SEOJK on the Valuation of Securities Investments for Pension Funds

To:
Pension Fund Managers

COPY

CIRCULAR LETTER OF THE FINANCIAL SERVICES AUTHORITY NUMBER 26 /SEOJK.05/2015

CONCERNING
VALUATION OF SECURITIES INVESTMENTS FOR PENSION FUNDS

In relation to the mandate of Article 2 paragraph (3) of Financial Services Authority Regulation Number 3/POJK.05/2015 concerning Pension Fund Investments, it is necessary to regulate the basis for valuing securities investments, including securities issued by Bank Indonesia, government securities, and corporate bonds listed on the Indonesia Stock Exchange, including securities using Sharia principles, as follows in the Financial Services Authority Circular Letter:

I. GENERAL PROVISIONS

1. That the impact of current global financial conditions has caused the market value of securities investments to show abnormal values and has caused the solvency level of pension funds to drop below 100% (one hundred percent).
2. That in relation to securities investments showing abnormal values, it is necessary to provide stimulus for Pension Funds in the valuation of securities investments to reflect fair values.

II. VALUATION OF SECURITIES INVESTMENTS
Pension Funds may value securities investments using final redemption value without being supported by written documents or amortized acquisition cost.

III. APPLICATION OF SECURITIES INVESTMENT VALUATION
Pension Funds that meet the criteria in Roman numeral I item 1 may apply the provisions as referred to in Roman numeral II.

IV. CLOSING ... -2-

IV. CLOSING
The provisions in this Financial Services Authority Circular Letter shall take effect on the date of determination.

Determined in Jakarta on August 31, 2015

EXECUTIVE HEAD OF INSURANCE, PENSION FUND,
LENDING INSTITUTION, AND
OTHER FINANCIAL INSTITUTION SUPERVISOR
FINANCIAL SERVICES AUTHORITY,

signed

FIRDAUS DJAELANI

Copy in accordance with the original
Director of Law 1
Law Department

signed

Sudarmaji