OJK Publishes Regulatory Policy Package for Banks Amid COVID-19 Crisis
OJK published a policy package that sets out relaxations to certain regulatory capital and liquidity risk framework provisions in the banking sector to help maintain financial sector stability amid COVID-19 pandemic. The policy package for commercial banks includes relaxation measures related to reporting, credit treatment, and governance of restructured credit or financing in accordance with the Circular POJK No.11/POJK.03/2020. The package also addresses adjustment of implementation of several banking regulations and postponement of implementation of Basel III reforms. Moreover, OJK relaxed policy measures for rural credit banks and "Islamic People's Financing Banks." It published a circular on amendments to the minimum capital requirements and fulfillment of minimum core capital for Sharia rural banks. The amendments have been in effect from May 20, 2020. Additionally, OJK issued a statement highlighting that the stability of the financial services sector has been maintained until May, even amid the COVID-19 pandemic.
The relaxation policy package for conventional commercial banks and Sharia commercial banks includes the following measures:
- According to the POJK No.11/POJK.03/2020, restructured credit or financing are reported in the Financial Information Services System (SLIK).
- The obligation to fulfill the Capital Conservation Buffer in the capital component of 2.5% of the Risk Weighted Assets for banks (BUKU 3 and BUKU 4) is temporarily removed until March 31, 2021.
- Obligations to fulfill Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR) for banks (BUKU 3, BUKU 4, and Foreign Banks) must be maintained as low as 85% by March 31, 2021. Banks are required to prepare action plans to return the fulfillment of LCR and NSFR to 100% no later than April 30, 2021.
- Assessment of Foreclosed Collateral Quality based on the term of ownership can be paused until March 31, 2021.
- In line with the announcement by BCBS on March 27, 2020, the implementation of the Basel III reforms standard in Indonesia—which includes the calculation of risk-weighted assets for operational, credit, market, and credit valuation adjustment (CVA) risks—has been postponed to January 01, 2023.
Related Links (in Indonesian)
- Press Release on Policy Package in Response to COVID-19
- Press Release on Financial Sector Stability
- Notification on Amendments to Minimum Capital Requirements for Sharia Rural Banks
Effective Date: May 20, 2020
Keywords: Asia Pacific, Indonesia, Banking, COVID-19, Reporting, Restructured Loans, Regulatory Capital, Liquidity Risk, Credit Risk, LCR, NSFR, Deadline Extension, Basel, Operational Risk, Market Risk, Risk-Weighted Assets, CVA Risk, OJK
Featured Experts

María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer

Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.

Patrycja Oleksza
Applies proficiency and knowledge to regulatory capital and reporting analysis and coordinates business and product strategies in the banking technology area
Previous Article
IOSCO Statement Highlights Importance of Disclosures on COVID ImpactRelated Articles
EC Consults on PSD2 and Open Finance; EU Reaches Agreement on DORA
The European Commission (EC) published a public consultation on the review of revised payment services directive (PSD2) and open finance.
EC Mandates ESAs to Propose Amendments to SFDR Technical Standards
The European Commission (EC) has issued two letters mandating the European Supervisory Authorities (ESAs) to jointly propose amendments to the regulatory technical standards under Sustainable Finance Disclosure Regulation or SFDR.
EBA Examines Supervisory Practices, Issues Deposits Reporting Template
The European Banking Authority (EBA) published its annual report on convergence of supervisory practices for 2021. Additionally, following a request from the European Commission (EC),
US Agency Publications Address Basel, Reporting, and CECL Developments
The Farm Credit Administration published, in the Federal Register, the final rule on implementation of the Current Expected Credit Losses (CECL) methodology for allowances
SEC Extends Comment Period on Climate Risk Disclosures
The U.S. Securities and Exchange Commission (SEC) looks set to intensify focus on crypto-assets and cyber risk and extended the comment period on the proposed rules to enhance and standardize climate-related disclosures for investors.
APRA Reduces Committed Liquidity Facility, Issues Other Updates
The Australian Prudential Regulation Authority (APRA) announced reduction in the aggregate Committed Liquidity Facility and issued an update on the operational preparedness for zero and negative market interest rates.
CMF Consults on Basel Rules, Presents Roadmap to Address Climate Risks
The Commission for the Financial Market (CMF) in Chile published capital adequacy ratios (as of February 2022, January 2022, and December 2021) for 17 banks and for the banking system.
PRA Issues Statement on NPEs and Policy on Trading Activity Wind-Down
The Prudential Regulation Authority (PRA) issued a statement on the European Banking Authority (EBA) guidelines on management of non-performing exposures (NPEs) and forborne exposures.
EBA Updates Standards for 2023 Benchmarking of Internal Approaches
The European Banking Authority (EBA) updated the implementing technical standards that specify the data collection for the 2023 supervisory benchmarking exercise in relation to the internal approaches used in market risk, credit risk, and IFRS 9 accounting.
EIOPA Responds to Stakeholder Views on Blockchain in Insurance
The European Insurance and Occupational Pensions Authority (EIOPA) published a feedback statement on the responses received to the consultation on blockchain and smart contracts in insurance.