights of a company or Bank, or owns less than 25% (twenty-five percent) of the issued shares with voting rights but can be proven to have exercised Control over the company or Bank, whether directly or indirectly.
14. Board of Directors is the organ of the Bank authorized and fully responsible for managing the Bank for the interests 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 provisions of the Articles of Association, or the head of the branch office and one level below the head of the branch office for KCBLN.
15. Board of Commissioners is the organ of the Bank tasked with conducting general and/or specific supervision in accordance with the Articles of Association and providing advice to the Board of Directors, or the party appointed to perform the supervision function for KCBLN.
16. Minister is the minister responsible for law and human rights.
17. Website is a collection of web pages containing information or data accessible through an internet network system.

Article 2
(1) Merger, Amalgamation, Takeover, Integration, and Conversion may be carried out based on:
a. the initiative of the respective Bank and KCBLN; or b. OJK supervisory action.
(2) Merger, Amalgamation, Takeover, Integration, and Conversion as referred to in paragraph (1) must obtain OJK approval in accordance with the requirements and procedures regulated in this Financial Services Authority Regulation.

Article 3
(1) Merger or Amalgamation may be conducted between:
a. BUK and BUK, resulting in a BUK; b. BUS and BUS, resulting in a BUS; or
c. BUK and BUS, resulting in a BUS.
(2) Integration may be conducted between:
a. KCBLN and BUK resulting in a BUK; or b. KCBLN and BUS resulting in a BUS.

Article 4
(1) A BUS may conduct a Takeover of a BUK provided that the application for Takeover approval is submitted to OJK simultaneously with the application for changing the business activities of the BUK to a BUS. (2) Takeover approval may only be granted after the BUK has obtained approval for changing business activities to a BUS as referred to in paragraph (1).

Article 5
(1) A BUS that is the result of:
a. Merger or Amalgamation as referred to in Article 3 paragraph (1) letter c; or b. Integration as referred to in Article 3 paragraph (2) letter b, must settle the rights and obligations of conventional business activities no later than 1 (one) year since the Merger, Amalgamation, or Integration approval becomes effective. (2) If the settlement of rights and obligations of conventional business activities cannot be completed within the settlement time limit as referred to in paragraph (1), the settlement of rights and obligations of conventional business activities may be extended with OJK approval.

Article 6
(1) A Bank intending to conduct Merger, Amalgamation, Takeover, or Integration must make a statement to OJK and GMS that the Merger, Amalgamation, Takeover, or Integration is conducted with due regard to the interests of the Bank, society, healthy competition in conducting business, and the guarantee that the rights of shareholders and employees remain fulfilled in accordance with applicable laws and regulations. (2) The statement as referred to in paragraph (1) is signed by:
a. the President Director; or b. 1 (one) or more members of the Board of Directors representing the Bank as regulated in the Articles of Association.
(3) A KCBLN intending to conduct Integration or Conversion must make a statement to OJK that the Integration or Conversion is conducted with due regard to the interests of the KCBLN, society, healthy competition in conducting business, and the guarantee that employee rights remain fulfilled in accordance with applicable laws and regulations. (4) The statement as referred to in paragraph (3) is signed by:
a. the party or official authorized at the KCBLN headquarters; or b. the Board of Directors of the KCBLN appointed or receiving power of attorney from the KCBLN headquarters.

Article 7
(1) A Bank or KCBLN that does not meet the provisions as regulated in Article 2 paragraph (2), Article 5 paragraph (1), and/or Article 6 is subject to administrative sanctions in the form of a written reprimand. (2) In the event that a Bank or KCBLN has been subject to administrative sanctions as referred to in paragraph (1), the Bank or KCBLN may be subject to administrative sanctions in the form of:
a. prohibition on expanding business activities; b. suspension of certain business activities; and/or
c. prohibition as a principal party in accordance with the Financial Services Authority Regulation concerning the re-evaluation of the principal party of a financial services institution.

CHAPTER II
REQUIREMENTS AND PROCEDURES FOR MERGER OR AMALGAMATION
Article 8
(1) The Board of Directors of each Bank intending to conduct Merger or Amalgamation jointly drafts the Merger or Amalgamation plan.
(2) The Bank submits information on the progress of drafting the Merger or Amalgamation plan as referred to in paragraph (1) to OJK.
(3) The Merger or Amalgamation plan as referred to in paragraph (1) must obtain approval from the Board of Commissioners of each respective Bank.

Article 9
The Merger or Amalgamation plan as referred to in Article 8 must contain at least the following information:
a. information regarding each Bank conducting Merger or Amalgamation:

1. name, domicile, office network, business activities/products/activities, organizational structure, capital structure and shareholders, and composition and names of Board of Directors, Board of Commissioners, and Sharia Supervisory Board members;
2. report on the condition, development, and results achieved by each Bank conducting Merger or Amalgamation; and
3. financial statements and financial performance information for the last 3 (three) fiscal years audited by a public accountant for each Bank conducting Merger or Amalgamation;
   b. information regarding the Merger or Amalgamation plan:
4. schedule of the plan and estimated date of effectiveness of the Merger or Amalgamation;
5. reasons and explanations for conducting the Merger or Amalgamation by each respective Bank;
6. plan for continuing or terminating business activities of the Bank conducting Merger or Amalgamation;
7. information for the current fiscal year, containing at least:
   a) financial statements and interim financial performance information; b) changes in main business activities of each Bank conducting Merger or Amalgamation, if any; and c) details of problems arising during the current fiscal year affecting the activities of the Bank conducting Merger or Amalgamation, if any;
8. method for valuing and converting shares of each Bank conducting Merger or Amalgamation into shares of the resulting Bank;
9. method for settling the rights and obligations of the Bank conducting Merger or Amalgamation with third parties;
10. plan for settling rights and obligations of conventional business activities no later than 1 (one) year for Merger or Amalgamation as referred to in Article 5 paragraph (1);
11. method for settling the rights of shareholders who disagree with the Merger or Amalgamation;
12. method for settling the status, rights, and obligations of Board of Directors, Board of Commissioners, Sharia Supervisory Board members, and employees of the Bank conducting Merger or Amalgamation;
13. legal consultant opinion regarding the legal aspects of the Merger or Amalgamation;
14. summary of the independent appraiser's report regarding the fairness opinion on the Merger or Amalgamation;
15. conflicts of interest between the Bank conducting Merger or Amalgamation and members of the Board of Directors, Board of Commissioners, or Sharia Supervisory Board, if any; and
16. results of expert assessments regarding specific aspects of the Merger or Amalgamation, if required; and
    c. information regarding the resulting Bank from Merger or Amalgamation:
17. name, domicile, office network status, business activities/products/activities, organizational structure, capital structure and shareholders, organizational structure, composition of Board of Directors, Board of Commissioners, and Sharia Supervisory Board members, as well as information technology, and human resources;
18. plan for name and logo changes;
19. proforma financial data audited by a public accountant;
20. projection of the Bank's health level for 2 (two) assessment periods with a minimum Composite Rating 3 (CR-3), and action plan containing improvement steps if the projected Bank health level for 2 (two) assessment periods is lower than Composite Rating 3 (CR-3);
21. explanation of benefits and risks that may arise from the Merger or Amalgamation along with risk mitigation;
22. salaries, honoraria, and other allowances for members of the Board of Directors, Board of Commissioners, and Sharia Supervisory Board;
23. affirmation from the Bank conducting Merger or Amalgamation that the resulting Bank from Merger or Amalgamation accepts the transfer of all rights and obligations of the Bank conducting Merger or Amalgamation;
24. draft amendment to the Articles of Association of the resulting Bank from Merger or draft deed of establishment of the new Bank from Amalgamation; and
25. business plan.

Article 10
(1) The Board of Directors of a Bank intending to conduct Merger or Amalgamation must announce a summary of the Merger or Amalgamation plan to the public no later than:
a. 2 (two) working days after receiving Board of Commissioners approval for the Merger or Amalgamation plan as referred to in Article 8 paragraph (3); and b. 30 (thirty) days before the GMS summons. (2) The announcement as referred to in paragraph (1) must contain at least:
a. a summary of the Merger or Amalgamation plan as referred to in Article 9; and b. information that the Merger or Amalgamation plan has not yet received GMS approval.
(3) The announcement as referred to in paragraph (1) must be conducted at least through:
a. 1 (one) daily newspaper in Indonesian with national circulation; and b. the Bank's Website.
(4) Proof of announcement as referred to in paragraph (3) must be submitted to OJK no later than 2 (two) working days after the announcement.

Article 11
Simultaneously with the announcement of the summary of the Merger or Amalgamation plan as referred to in Article 10, the Bank must submit to OJK:
a. the Merger or Amalgamation plan document as referred to in Article 9 which has received Board of Commissioners approval; b. the draft deed of Merger or Amalgamation; and
c. administrative requirement documents:

1. for the purpose of assessing competence and propriety for:
   a) prospective members of the Board of Directors and prospective members of the Board of Commissioners of the resulting Bank from Merger or Amalgamation contained in the Merger or Amalgamation plan as referred to in Article 9 letter c number 1; and b) prospective CSP in the event that Merger or Amalgamation is accompanied by replacement or change of CSP; and
2. documents for the purpose of interviews for prospective members of the Sharia Supervisory Board of the resulting Bank from Merger or Amalgamation contained in the Merger or Amalgamation plan as referred to in Article 9 letter c number 1, in the event that the resulting Bank from Merger or Amalgamation is a BUS.

Article 12
A Bank intending to conduct Merger or Amalgamation must announce in writing to employees of the Bank conducting Merger or Amalgamation, simultaneously with the announcement of the summary of the Merger or Amalgamation plan as referred to in Article 10.

Article 13
(1) Creditors may submit objections to the Bank regarding the implementation of Merger or Amalgamation within a time limit of no later than 14 (fourteen) days after the announcement of the summary of the Merger or Amalgamation plan as referred to in Article 10. (2) If within the time limit as referred to in paragraph (1) creditors do not submit objections, creditors are deemed to have approved the Merger or Amalgamation. (3) In the event that creditor objections as referred to in paragraph (1) cannot be resolved by the Board of Directors by the date the GMS is held, the objections must be submitted in the GMS for resolution. (4) Resolution by the Board of Directors or GMS as referred to in paragraph (3) may be in the form of resolving objections or establishing a resolution scheme agreed upon by the Bank and creditors, contained in a deed made by a notary in Indonesian. (5) Until the resolution as referred to in paragraph (4) is reached, the Merger or Amalgamation cannot be implemented.

Article 14
A Bank intending to conduct Merger or Amalgamation requests GMS approval of each respective Bank regarding:
a. the Merger or Amalgamation to be conducted by the Bank; b. the Merger or Amalgamation plan; and
c. the draft deed of Merger or Amalgamation.

Article 15
(1) Shareholders who disagree with the GMS decision as referred to in Article 14 may only exercise their right to request their shares be purchased at a fair price by the Bank. (2) The exercise of the right as referred to in paragraph (1) does not stop the implementation process of the Merger or Amalgamation.

Article 16
(1) GMS approval as referred to in Article 14 is stipulated in a Merger or Amalgamation deed made by a notary in Indonesian.
(2) In the event of changes to the Articles of Association of the resulting Bank from Merger, the changes to the Articles of Association are stated in a deed made by a notary in Indonesian. (3) The Amalgamation deed as referred to in paragraph (1) serves as the basis for creating the deed of establishment of the resulting Bank from Amalgamation.

Article 17
(1) The Board of Directors of each Bank intending to conduct Merger or Amalgamation jointly submits an application for Merger or Amalgamation approval of the Bank to OJK no later than 3 (three) working days after the GMS decision approving the Merger or Amalgamation. (2) The application for Merger or Amalgamation approval as referred to in paragraph (1) is submitted to OJK accompanied by:
a. the GMS minutes made with a notarial deed containing approval for Merger or Amalgamation; b. the Merger or Amalgamation plan approved by GMS;
c. the Merger or Amalgamation deed as referred to in Article 16 paragraph (1);
d. the amendment to the Articles of Association of the resulting Bank from Merger or the deed of establishment of the resulting Bank from Amalgamation as referred to in Article 16 paragraph (2) and paragraph (3); and e. the latest financial statements and financial performance information of the Bank conducting Merger or Amalgamation in the event that the application for Merger or Amalgamation approval is submitted within a period of 6 (six) months or more since the announcement of the summary of the Merger or Amalgamation plan to the public as referred to in Article 10. (3) If necessary, OJK may request additional documents and/or information from the Bank conducting Merger or Amalgamation.

Article 18
(1) OJK provides approval or rejection for the application for Merger or Amalgamation approval as referred to in Article 17.
(2) Approval or rejection as referred to in paragraph (1) is provided within a time limit of 14 (fourteen) working days since the documents as referred to in Article 17 paragraph (2) and paragraph (3) are received in complete form. (3) In providing approval or rejection for the application for Merger or Amalgamation approval as referred to in paragraph (2), OJK conducts:
a. examination of the completeness and truthfulness of documents as referred to in Article 17 paragraph (2) and paragraph (3); b. assessment of competence and propriety for:

1. prospective members of the Board of Directors and prospective members of the Board of Commissioners of the resulting Bank from Merger or Amalgamation; and
2. prospective CSP in the event that Merger or Amalgamation is accompanied by replacement or change of CSP;

c. interviews with prospective members of the Sharia Supervisory Board, in the event that the resulting Bank from Merger or Amalgamation is a BUS; and
d. analysis of the latest financial performance of the Bank conducting Merger or Amalgamation.
(4) In the event that OJK approves the application for Merger or Amalgamation approval, OJK establishes:
a. the results of the assessment of competence and propriety for prospective members of the Board of Directors and prospective members of the Board of Commissioners of the resulting Bank from Merger or Amalgamation; b. the results of the assessment of competence and propriety for prospective CSP for Merger or Amalgamation accompanied by replacement or change of CSP; and
c. the results of interview assessments for prospective members of the Sharia Supervisory Board, for the resulting Bank from Merger or Amalgamation that is a BUS.
(5) In the event that OJK rejects the application for Merger or Amalgamation approval, the rejection is accompanied by written reasons.

Article 19
(1) After obtaining OJK approval as referred to in Article 18, the Bank submits:
a. amendment to the Articles of Association of the resulting Bank from Merger as referred to in Article 16 paragraph (2) to the Minister no later than 30 (thirty) days calculated from the date of the notarial deed containing the amendment to the Articles of Association, to obtain approval or as notification to the Minister; or b. application for legal entity approval of the resulting Bank from Amalgamation to the Minister no later than 60 (sixty) days since the date of the deed of establishment as referred to in Article 16 paragraph (3).

(2) The submission to the Minister as referred to in paragraph (1) is accompanied by a copy of the Deed of Merger or Consolidation.

Article 20
The Merger or Consolidation License is valid:
a. since:

1. the date of the Minister's approval or a later date determined in the Minister's approval; or
2. the date the notification of amendment to the Articles of Association is received by the Minister, or a later date determined in the Deed of Merger,
   if the Merger is accompanied by an amendment to the Articles of Association; b. since the date the notification is received by the Minister for recording in the company register, if the Merger is not accompanied by an amendment to the Articles of Association; or
   c. since the date of the Minister's decision regarding the legalization of the legal entity of the Bank resulting from the Consolidation.

Article 21
A Bank that has obtained a Merger or Consolidation License is required to:
a. prepare a closing financial position report for each Bank conducting the Merger or Consolidation; b. prepare an opening financial position report for the Bank resulting from the Merger or Consolidation;
c. announce the results of the Merger or Consolidation within a maximum period of 30 (thirty) days calculated from the date the Merger or Consolidation becomes effective through:

1. 1 (one) daily newspaper in the Indonesian language with national circulation; and
2. The Bank's Website;
   d. submit a report on the implementation of the Merger or Consolidation to the OJK no later than 5 (five) working days after the date the Merger or Consolidation becomes effective, attached with:
3. a photocopy of the deed amending the Articles of Association of the Bank that has been approved or notified to the Minister, in the event the Merger is accompanied by an amendment to the Articles of Association;
4. a photocopy of the receipt of submission of a copy of the Deed of Merger to the Minister, in the event the Merger is not accompanied by an amendment to the Articles of Association;
5. a photocopy of the establishment deed of the Bank that has been legalized by the Minister, in the event of Consolidation; and
6. proof of announcement as referred to in letter c.
   e. In the event that the announcement of the results of the Merger or Consolidation as referred to in letter c is conducted after the submission of the implementation report of the Merger or Consolidation as referred to in letter d, the proof of announcement must be submitted no later than 2 (two) working days after the announcement.

Article 22
(1) A Bank that does not meet the provisions as regulated in Article 8 paragraph (3), Article 10 paragraph (1), Article 10 paragraph (3), Article 11, Article 12, Article 21 letter a, Article 21 letter b, and/or Article 21 letter c is subject to administrative sanctions in the form of a written reprimand. (2) A Bank that is late in fulfilling the obligation to submit reports or proof of announcement as referred to in Article 10 paragraph (4), Article 21 letter d, and/or Article 21 letter e is subject to administrative sanctions in the form of a fine of IDR 1,000,000.00 (one million rupiah) per working day and a maximum of IDR 30,000,000.00 (thirty million rupiah) per type of report. (3) The imposition of administrative sanctions in the form of a fine as referred to in paragraph (2) does not eliminate the Bank's obligation to submit reports or proof of announcement. (4) In the event that the Board of Directors and/or the Bank has been subject to administrative sanctions as referred to in paragraph (1) and/or paragraph (2), the Board of Directors and/or the Bank may be subject to administrative sanctions in the form of:
a. prohibition on expanding business activities; b. suspension of certain business activities; and/or
c. prohibition as a principal party in accordance with OJK Regulations regarding the re-evaluation of principal parties of financial service institutions.

CHAPTER III
REQUIREMENTS AND PROCEDURES FOR TAKEOVER
First Section
General

Article 23
(1) The Takeover of a Bank may be conducted by a legal entity or an individual.
(2) The party conducting the Takeover of a Bank as referred to in paragraph (1) is required to:
a. maintain the continuity of the Bank's business; b. meet regulations related to Bank ownership; and
c. meet requirements as regulated in OJK Regulations regarding the assessment of competence and propriety for principal parties of financial service institutions.

Article 24
(1) The Takeover of a Bank is conducted through the takeover of shares that have been issued and/or will be issued by the Bank, which results in the transfer of Bank Control to the party taking over. (2) The takeover of Bank shares is deemed to result in the transfer of Bank Control as referred to in paragraph (1) if:
a. share ownership becomes the largest in the Bank; or b. share ownership does not exceed the largest shareholder but determines the management and/or policy of the Bank directly or indirectly. (3) In the event that there is a party purchasing Bank shares so that ownership becomes 25% (twenty-five percent) or more and does not cause Bank Control to transfer as referred to in paragraph (2), an assessment of competence and propriety is conducted for the said party.

Article 25
(1) The Board of Directors of the Bank to be taken over and the party to take over prepare a draft Takeover.
(2) The Bank submits information on the progress of the preparation of the draft Takeover as referred to in paragraph (1) to the OJK.
(3) The draft Takeover as referred to in paragraph (1) must obtain approval from:
a. the Board of Commissioners of the Bank to be taken over; and b. the board of commissioners of the party to take over in the event the party conducting the Takeover is a limited liability company legal entity or the competent organ in the event the party conducting the Takeover is a legal entity other than a limited liability company.

Article 26
The draft Takeover as referred to in Article 25 must at least contain information:
a. information regarding the parties:

1. information regarding the Bank to be taken over and the party to take over which at least contains the latest information regarding name, domicile, business activities, organizational structure, capital structure and shareholders, composition and names of members of the Board of Directors and Board of Commissioners; and
2. financial reports and financial performance information for the last 3 (three) fiscal years of the Bank to be taken over and the party to take over, which are audited by a public accountant;
   b. information regarding the Takeover plan:
3. estimated date of implementation of the Takeover;
4. reasons and explanation for conducting the Takeover of the Bank to be taken over and the party to take over;
5. method of valuation and conversion of shares of the Bank to be taken over against the exchange shares if the payment for the Takeover is conducted with shares;
6. number and value of shares of the Bank to be taken over;
7. funding readiness of the party to take over;
8. method for resolving the rights of shareholders who do not agree with the Takeover;
9. method for resolving the status, rights, and obligations of members of the Board of Directors, Board of Commissioners, Sharia Supervisory Board, and employees of the Bank to be taken over; and
10. proforma consolidated financial position report of the party to take over after the Takeover which is examined by a public accountant; and
    c. information regarding the Bank after the Takeover:
11. composition of shareholders after the Takeover is conducted;
12. change in main business activities of the Bank to be taken over, if any; and
13. draft amendment to the Articles of Association of the Bank to be taken over.

Article 27
(1) The Board of Directors of the Bank to be taken over and the party to take over submit documents for the preparation of the implementation of the Takeover to the OJK.
(2) The documents as referred to in paragraph (1) consist of:
a. documents of the draft Takeover as referred to in Article 25 that have obtained approval from the Board of Commissioners; b. concept of the Deed of Takeover; and
c. documents of administrative requirements for the purpose of assessing the competence and propriety of the prospective PSP as the party to take over the Bank.

Article 28
(1) The OJK conducts a review of the documents for the preparation of the implementation of the Takeover as referred to in Article 27, for a maximum of 20 (twenty) working days from the date the documents are received completely. (2) In conducting the review as referred to in paragraph (1), the OJK conducts:
a. research on the completeness and truthfulness of the documents as referred to in Article 27 paragraph (2); and b. assessment of competence and propriety for the prospective PSP as the party to take over the Bank, including research on the source of funds used to take over the Bank. (3) In conducting the review as referred to in paragraph (1), the OJK may request additional documents and/or information from the Bank to be taken over and/or the party taking over.

Article 29
(1) The Board of Directors of the Bank to be taken over and the party to take over are required to announce a summary of the draft Takeover to the public no later than:
a. 2 (two) working days after receiving notification from the OJK regarding the continuation of the implementation process of the Bank Takeover based on the results of the review conducted by the OJK as referred to in Article 28; and b. 30 (thirty) days before the convening of the General Meeting of Shareholders (GMS). (2) The announcement as referred to in paragraph (1) must at least contain:
a. a summary of the draft Takeover as referred to in Article 26; and b. information that the draft Takeover has not yet obtained GMS approval.
(3) The announcement as referred to in paragraph (1) must be conducted at least through:
a. 1 (one) daily newspaper in the Indonesian language with national circulation; and b. The Bank's Website.
(4) Proof of announcement as referred to in paragraph (3) must be submitted to the OJK no later than 2 (two) working days after the said announcement.

Article 30
The Board of Directors of the Bank to be taken over and the party to take over are required to announce in writing to employees simultaneously with the announcement of the summary of the draft Takeover as referred to in Article 29.

Article 31
(1) Creditors may submit objections to the Bank regarding the implementation of the Takeover within a maximum period of 14 (fourteen) days after the announcement of the summary of the draft Takeover as referred to in Article 29. (2) If within the period as referred to in paragraph (1) the creditor does not submit an objection, the creditor is deemed to agree with the Takeover. (3) In the event that the creditor's objection as referred to in paragraph (1) until the date the GMS is held cannot be resolved by the Board of Directors, the objection must be submitted in the GMS to obtain resolution. (4) Resolution by the Board of Directors or by the GMS as referred to in paragraph (3) may be in the form of resolving the objection or establishing a scheme for resolving the objection agreed upon by the Bank and the creditor, which is contained in a deed made by a notary in the Indonesian language. (5) Until the resolution as referred to in paragraph (4) is reached, the Takeover cannot be implemented.

Article 32
The Bank to be taken over and the party to take over request GMS approval in the event the party conducting the Takeover is a legal entity in the form of a limited liability company, or approval from the competent organ for the party to take over if it is a legal entity other than a limited liability company regarding:
a. the Takeover to be conducted against the Bank; b. the draft Takeover; and
c. the concept of the Deed of Takeover.

Article 33
(1) Shareholders who do not agree with the GMS decision as referred to in Article 32 may only use their right to request their shares be purchased by the Bank at a fair price. (2) The use of the right as referred to in paragraph (1) does not stop the implementation process of the Takeover.

Article 34
(1) The Board of Directors of the Bank to be taken over and the party to take over jointly submit an application for a Takeover License to the OJK.
(2) The application to obtain a Takeover License as referred to in paragraph (1) is submitted by the Bank to be taken over to the OJK no later than 3 (three) working days after the GMS decision approving the Takeover. (3) The application for a Takeover License to the OJK as referred to in paragraph (1) is attached with:
a. the minutes of the GMS made with a notarial deed containing approval of the Takeover; b. the draft Takeover that has been approved by the GMS;
c. the concept of the Deed of Takeover as referred to in Article 32 that has been approved by the GMS;
d. the concept of amendment to the Articles of Association of the Bank related to the Takeover, in the event there is an amendment to the Articles of Association; and e. financial reports and latest financial performance information of the Bank to be taken over and the party to take over in the event the application for a Takeover License is submitted within a period of 6 (six) months or more since the announcement of the summary of the draft Takeover to the public as referred to in Article 29. (4) If necessary, the OJK may request additional documents and/or information from the Bank to be taken over and the party to take over.

Article 35
(1) The OJK provides approval or rejection of the application for a Takeover License as referred to in Article 34.
(2) The approval or rejection as referred to in paragraph (1) is provided within a period of 14 (fourteen) working days from the date the documents as referred to in Article 34 paragraph (3) and paragraph (4) are received completely. (3) In providing approval or rejection as referred to in paragraph (2), the OJK conducts:
a. research on the completeness and truthfulness of the documents as referred to in Article 34 paragraph (3) and paragraph (4); b. assessment of competence and propriety for the party to take over; and
c. analysis of the latest financial performance of the Bank to be taken over and the party to take over.
(4) In the event the OJK provides approval for the application for a Takeover License, the OJK establishes the results of the assessment of competence and propriety for the party to take over. (5) In the event the OJK rejects the application for a Takeover License, the rejection is accompanied by written reasons.

Article 36
(1) In the event there is an amendment to the Articles of Association related to the Takeover, the amendment to the Articles of Association must be stated in a deed made by a notary in the Indonesian language. (2) The amendment to the Articles of Association of the Bank to be taken over is submitted to the Minister no later than 30 (thirty) days calculated from the date of the notarial deed containing the amendment to the Articles of Association, to obtain approval or as a notification to the Minister. (3) The submission to the Minister as referred to in paragraph (2) is accompanied by a copy of the Deed of Takeover.

Article 37
The Takeover License is valid:
a. since:

1. the date of the Minister's approval or a later date determined in the Minister's approval; or
2. the date the notification of amendment to the Articles of Association is received by the Minister, or a later date determined in the Deed of Takeover,
   if the Takeover is accompanied by an amendment to the Articles of Association; or b. since the date the notification is received by the Minister for recording in the company register, if the Takeover is not accompanied by an amendment to the Articles of Association.

Article 38
A Bank that has obtained a Takeover License is required to:
a. announce the results of the Takeover within a maximum period of 30 (thirty) days calculated from the date the Takeover becomes effective through:

1. 1 (one) daily newspaper in the Indonesian language with national circulation; and
2. The Bank's Website;
   b. submit a report on the implementation of the Takeover to the OJK no later than 5 (five) working days after the date the Takeover becomes effective, attached with:
3. a photocopy of the Deed of Takeover;
4. a photocopy of the deed amending the Articles of Association of the Bank that has been approved and/or notified to the Minister, in the event the Takeover is accompanied by an amendment to the Articles of Association;
5. a photocopy of the receipt of submission of a copy of the Deed of Takeover to the Minister, in the event the Takeover is not accompanied by an amendment to the Articles of Association; and
6. proof of announcement as referred to in letter a;
   c. in the event that the announcement of the results of the Takeover as referred to in letter a is conducted after the submission of the implementation report of the Takeover as referred to in letter b, the proof of announcement must be submitted no later than 2 (two) working days after the announcement.

Second Section
Purchase of Bank Shares

Article 39
(1) A Bank may only list its shares on the stock exchange for a maximum of 99% (ninety-nine percent) of the total shares of the Bank.
(2) At least 1% (one percent) of the Bank's shares that are not listed on the stock exchange must remain owned by Indonesian citizens and/or Indonesian legal entities.

Article 40
(1) The purchase of Bank shares that results in the transfer of Control follows the Takeover procedures.
(2) The Bank is required to report to the OJK no later than 10 (ten) working days since the date of receipt of notification from the Minister regarding the amendment to the Articles of Association, in the event the purchase of Bank shares does not result in the transfer of Control and is intended to be recorded in the Bank's ownership. (3) The reporting as referred to in paragraph (2) must at least contain:
a. name and address of the share owner; b. date of recording of ownership in the Bank; and
c. number of shares, classification of shares if any, including the number for each classification, rights attached to each share, nominal value, and percentage of ownership of the purchased shares.
(4) The submission of the report is attached with a photocopy of the deed amending the Articles of Association containing the recording of the purchase of shares in the Bank's ownership as referred to in paragraph (2).

Article 41
(1) Parties that own Bank shares through the stock exchange and meet the criteria as PSP are subject to an assessment of competence and propriety.
(2) Parties prohibited from owning Bank shares according to applicable regulations who are proven to own Bank shares, including ownership through the stock exchange, are required to release their ownership.

Article 42
(1) The Board of Directors and/or the Bank that do not meet the provisions as regulated in Article 23 paragraph (2), Article 25 paragraph (3), Article 29 paragraph (1), Article 29 paragraph (3), Article 30, Article 36 paragraph (1), Article 38 letter a, and/or Article 41 paragraph (2) are subject to administrative sanctions in the form of a written reprimand. (2) A Bank that is late in fulfilling the obligation to submit reports or proof of announcement as referred to in Article 29 paragraph (4), Article 38 letter b, Article 38 letter c, and/or Article 40 paragraph (2) is subject to administrative sanctions in the form of a fine of IDR 1,000,000.00 (one million rupiah) per working day and a maximum of IDR 30,000,000.00 (thirty million rupiah) per type of report. (3) The imposition of administrative sanctions in the form of a fine as referred to in paragraph (2) does not eliminate the Bank's obligation to submit reports or proof of announcement. (4) In the event that the Board of Directors and/or the Bank has been subject to administrative sanctions as referred to in paragraph (1) and/or paragraph (2), the Board of Directors and/or the Bank may be subject to administrative sanctions in the form of:
a. prohibition on expanding business activities; b. suspension of certain business activities; and/or
c. prohibition as a principal party in accordance with OJK Regulations regarding the re-evaluation of principal parties of financial service institutions.

CHAPTER IV
REQUIREMENTS AND PROCEDURES FOR INTEGRATION

Article 43
(1) Integration is conducted through the transfer of assets and/or liabilities of a Sharia Business Unit (KCBLN) of good legal quality to the Bank that will receive the Integration. (2) The KCBLN must obtain approval for Integration from the KCBLN headquarters, evidenced by a letter of approval from the competent organ at the KCBLN headquarters. (3) The letter of approval as referred to in paragraph (2) must contain approval for the revocation of the business license of the KCBLN as a consequence of the Integration.

Article 44
(1) The Board of Directors of the Bank and the KCBLN that will conduct the Integration jointly prepare a draft Integration.
(2) The Bank submits information on the progress of the preparation of the draft Integration as referred to in paragraph (1) to the OJK.
(3) The draft Integration as referred to in paragraph (1) must obtain approval from the Board of Commissioners of the Bank and the competent organ at the KCBLN headquarters.

Article 45
The draft Integration as referred to in Article 44 must at least contain information:
a. information regarding the Bank and KCBLN that will conduct the Integration:

1. name, domicile, office network, business activities/products/activities, organizational structure, composition and names of members of the Board of Directors, Board of Commissioners of the Bank and KCBLN, and the Sharia Supervisory Board of the Bank;

2. capital structure and shareholders of the Bank and ownership structure of the KCBLN;

3. report on the condition, development, and results achieved by the Bank and KCBLN that will conduct the Integration;

4. financial reports and financial performance information for the last 3 (three) fiscal years audited by a public accountant from the Bank and KCBLN that will conduct the Integration; and

5. confirmation from the Bank that will receive the Integration that it will accept the transfer of all rights and obligations of the KCBLN regarding the Integration in accordance with the minutes of the transfer of rights and obligations between the KCBLN and the Bank that will receive the Integration;
   b. information regarding the Integration plan:

6. schedule of the plan and effective date of the Integration and schedule of the plan and estimated date of revocation of the business license of the KCBLN;

7. reasons and explanation for conducting the Integration;

8. information for the current fiscal year, at least containing:
   a) interim period financial reports and financial performance information; b) change in main business activities of the Bank and KCBLN, if any; and c) details of problems arising during the current fiscal year that affect the activities of the Bank and KCBLN, if any;

9. policy for fulfilling other regulations related to the Integration;

10. method used regarding the legal transfer of assets and/or liabilities of good quality from the KCBLN to the Bank that will receive the Integration, and recognition regarding financial aspects of the Integration transaction that are in accordance with Indonesian financial accounting standards;

11. method for resolving the status, rights, and obligations of members of the Board of Directors, Board of Commissioners, Sharia Supervisory Board, and employees of the Bank and KCBLN;

12. conflict of interest between the Bank and KCBLN and members of the Board of Directors, Board of Commissioners, or Sharia Supervisory Board, if any;

13. method for resolving the rights and obligations of the Bank and KCBLN towards third parties;

14. action plan for resolving the rights and obligations of the KCBLN conducting conventional business activities no later than 1 (one) year since the Integration license becomes effective, in the event the Integration is conducted between a KCBLN and a Sharia Commercial Bank (BUS);

15. method for resolving the rights of shareholders of the Bank who do not agree with the Integration;

16. results of the assessment by experts regarding certain aspects of the Integration, if necessary;

17. opinion of legal consultants regarding the legal aspects of the Integration; and

18. summary of the independent appraiser's report regarding the opinion on the fairness of the Integration; and
    c. information regarding the Bank resulting from the Integration:

19. name, domicile, status of office network, business activities/products/activities, organizational structure, composition of members of the Board of Directors, Board of Commissioners, and Sharia Supervisory Board, as well as information technology and human resources;

20. plan for changing name and logo, if any;

21. capital structure and shareholders;

22. proforma financial data examined by a public accountant;

23. projection of the Bank's health level for 2 (two) assessment periods with a minimum Composite Rating 3 (CR-3), and a remediation plan if the projected health level during the 2 (two) assessment periods is lower than Composite Rating 3 (CR-3);

24. explanation regarding the benefits and risks that may arise from Integration along with risk mitigation;

25. salaries, honoraria, and other allowances for members of the Board of Directors, Board of Commissioners, and Sharia Supervisory Board;

26. draft amendment to the Articles of Association in the event of changes to the Articles of Association; and

27. business plan.

Article 46
(1) The Board of Directors of the Bank and KCBLN intending to perform Integration shall submit documents preparing for the implementation of Integration to OJK.
(2) Documents as referred to in paragraph (1) consist of:
a. letter of approval from the headquarters of the KCBLN that will perform Integration, including approval for the revocation of the business license of the KCBLN as a result of Integration, as referred to in Article 43; b. draft Integration that has been approved by the Board of Commissioners of the Bank and the competent organ at the headquarters of the KCBLN as referred to in Article 44 paragraph (3);
c. concept of the Integration deed; and
d. administrative requirement documents:

1. for the purpose of assessing competence and propriety for:
   a) prospective members of the Board of Directors and prospective members of the Board of Commissioners of the Bank resulting from Integration contained in the draft Integration as referred to in Article 45 letter c number 1; and b) prospective PSPs of the Bank resulting from Integration in the event Integration is accompanied by replacement or change of PSPs; and
2. for the purpose of interviews for prospective members of the Sharia Supervisory Board as referred to in Article 45 letter c number 1 in the event the Bank intended to perform Integration is a Sharia Commercial Bank (BUS).

Article 47
(1) OJK shall conduct a review of the documents preparing for the implementation of Integration as referred to in Article 46 for a maximum of 20 (twenty) working days since the documents are received completely. (2) In conducting the review as referred to in paragraph (1), OJK conducts research on the completeness and truthfulness of the documents. (3) In conducting the review as referred to in paragraph (1), OJK may request additional documents and/or information from the Bank and/or KCBLN.

Article 48
(1) The Board of Directors of the Bank and KCBLN intending to perform Integration must announce a summary of the draft Integration to the public no later than:
a. 2 (two) working days after receiving notification from OJK regarding the continuation of the implementation process of Integration based on the results of the review conducted by OJK as referred to in Article 47; and b. 30 (thirty) days before the convening of the General Meeting of Shareholders (GMS) of the Bank. (2) The announcement of the summary of the draft Integration as referred to in paragraph (1) must contain at least:
a. a summary of the draft Integration as referred to in Article 45; and b. information that the draft Integration has not yet obtained approval from the GMS of the Bank.
(3) The announcement as referred to in paragraph (1) must be carried out through at least:
a. 1 (one) daily newspaper in Indonesian language with national circulation; and b. Website of the Bank and KCBLN.
(4) Proof of announcement as referred to in paragraph (3) must be submitted to OJK no later than 2 (two) working days after the announcement.

Article 49
The Board of Directors of the Bank and KCBLN intending to perform Integration must announce the Integration plan in writing to employees of the Bank and KCBLN performing Integration, simultaneously with the announcement of the summary of the draft Integration as referred to in Article 48.

Article 50
(1) Creditors may file objections to the Bank and/or KCBLN regarding the implementation of Integration within a period of no later than 14 (fourteen) days after the announcement of the summary of the draft Integration as referred to in Article 48. (2) If within the period as referred to in paragraph (1) creditors do not file objections, creditors are deemed to have approved the Integration. (3) In the event that objections from creditors of the Bank intended to perform Integration as referred to in paragraph (1) cannot be resolved by the Board of Directors until the date the GMS is held, the objections must be submitted in the GMS for resolution. (4) Objections from creditors of the KCBLN intended to perform Integration shall be resolved by the Board of Directors of the KCBLN no later than until the implementation of the GMS of the Bank that will receive the Integration. (5) Resolution by:
a. the Board of Directors of the Bank or by the GMS of the Bank that will receive the Integration as referred to in paragraph (3); and b. the KCBLN as referred to in paragraph (4), may consist of resolving the objections or establishing a scheme for resolving objections agreed upon by the Bank and/or KCBLN with creditors, and contained in a deed made by a notary in Indonesian. (6) During the time that resolution as referred to in paragraph (5) has not been achieved, Integration cannot be implemented. (7) KCBLN must resolve creditor objections based on the creditor objection resolution scheme until the revocation of the business license of the KCBLN. (8) In the event that resolution of creditor objections based on the creditor objection resolution scheme as referred to in paragraph (7) cannot be achieved:
a. resolution of creditor objections shifts to become the responsibility of the headquarters of the KCBLN whose business license is revoked, supported by a document stating the responsibility of the headquarters of the KCBLN; or b. resolution of creditor objections shifts to become the responsibility of the Bank that will receive the Integration based on a deed made by a notary in Indonesian.

Article 51
The Bank that will receive Integration requests GMS approval regarding:
a. Integration to be performed by the Bank and KCBLN; b. draft Integration;
c. concept of the Integration deed; and
d. draft amendment to the Articles of Association of the Bank that will receive Integration, in the event there are changes to the Articles of Association.

Article 52
(1) Shareholders of the Bank receiving Integration who disagree with the GMS decision as referred to in Article 51 may only use their right to request their shares be purchased at a fair price by the Bank. (2) The exercise of the right as referred to in paragraph (1) does not stop the process of implementing Integration.

Article 53
(1) The Board of Directors of the Bank and KCBLN intending to perform Integration jointly submit an application for Integration permission to OJK.
(2) The application to obtain Integration permission as referred to in paragraph (1) is submitted to OJK no later than 3 (three) working days after the approval decision of Integration from the GMS of the Bank that will receive the Integration. (3) The application for Integration permission submitted to OJK as referred to in paragraph (1) is attached with:
a. minutes of the GMS of the Bank that will receive Integration made with a notarial deed containing approval for Integration; b. draft Integration that has been approved by the GMS of the Bank that will receive Integration;
c. concept of the Integration deed that has been approved by the GMS;
d. draft amendment to the Articles of Association of the Bank that will receive Integration that has been approved by the GMS, in the event there are changes to the Articles of Association; e. draft minutes of the transfer of all rights and obligations from the KCBLN to the Bank that will receive Integration; and f. financial statements and latest financial performance information of the Bank and KCBLN that will perform Integration in the event the application for Integration permission is submitted within a period of 6 (six) months or more since the announcement of the summary of the draft Integration to the public as referred to in Article 48. (4) If necessary, OJK may request additional documents and/or information from the Bank that will receive Integration.

Article 54
(1) OJK provides approval or rejection of the application for Integration permission as referred to in Article 53.
(2) Approval or rejection as referred to in paragraph (1) is provided within a period of 14 (fourteen) working days since the documents as referred to in Article 53 paragraph (3) and paragraph (4) are received completely. (3) In providing approval or rejection as referred to in paragraph (2), OJK conducts:
a. research on the completeness and truthfulness of documents as referred to in Article 53 paragraph (3) and paragraph (4); b. assessment of competence and propriety towards:

1. prospective members of the Board of Directors and prospective members of the Board of Commissioners of the Bank resulting from Integration; and
2. prospective PSPs of the Bank resulting from Integration in the event Integration is accompanied by replacement or change of PSPs;
   c. interviews with prospective members of the Sharia Supervisory Board, in the event the Bank resulting from Integration is a Sharia Commercial Bank (BUS); and
   d. analysis of the latest financial performance of the Bank and KCBLN that will perform Integration.
   (4) In the event OJK provides approval for the application for Integration permission, OJK establishes:
   a. results of the assessment of competence and propriety towards prospective members of the Board of Directors and prospective members of the Board of Commissioners of the Bank resulting from Integration; b. results of the assessment of competence and propriety towards prospective PSPs of the Bank resulting from Integration in the event Integration is accompanied by replacement or change of PSPs; and
   c. results of interview assessments towards prospective members of the Sharia Supervisory Board, in the event the Bank resulting from Integration is a Sharia Commercial Bank (BUS).
   (5) In the event OJK rejects the application for Integration permission, the rejection is accompanied by written reasons.

Article 55
(1) The Bank and KCBLN that will perform Integration must issue an Integration deed made by a notary in Indonesian, no later than 2 (two) working days since the date of OJK approval. (2) The Bank submits amendments to the Articles of Association to obtain approval from the Minister or as notification to the Minister, no later than 30 (thirty) days since the issuance of the Integration deed.

Article 56
Integration permission is valid since the date of approval from the Minister or the date of notification received by the Minister regarding changes to the Articles of Association, or the date of notification received by the Minister to be recorded in the company register in the event Integration is not accompanied by changes to the Articles of Association.

Article 57
Since the Integration permission becomes valid as referred to in Article 56:
a. KCBLN:

1. must carry out the transfer of all assets and/or liabilities of good quality to the Bank resulting from Integration, which is contained in the minutes of transfer of assets and/or liabilities from the KCBLN to the Bank resulting from Integration made by a notary in Indonesian;
2. is prohibited from carrying out banking business activities, except for the settlement of rights and obligations that are not transferred to the Bank resulting from Integration including the settlement of creditor objections; and
3. must compile closing financial position reports of the KCBLN.
   b. The Board of Directors of the Bank resulting from Integration must:
4. compile closing financial position reports of the Bank that performs Integration;
5. compile opening financial position reports of the Bank resulting from Integration;
6. announce the effective date of Integration within a period of no later than 5 (five) working days counted from the date Integration becomes valid, through:
   a) 1 (one) daily newspaper in Indonesian language with national circulation; and b) Website of the Bank;
7. submit reports on the implementation of Integration to OJK no later than 5 (five) working days after the effective date of Integration, attached with:
   a) photocopy of the amendment to the Articles of Association of the Bank that has been approved or notified to the Minister, in the event Integration is accompanied by changes to the Articles of Association; b) photocopy of the receipt of submission of copies of the Integration deed to the Minister, in the event Integration is not accompanied by changes to the Articles of Association; c) photocopy of the Integration deed; and d) proof of announcement as referred to in letter b number 3.

Article 58
(1) Settlement of the revocation of the business license of the KCBLN performing Integration refers to regulations concerning laws and regulations regarding revocation of business licenses, dissolution, and liquidation of commercial banks. (2) Revocation of the business license of the KCBLN must be carried out no later than within a period of 2 (two) years since the date the Integration permission becomes valid. (3) Since the Integration permission becomes valid until the revocation of the business license of the KCBLN, rights and obligations that are not transferred to the Bank resulting from Integration must be settled by the KCBLN. (4) In the event that settlement by the KCBLN as referred to in paragraph (3) cannot be fulfilled:
a. settlement of rights and obligations shifts to become the responsibility of the headquarters of the KCBLN whose business license is revoked, supported by a document stating the responsibility of the headquarters of the KCBLN; or b. settlement of rights and obligations shifts to become the responsibility of the Bank resulting from Integration based on a deed made by a notary in Indonesian. (5) Documents or deeds as referred to in paragraph (4) and in Article 50 paragraph (8) must be submitted by the competent organ at the headquarters of the KCBLN or the Board of Directors of the Bank resulting from Integration to OJK no later than until the revocation of the business license of the KCBLN as referred to in paragraph (2).

Article 59
The Bank resulting from Integration may use part or all of the products and activities, as well as facilities and infrastructure of the KCBLN as long as they meet the criteria and requirements established for Banks.

Article 60
(1) The Board of Directors, Bank, Bank resulting from Integration and/or KCBLN that do not fulfill provisions as regulated in Article 43 paragraph (2), Article 43 paragraph (3), Article 44 paragraph (3), Article 48 paragraph (1), Article 48 paragraph (3), Article 49, Article 55 paragraph (1), Article 57, Article 58 paragraph (3), and/or Article 58 paragraph (5), are subject to administrative sanctions in the form of written reprimands. (2) The Board of Directors, Bank, Bank resulting from Integration and/or KCBLN that are late in fulfilling the obligation to submit reports or proof of announcement as referred to in Article 48 paragraph (4) and/or Article 57 letter b number 4 are subject to administrative sanctions in the form of fines amounting to IDR 1,000,000.00 (one million rupiah) per working day and a maximum of IDR 30,000,000.00 (thirty million rupiah) per type of report. (3) Imposition of administrative sanctions in the form of fines as referred to in paragraph (2) does not eliminate the Bank's obligation to submit reports or proof of announcement. (4) In the event the Board of Directors, Bank, and/or KCBLN have been subjected to administrative sanctions as referred to in paragraph (1) and/or paragraph (2), the Board of Directors, Bank, and/or KCBLN may be subjected to administrative sanctions in the form of:
a. prohibition on expanding business activities; b. suspension of certain business activities; and/or
c. prohibition on being a principal party in accordance with OJK Regulations regarding reassessment for principal parties of financial service institutions.

CHAPTER V
REQUIREMENTS AND PROCEDURES FOR CONVERSION

Article 61
(1) The licensing process for Conversion is carried out in 2 (two) series of licensing activities:
a. Conversion permission; and b. permission for establishment and business activities of the Bank as the Bank resulting from Conversion.
(2) Granting permission for the establishment and business activities of the Bank as the Bank resulting from Conversion as referred to in paragraph (1) letter b is carried out in 2 (two) stages:
a. principle approval, and b. business license, as regulated in laws and regulations concerning commercial banks and Sharia commercial banks.
(3) The Bank as the Bank resulting from Conversion as referred to in paragraph (1) letter b must:
a. be in the form of a limited liability company; and b. meet paid-in capital of at least equal to the total business funds as calculated in the capital components of the KCBLN based on the latest financial statements of the KCBLN before submitting the application for Conversion permission.

Article 62
(1) The application for Conversion permission is submitted by the KCBLN to OJK simultaneously with the application to obtain principle approval for the establishment of the Bank as the Bank resulting from Conversion, accompanied by:
a. letter of approval from the headquarters of the KCBLN, proven by a letter of approval from the competent organ at the headquarters of the KCBLN regarding:

1. approval to perform Conversion;
2. approval for the establishment and business activities of the Bank as the Bank resulting from Conversion; and
3. approval to apply for revocation of the business license of the KCBLN as a result of Conversion; and
   b. fulfillment of requirements to obtain principle approval for the establishment and business activities of the Bank as the Bank resulting from Conversion.
   (2) Fulfillment of requirements as referred to in paragraph (1) letter b refers to laws and regulations concerning commercial banks or Sharia commercial banks, unless otherwise specifically regulated in this OJK Regulation. (3) Requirements as referred to in paragraph (2), are completed with documents:
   a. explanation of the reason for performing Conversion; b. financial statements and financial performance information for the last 3 (three) fiscal years audited by a public accountant from the KCBLN that will perform Conversion;
   c. interim period financial statements and financial performance information of the KCBLN;
   d. schedule of the planned Conversion and effective date, and schedule of the planned and estimated duration for revocation of the business license of the KCBLN; e. name, domicile, status of office network, business activities/products/activities, information technology, and human resources, of the Bank as the Bank resulting from Conversion; f. plan for changing the name and logo of the Bank resulting from Conversion; g. method used regarding the legal transfer of assets and/or liabilities from the KCBLN to the Bank as the Bank resulting from Conversion, as well as recognition regarding financial aspects of Conversion that comply with Indonesian financial accounting standards; h. projection of the health level of the Bank as the Bank resulting from Conversion during 2 (two) assessment periods with a minimum Composite Rating 3 (CR-3), and remediation plan if the projected health level of the Bank resulting from Conversion during 2 (two) assessment periods is lower than Composite Rating 3 (CR-3);
   i. method for settling the status, rights, and obligations of members of the Board of Directors, and employees of the KCBLN that will perform Conversion;
   j. procedure for settling the rights and obligations of the KCBLN that will perform Conversion towards third parties; k. salaries, honoraria, and other allowances for members of the Board of Directors, Board of Commissioners, and Sharia Supervisory Board of the Bank as the Bank resulting from Conversion;
   l. action plan for settling rights and obligations from conventional business activities no later than 1 (one) year since the Conversion permission becomes valid, in the event the Bank resulting from Conversion is a Sharia Commercial Bank (BUS); and
   m. business plan of the Bank resulting from Conversion.
   (4) If necessary, OJK may request additional documents and/or information from the KCBLN that will perform Conversion.

Article 63
Approval or rejection by OJK regarding the application for principle approval as referred to in Article 62 paragraph (1) refers to the mechanism regulated in laws and regulations concerning commercial banks or Sharia commercial banks.

Article 64
The Board of Directors of the KCBLN that will perform Conversion must announce the Conversion plan in writing to employees no later than 10 (ten) days since the submission of the application for Conversion permission as referred to in Article 62.

Article 65
(1) The application to obtain a business license for the Bank as the Bank resulting from Conversion is submitted by the KCBLN to OJK after obtaining principle approval for the establishment of the Bank as the Bank resulting from Conversion. (2) Fulfillment of requirements in submitting the application to obtain a business license for the Bank as the Bank resulting from Conversion as referred to in paragraph (1) refers to requirements to obtain a business license as regulated in laws and regulations concerning commercial banks or Sharia commercial banks, unless otherwise specifically regulated in this OJK Regulation. (3) Requirements as referred to in paragraph (2), are completed with the concept of minutes of the transfer of rights and obligations from the KCBLN to the Bank as the Bank resulting from Conversion.

Article 66
(1) The implementation plan of Conversion by the KCBLN must be announced to the public no later than 2 (two) working days after obtaining principle approval for the establishment of the Bank as the Bank resulting from Conversion. (2) The announcement as referred to in paragraph (1) must be carried out through at least:
a. 1 (one) daily newspaper in Indonesian language with national circulation; and b. Website of the KCBLN.
(3) Proof of announcement as referred to in paragraph (2) must be submitted to OJK no later than 2 (two) working days after the announcement.

Article 67
(1) Creditors may file objections to the KCBLN regarding the implementation of Conversion within a period of no later than 14 (fourteen) days after the announcement of the implementation of Conversion as referred to in Article 66. (2) If within the period as referred to in paragraph (1) creditors do not file objections, creditors are deemed to have approved the Conversion. (3) Objections from creditors of the KCBLN that will perform Conversion shall be resolved by the Board of Directors of the KCBLN no later than until the business license of the Bank as the Bank resulting from Conversion is obtained from OJK. (4) Resolution by the Board of Directors of the KCBLN as referred to in paragraph (3) may consist of resolving the objections or establishing a scheme for resolving objections agreed upon by the KCBLN with creditors, which is contained in a deed made by a notary in Indonesian. (5) In the event the KCBLN cannot resolve creditor objections until the business license of the Bank as the Bank resulting from Conversion is obtained, creditor objections must be resolved by the Bank resulting from Conversion. (6) Resolution of creditor objections of the KCBLN through the scheme for resolving objections agreed upon by the KCBLN with creditors as referred to in paragraph (4) remains the responsibility of the Bank resulting from Conversion.

Article 68
Approval or rejection by OJK regarding the application for business license refers to the mechanism as regulated in laws and regulations concerning commercial banks or Sharia commercial banks, unless otherwise specifically regulated in this OJK Regulation.

Article 69
(1) The application for Conversion permission is declared approved in the event OJK provides approval for the application for business license of the Bank as the Bank resulting from Conversion. (2) The Bank resulting from Conversion must carry out banking business activities no later than 60 (sixty) working days counted from the date the business license of the Bank resulting from Conversion is obtained. (3) The deadline as referred to in paragraph (2) may be extended in the event caused by unavoidable circumstances (force majeure) or other considerations acceptable to OJK. (4) Implementation of banking business activities by the Bank resulting from Conversion as referred to in paragraph (2) is preceded by the transfer of all rights and obligations of the KCBLN to the Bank resulting from Conversion. (5) Transfer of all rights and obligations of the KCBLN as referred to in paragraph (4) is contained in minutes of transfer of rights and obligations from the KCBLN to the Bank as the Bank resulting from Conversion made by a notary in Indonesian. (6) Implementation of business activities as referred to in paragraph (2) must be reported by the Board of Directors of the Bank resulting from Conversion to OJK no later than 10 (ten) working days after the date of operational implementation.

Article 70
(1) The Bank resulting from Conversion must fulfill applicable legal provisions for Banks.
(2) The Bank as the Bank resulting from Conversion may use part or all of the products and activities of the KCBLN, as well as facilities and infrastructure of the KCBLN as long as they meet the criteria and requirements established for Banks.

Article 71
(1) Implementation of business activities of the Bank as the Bank resulting from Conversion must be announced to the public simultaneously with reporting to OJK as referred to in Article 69 paragraph (6). (2) The announcement as referred to in paragraph (1) must be carried out through at least:
a. 1 (one) daily newspaper in Indonesian language with national circulation; and b. Website of the KCBLN.
(3) Proof of announcement must be submitted to OJK no later than 2 (two) working days after the announcement as referred to in paragraph (2).

Article 72
(1) Settlement of the revocation of the business license of the KCBLN performing Conversion refers to the mechanism regulated in laws and regulations regarding revocation of business licenses, dissolution, and liquidation of commercial banks. (2) Settlement of revocation of the business license of the KCBLN as referred to in paragraph (1) must be carried out no later than within

the time limit of 2 (two) years from the date of the business license of the Bank as the Bank resulting from the Conversion.
(3) At the time the Bank as the Bank resulting from the Conversion has effectively commenced banking business activities:
a. KCBLN is prohibited from conducting banking business activities, except for the settlement of rights and obligations that were not transferred to the Bank resulting from the Conversion, including the settlement of creditor objections; and b. in the event that there are still rights and obligations and creditor objections as referred to in letter a that have not been settled by KCBLN, management and settlement are carried out by KCBLN until the business license of KCBLN is revoked. (4) The revocation of the business license of KCBLN is carried out if the management and settlement of rights and obligations by KCBLN, including the settlement of creditor objections as referred to in paragraph (3) letter b:
a. has been settled in its entirety; or b. the management and settlement period has met the time limit of 2 (two) years.
(5) In the event that until the revocation of the business license of KCBLN, the settlement of rights and obligations, including the settlement of creditor objections, cannot be fulfilled by KCBLN, further settlement mechanisms are carried out by the Bank resulting from the Conversion.

Article 73
(1) The Board of Directors, KCBLN and/or the Bank resulting from the Conversion that do not meet the provisions as regulated in Article 61 paragraph (3), Article 64, Article 66 paragraph (1), Article 66 paragraph (2), Article 69 paragraph (2), Article 70 paragraph (1), Article 71 paragraph (1), Article 71 paragraph (2), and/or Article 72 paragraph (3) are subject to administrative sanctions in the form of a written reprimand.

(2) KCBLN or the Bank resulting from the Conversion that are late in fulfilling the obligation to submit reports or proof of announcement as referred to in Article 66 paragraph (3), Article 69 paragraph (6), and/or Article 71 paragraph (3) are subject to administrative sanctions in the form of a fine of Rp1,000,000.00 (one million rupiah) per working day and at most Rp30,000,000.00 (thirty million rupiah) per type of report. (3) The imposition of administrative sanctions in the form of a fine as referred to in paragraph (2) does not eliminate the obligation of KCBLN or the Bank resulting from the Conversion to submit reports or proof of announcement. (4) In the event that the Board of Directors, KCBLN and/or the Bank resulting from the Conversion have been subject to administrative sanctions as referred to in paragraph (1) and/or paragraph (2), the Board of Directors, KCBLN and/or the Bank resulting from the Conversion may be subject to administrative sanctions in the form of:
a. prohibition on expanding business activities; b. suspension of certain business activities; and/or
c. prohibition on acting as a principal party in accordance with OJK Regulations regarding the re-evaluation of principal parties of financial service institutions.

CHAPTER VI
OTHER PROVISIONS

Article 74
(1) KCBLN submits information regarding the merger or consolidation of the KCBLN headquarters to OJK.
(2) The information submitted to OJK as referred to in paragraph (1) relates to:
a. the plan for the merger or consolidation of the KCBLN headquarters; b. the stages of the merger or consolidation of the KCBLN headquarters;
c. the impact of the merger or consolidation of the KCBLN headquarters on the existence of KCBLN in Indonesia;

d. the effective date of the merger or consolidation of the KCBLN headquarters; and e. other relevant information, if any.

Article 75
The implementation of Merger, Consolidation, Takeover, Integration, or Conversion carried out based on OJK supervisory actions as referred to in Article 2 paragraph (1) letter b is carried out in accordance with the provisions as regulated in this OJK Regulation.

Article 76
OJK may establish policies based on certain considerations regarding the implementation of Merger, Consolidation, Takeover, Integration, or Conversion other than those regulated in this OJK Regulation.

Article 77
The implementation of Merger, Consolidation, Takeover, or Integration against Banks with the status of a public company also refers to OJK regulations regarding public companies.

Article 78
(1) Fulfillment of other provisions for the Bank resulting from Merger, Consolidation, Integration, or Conversion related to the implementation of Merger, Consolidation, Integration, or Conversion refers to legislation. (2) The Bank resulting from Merger, Consolidation, Integration, or Conversion may submit a request for extension of the time limit for fulfilling the provisions as referred to in paragraph (1) if, based on the Bank's assessment, the fulfillment of the aforementioned provisions exceeds the time limit as established. (3) The request as referred to in paragraph (2) is submitted by the Bank resulting from Merger, Consolidation, Integration, or Conversion to OJK, accompanied by an action plan containing the steps taken for settlement and the target time for settlement. (4) The request and action plan submitted to OJK as referred to in paragraph (3) become OJK's consideration in granting approval.

CHAPTER VII
SUBMISSION

Article 79
(1) Requests to obtain licenses and/or submission of documents and reports on the implementation of Merger, Consolidation, Takeover, Integration, or Conversion, are submitted by Banks and/or KCBLN online through the OJK licensing system and reporting system. (2) The procedure for online submission by Banks and KCBLN as referred to in paragraph (1) refers to OJK Regulations regarding the OJK licensing system and reporting system. (3) In the event that the OJK licensing and reporting system as referred to in paragraph (1) is not yet available, Banks and KCBLN submit requests to obtain licenses and/or submission of documents and reports on the implementation of Merger, Consolidation, Takeover, Integration, or Conversion, offline to OJK.

Article 80
(1) Requests to obtain licenses and/or submission of documents on Merger, Consolidation, Takeover, Integration, or Conversion, including correspondence submitted to OJK offline as referred to in Article 79 paragraph (3), are addressed to:

a. The Licensing and Banking Information Department for BUK and KCBLN; and/or b. The Sharia Banking Regulation and Licensing Directorate for BUS, in the event of a Merger, Consolidation, or Integration that includes BUS, a Takeover carried out by BUS, or a Conversion that will become BUS, with copies to:
a. The Supervision Department of the Relevant Bank or OJK Regional Office in Jakarta, for Banks with headquarters or KCBLN domiciled in the Special Capital Region of Jakarta Province and Banten Province; or b. The local OJK Regional Office, for Banks with headquarters or KCBLN domiciled outside the Special Capital Region of Jakarta Province and Banten Province. (2) Submission of reports on the implementation of Merger, Consolidation, Takeover, Integration, or Conversion, including correspondence submitted to OJK offline as referred to in Article 79 paragraph (3), is addressed to:
a. The Supervision Department of the Relevant Bank or OJK Regional Office in Jakarta, for Banks with headquarters or KCBLN domiciled in the Special Capital Region of Jakarta Province and Banten Province; or b. The local OJK Regional Office, for Banks with headquarters or KCBLN domiciled outside the Special Capital Region of Jakarta Province and Banten Province, with copies to:
a. The Licensing and Banking Information Department for BUK and KCBLN; and/or b. The Sharia Banking Regulation and Licensing Directorate for BUS, in the event of a Merger, Consolidation, or Integration that includes BUS, a Takeover carried out by BUS, or a Conversion that will become BUS.

Article 81
OJK may return the request for Merger, Consolidation, Takeover, Integration, or Conversion in the event that the relevant requirement documents for Merger, Consolidation, Takeover, Integration, or Conversion are incomplete and/or do not meet the requirements.

CHAPTER VIII
TRANSITIONAL PROVISIONS

Article 82
Banks that are in the process of implementing Merger, Consolidation, Takeover, or Integration at the time this OJK Regulation comes into force shall continue to follow the relevant provisions before this OJK Regulation came into force, provided that they have announced a summary of the Merger, Consolidation, Takeover, or Integration.

Article 83
The adjustment of the obligation to submit periodic bank reports for Banks and/or KCBLN that carry out Merger, Consolidation, Takeover, Integration, or Conversion, both for the final period before and the initial period after Merger, Consolidation, Takeover, Integration, or Conversion, is established by OJK.

CHAPTER IX
CLOSING PROVISIONS

Article 84
With the implementation of this OJK Regulation:
a. The Decision of the Board of Directors of Bank Indonesia Number 32/50/KEP/DIR regarding Requirements and Procedures for the Purchase of General Bank Shares; and

b. The Decision of the Board of Directors of Bank Indonesia Number 32/51/KEP/DIR regarding Requirements and Procedures for the Merger, Consolidation and Acquisition of General Banks; are revoked and declared invalid.

Article 85
This OJK Regulation comes into force on the date of its promulgation.

In order that everyone may know it, it is ordered to promulgate this OJK Regulation by placing it in the State Gazette of the Republic of Indonesia.

Established in Jakarta on 23 December 2019
CHAIRMAN OF THE COMMISSIONERS BOARD
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA, signature
WIMBOH SANTOSO

Promulgated in Jakarta on 26 December 2019
MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA, signature
YASONNA H LAOLY

STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2019 NUMBER 256 This copy is in accordance with the original Director of Legal Affairs 1 Legal Department sign Yuliana

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
REPUBLIC OF INDONESIA
NUMBER 41/POJK.03/20192019
REGARDING
MERGER, CONSOLIDATION, TAKEOVER, INTEGRATION,
AND CONVERSION OF GENERAL BANKS

I. GENERAL
In carrying out its functions and responsibilities to the public, Indonesian banking is required to always be responsive to the development of the national and international economy which is moving quickly accompanied by increasingly dynamic and complex challenges. This condition is driven by the fact that Indonesia has great potential to grow and develop into a developed country in the future. Such great potential requires support for investment and financing from all Domestic Financial Sector (SJK) including the banking industry, as well as attracting interest from SJK in the regional and global sectors to participate in the share of investment.

In addition, the implementation of the ASEAN Economic Community (MEA) and the existence of KCBLN or Banks with foreign ownership can create opportunities to support national economic growth, as well as cause banking competition at the regional and global levels to become increasingly competitive. The above conditions require strengthening of the Indonesian banking sector.

Furthermore, the rapid development of information technology requires Indonesian banks to be responsive in carrying out their functions. The era of technological disruption that permeates the financial industry, particularly banking, will play a significant role in the future development of the banking industry, making the level of competition increasingly competitive, so that Banks with strong, efficient, innovative structures, as well as reliable management and risk mitigation, will win the competition.

To create a strong and competitive banking system, it is necessary to strengthen the banking structure through Merger, Consolidation, Takeover, Integration, and Conversion. In relation to the above, regulations regarding Merger, Consolidation, Takeover, Integration, and Conversion of General Banks are needed.

II. ARTICLE BY ARTICLE

Article 1
Clear enough.

Article 2
Paragraph (1)
Letter a
Bank initiatives also include Merger and Consolidation of Banks in the handling of Deposit Insurance Institution.
Letter b
Merger, Consolidation, Takeover, Integration, and Conversion in connection with OJK supervisory actions or based on OJK's assessment to realize a strong, efficient, and competitive banking industry. Paragraph (2) Clear enough.

Article 3
Clear enough.

Article 4
Paragraph (1)
What is meant by "business activity change license" is the business activity change license of BUK becoming BUS as referred to in OJK Regulations regarding the change of conventional bank business activities to Islamic banks. Paragraph (2) Clear enough.

Article 5
Paragraph (1)
Clear enough.
Paragraph (2)
Cannot be resolved yet due to unavoidable circumstances (force majeure) or other considerations that can be accepted by OJK.
Force majeure includes fire, mass riots, war, armed conflict, sabotage, and natural disasters such as earthquakes or floods, which are justified by officials of the competent local agency.

Article 6
Clear enough.

Article 7
Clear enough.

Article 8
Clear enough.

Article 9
Letter a
Number 1
The composition and names of members of the Sharia Supervisory Board if there is a BUS that will carry out Merger or Consolidation.
Number 2
Clear enough.
Number 3
Financial reports and financial performance information, namely as referred to in OJK Regulations regarding transparency and publication of bank reports.
Fiscal year is the year starting from January to December.
Letter b
Number 1
Clear enough.
Number 2
Clear enough.
Number 3
Clear enough.
Number 4
If there are interim period financial reports and financial performance information, the disclosure is presented with a comparison of the same interim period from the previous fiscal year (not necessarily audited), except for the financial position report which must be audited. Number 5 In the manner of share conversion, the fair value of shares of the Bank merging and the fair value of shares of the Bank receiving the Merger, or the fair value of shares of the Banks consolidating, are established to determine the share exchange ratio in the context of share conversion. Number 6 Clear enough. Number 7 Clear enough. Number 8 Clear enough. Number 9 Clear enough.

Number 10
Clear enough.
Number 11
Summary of the independent valuation report includes among others estimates regarding matters related to profits and losses and the prospects of the Bank that can be obtained from the Merger or Consolidation. Number 12 Clear enough. Number 13 Clear enough. Letter c Number 1 Share ownership structure contains the composition of shareholders including PSP (including the business group structure related to the legal entity as the Bank PSP up to the last PSP), in accordance with OJK Regulations regarding the assessment of competence and propriety for principal parties of financial service institutions. Composition and names of members of the Sharia Supervisory Board if the Bank resulting from Merger or Consolidation is BUS. Number 2 Clear enough. Number 3 Pro forma financial data of the Bank, namely the financial position report, profit and loss report and other comprehensive income report, statement of changes in equity, calculation of minimum capital provision obligations, and financial ratios of the Bank. Number 4 Projection of the Bank's health level, namely the projection of the health level of the Bank resulting from Merger or Consolidation for 2 (two) health assessment periods after the estimated effective date of the Merger or Consolidation. Number 5 Clear enough.

Number 6
Clear enough.
Number 7
Clear enough.
Number 8
Draft amendment to the Articles of Association is submitted if there are changes.
Number 9
Clear enough.

Article 10
Paragraph (1)
Clear enough.
Paragraph (2)
Letter a
The summary of the draft Merger or Consolidation announced is carried out without reducing the substance in the draft Merger or Consolidation.
Letter b
Clear enough.
Paragraph (3)
The announcement is intended to give interested parties the opportunity to know about the Merger or Consolidation plan and file objections if they feel their interests are harmed. Paragraph (4) Clear enough.

Article 11
Letter a
Clear enough.
Letter b
Clear enough.
Letter c
Details of administrative requirement documents for prospective members of the Board of Directors and prospective members of the Board of Commissioners as well as prospective PSP of the Bank resulting from Merger or Consolidation submitted to OJK as regulated in OJK regulations regarding the assessment of competence and propriety for prospective controlling shareholders, prospective members of the board of directors and prospective members of the board of commissioners of banks. Details of administrative requirement documents for prospective members of the Sharia Supervisory Board as regulated in legislation regarding Islamic general banks.

Article 12
Written announcement to employees is signed by the Board of Directors.

Article 13
Clear enough.

Article 14
Clear enough.

Article 15
Clear enough.

Article 16
Paragraph (1)
Clear enough.
Paragraph (2)
Clear enough.
Paragraph (3)
The deed of establishment contains the articles of association and other information related to the establishment of the Bank.

Article 17
Paragraph (1)
In the event that the request for a license for Merger or Consolidation to OJK exceeds the time limit, the Bank to carry out the Merger or Consolidation submits information on the reasons for the delay to OJK.

Paragraph (2)
Clear enough.
Paragraph (3)
Clear enough.

Article 18
Paragraph (1)
Clear enough.
Paragraph (2)
Clear enough.
Paragraph (3)
Letter a
Clear enough.
Letter b
Clear enough.
Letter c
Clear enough.
Letter d
Recent financial performance is the financial performance of the Bank carrying out the Merger or Consolidation in the range of submission of the draft Merger or Consolidation until the current financial condition of the Bank carrying out the Merger or Consolidation. Paragraph (4) Clear enough. Paragraph (5) Clear enough.

Article 19
Paragraph (1)
Letter a
Criteria for changes to the Articles of Association that must obtain approval from the Minister or are sufficient to be notified to the Minister as regulated in the Law regarding limited liability companies.

Letter b
Request for legal entity approval refers to the Law regarding limited liability companies.
Paragraph (2)
Clear enough.

Article 20
Clear enough.

Article 21
Clear enough.

Article 22
Clear enough.

Article 23
Paragraph (1)
Provisions for the party taking over in the form of an individual adjust to the provisions for the party taking over in the form of a legal entity, unless specifically regulated. Paragraph (2) Clear enough.

Article 24
Paragraph (1)
Clear enough.
Paragraph (2)
Letter a
Clear enough.
Letter b
Determining direct or indirect management and/or policy of the Bank, namely control actions as referred to in OJK Regulations regarding the assessment of competence and propriety for principal parties of financial service institutions.

Paragraph (3)
Mechanism and implementation of the assessment of competence and propriety refers to OJK Regulations regarding the assessment of competence and propriety for principal parties of financial service institutions.

Article 25
Paragraph (1)
The draft Takeover is prepared by the party to take over in the form of a legal entity.
Paragraph (2)
Clear enough.
Paragraph (3)
Clear enough.

Article 26
Letter a
Number 1
Clear enough.
Number 2
Financial reports and financial performance information for the party to take over in the form of a legal entity other than a Bank is in accordance with legislation.
Financial reports and financial performance information are audited by a public accountant or a public accountant registered with the authority of the country of origin for the party to take over outside the Indonesian legal entity. Letter b Number 1 Clear enough. Number 2 Clear enough. Number 3 In the manner of share conversion, the fair value of shares of the Bank being taken over and the fair value of exchange shares are established to determine the share exchange ratio in the context of share conversion. Number 4 Clear enough. Number 5 Clear enough. Number 6 Clear enough. Number 7 Clear enough. Number 8 Clear enough. Letter c Clear enough.

Article 27
Paragraph (1)
Clear enough.
Paragraph (2)
Letter a
Clear enough.
Letter b
Clear enough.
Letter c
Details of administrative requirement documents for prospective PSP as the party to take over the Bank submitted to OJK as regulated in OJK regulations regarding the assessment of competence and propriety for prospective controlling shareholders, prospective members of the board of directors and prospective members of the board of commissioners of banks.

Article 28
Clear enough.

Article 29
Paragraph (1)
Clear enough.

Paragraph (2)
Letter a
Summary of the draft Takeover announced is carried out without reducing the substance in the draft Takeover.
Letter b
Clear enough.
Paragraph (3)
The announcement is intended to give interested parties the opportunity to know about the Takeover plan and can file objections if they feel their interests are harmed.
Paragraph (4)
Clear enough.

Article 30
Clear enough.

Article 31
Clear enough.

Article 32
Clear enough.

Article 33
Clear enough.

Article 34
Paragraph (1)
Clear enough.
Paragraph (2)
In the event that the request for a license for Takeover to OJK exceeds the time limit, the Bank to be taken over submits information on the reasons for the delay to OJK.
Paragraph (3)
Clear enough.

Paragraph (4)
Clear enough.

Article 35
Paragraph (1)
Clear enough.
Paragraph (2)
Clear enough.
Paragraph (3)
Letter a
Clear enough.
Letter b
Clear enough.
Letter c
Recent financial performance is the financial performance in the range of submission of the draft Takeover until the current financial condition of the Bank to be taken over and the party to take over. Paragraph (4) Clear enough. Paragraph (5) Clear enough.

Article 36
Clear enough.

Article 37
Clear enough.

Article 38
Clear enough.

Article 39
Clear enough.

Article 40
Clear enough.

Article 41
Paragraph (1)
Assessment of competence and propriety as regulated in OJK Regulations regarding the assessment of competence and propriety for principal parties of financial service institutions. Paragraph (2) Clear enough.

Article 42
Clear enough.

Article 43
Paragraph (1)
The Bank to receive Integration is the Bank resulting from Integration.
Paragraph (2)
Approval of Integration from the KCBLN headquarters office is the basis for KCBLN in preparing the draft Integration.
Approval from the KCBLN headquarters office takes into account the mechanism according to applicable provisions for the KCBLN headquarters office.
In the event that the approval process from the KCBLN headquarters office requires shareholder approval, shareholder approval needs to be included together with the approval letter from the competent organ at the KCBLN headquarters office regarding Integration approval. Paragraph (3) Clear enough.

Article 44
Clear enough.

Article 45
Letter a
Number 1
Composition and names of members of the Sharia Supervisory Board if there is a BUS that will carry out Integration.

Number 2
Clear enough.
Number 3
Clear enough.
Number 4
Clear enough.
Number 5
Clear enough.
Letter b
Number 1
Clear enough.
Number 2
Clear enough.
Number 3
If there are interim period financial reports and financial performance information, the disclosure is presented with a comparison of the same interim period from the previous fiscal year (not necessarily audited), except for the financial position report which must be audited. Number 4 Policy for fulfilling other provisions includes among others policies related to fulfilling tax aspects. Number 5 Methods used include among others the acquisition value recording method by the Bank to receive Integration in connection with the transfer of assets and liabilities of KCBLN. Number 6 Clear enough. Number 7 Clear enough. Number 8 Clear enough. Number 9 Clear enough. Number 10 Clear enough.

Number 11
Clear enough.
Number 12
Clear enough.
Number 13
Clear enough.
Letter c
Number 1
Clear enough.
Number 2
Clear enough.
Number 3
Capital structure and shareholders contain the composition of shareholders including PSP (including the business group structure related to the legal entity as the Bank PSP up to the last PSP), in accordance with OJK Regulations regarding the assessment of competence and propriety for principal parties of financial service institutions. Number 4 Pro forma financial data covers at least the financial position report, profit and loss report and other comprehensive income report, statement of changes in equity, calculation of minimum capital provision obligations, and financial ratios of the Bank. Number 5 Projection of the Bank's health level, namely the projection of the health level of the Bank for 2 (two) health assessment periods after the estimated effective date of Integration. Number 6 Clear enough. Number 7 Clear enough. Number 8 Clear enough. Number 9 Clear enough.

Article 46
Paragraph (1)
Clearly stated.
Paragraph (2)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
The Integration Draft is used as the basis for drafting the concept of the Integration Deed.
Letter d
Details of the administrative requirement documents for prospective members of the Board of Directors and prospective members of the Board of Commissioners, as well as prospective PSPs of the Bank resulting from Integration, submitted to the OJK as regulated in the OJK provisions regarding the assessment of competence and propriety for prospective controlling shareholders, prospective members of the board of directors, and prospective members of the board of commissioners of banks. Details of the administrative requirement documents for prospective members of the Sharia Supervisory Board as regulated in legislation regarding Sharia commercial banks.

Article 47
Clearly stated.

Article 48
Paragraph (1)
Clearly stated.
Paragraph (2)
Letter a
The summary of the Integration Draft announced is done without diminishing the substance in the Integration Draft.
Letter b
Clearly stated.

Paragraph (3)
The announcement is intended to give interested parties the opportunity to know about the Integration plan and to file objections if they feel their interests are harmed.
Paragraph (4)
Clearly stated.

Article 49
Clearly stated.

Article 50
Clearly stated.

Article 51
Clearly stated.

Article 52
Clearly stated.

Article 53
Paragraph (1)
Clearly stated.
Paragraph (2)
In the event that the submission of the application for Integration permission to the OJK exceeds the time limit, the Bank and the KCBLN to be integrated submit information on the reasons for the delay to the OJK. Paragraph (3) Letter a The Minutes of the General Meeting of Shareholders (RUPS) of the Bank to receive the Integration, which contains approval of the Integration plan, are stated in a deed made by a notary in the Indonesian language. Letter b Clearly stated.

Letter c
Clearly stated.
Letter d
In the event of changes to the Bank's Articles of Association in connection with the Integration, the changes to the Articles of Association are stated in a deed made by a notary in the Indonesian language. Letter e Clearly stated. Letter f Clearly stated. Paragraph (4) Clearly stated.

Article 54
Paragraph (1)
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Clearly stated.
Letter d
The latest financial performance is the financial performance of the Bank and KCBLN conducting the Integration within the period from the submission of the Integration Draft to the latest financial condition of the Bank and KCBLN conducting the Integration. Paragraph (4) Clearly stated. Paragraph (5) Clearly stated.

Article 55
Clearly stated.

Article 56
Clearly stated.

Article 57
Clearly stated.

Article 58
Clearly stated.

Article 59
Infrastructure of the KCBLN includes, among others, office networks, human resources, information technology systems, work systems and procedures, risk management guidelines, and/or other guidelines, systems, and work procedures, as established for the Bank in accordance with legislation regarding commercial banks and Sharia commercial banks.

Article 60
Clearly stated.

Article 61
Paragraph (1)
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
Letter a
Clearly stated.
Letter b
Business funds, namely the declared business funds, as referred to in OJK regulations regarding the minimum capital provision requirements for commercial banks.
The fulfillment of paid-up capital of at least the total business funds as calculated in the KCBLN's capital components based on the latest financial statements of the KCBLN before the submission of the Conversion permission application is intended to ensure that there is no substantial change to the capital conditions after the Conversion of the KCBLN into a Bank business license.

Article 62
Paragraph (1)
Letter a
Approval from the KCBLN headquarters considers the mechanism in accordance with applicable regulations for the KCBLN headquarters.
In the event that the approval process from the KCBLN headquarters requires approval from shareholders, shareholder approval must be included together with the approval letter from the competent organ at the KCBLN headquarters. Letter b The KCBLN Conversion process into a Bank should, as far as possible, be aligned with the requirements to obtain the principle approval for the establishment of a Bank as a Bank resulting from Conversion. Example:
If the main business portfolio of the KCBLN has previously been the corporate segment, and after Conversion it will also conduct business management in the retail segment, then the business management for the retail segment must be included in the fulfillment of documents to obtain principle approval as regulated in legislation regarding commercial banks and Sharia commercial banks. Paragraph (2) Clearly stated.

Paragraph (3)
Letter a
The explanation of the Conversion must at least contain the reasons and objectives of the Conversion.
Letter b
Clearly stated.
Letter c
If there are interim financial statements and interim financial performance information, the disclosure is presented with a comparison to the same interim period of the previous fiscal year (not necessarily audited), except for the statement of financial position which must be audited. Letter d Clearly stated. Letter e Clearly stated. Letter f Clearly stated. Letter g The methods used include, among others, the cost method recording by the Bank as the Bank resulting from Conversion in connection with the transfer of assets and liabilities of the KCBLN. Letter h Projection of the health level of the Bank as the Bank resulting from Conversion is the projection of the health level of the Bank resulting from Conversion for 2 (two) health level assessment periods after the estimated effective date of the Conversion. Letter i Clearly stated. Letter j Clearly stated. Letter k Clearly stated. Letter l Clearly stated. Letter m Clearly stated.

Paragraph (4)
Clearly stated.

Article 63
Clearly stated.

Article 64
Clearly stated.

Article 65
Clearly stated.

Article 66
Clearly stated.

Article 67
Clearly stated.

Article 68
Clearly stated.

Article 69
Paragraph (1)
Conversely, the application for Conversion permission is declared rejected if the OJK rejects the application for the Bank business license as the Bank resulting from Conversion. Paragraph (2) Clearly stated. Paragraph (3) Force majeure includes, among others, fire, mass riots, war, armed conflict, sabotage, and natural disasters such as earthquakes or floods, which are certified by officials of the competent agency in the local area. Paragraph (4) Clearly stated. Paragraph (5) Clearly stated.

Paragraph (6)
The reporting of the date of business activity implementation is the effective date of the Conversion.

Article 70
Paragraph (1)
The legislation referred to includes, among others, regulations regarding institutional structure, capital, and Bank products and activities.
Paragraph (2)
Clearly stated.

Article 71
Clearly stated.

Article 72
Paragraph (1)
Clearly stated.
Paragraph (2)
Clearly stated.
Paragraph (3)
Clearly stated.
Paragraph (4)
Clearly stated.
Paragraph (5)
Further settlement mechanisms by the Bank resulting from Conversion include, among others, the management and handling of the settlement of rights and obligations, including the settlement of creditor objections of the KCBLN by the Bank resulting from Conversion.

Article 73
Clearly stated.

Article 74
Paragraph (1)
Clearly stated.

Paragraph (2)
Letter a
Clearly stated.
Letter b
Clearly stated.
Letter c
Clearly stated.
Letter d
Clearly stated.
Letter e
Other relevant information includes, among others, changes in the bank name in connection with the merger or absorption of the KCBLN headquarters and the restriction of business lines in the KCBLN as a result of the merger or absorption of the KCBLN headquarters.

Article 75
Clearly stated.

Article 76
Clearly stated.

Article 77
Clearly stated.

Article 78
Paragraph (1)
The fulfillment of other requirements for the Bank resulting from Merger, Absorption, Integration, and Conversion includes, among others, regulations related to exceeding the maximum credit limit or maximum fund disbursement limit, and regulations related to systemic banks. Paragraph (2) Clearly stated. Paragraph (3) Clearly stated. Paragraph (4) Clearly stated.

Article 79
Clearly stated.

Article 80
Clearly stated.

Article 81
Clearly stated.

Article 82
Clearly stated.

Article 83
Clearly stated.

Article 84
Clearly stated.

Article 85
Clearly stated.
SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6445