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consecutive months; c. Total paid-up capital no less than Rp 150 billion;
d. Banks have conducted preparations to implement activities as Foreign Exchange Commercial Bank
covering: organization, human resources, operational guidelines of foreign exchange activities including
administration system and its supervision.
15. Conversion of Business License of Commercial Banks to Rural Banks in the context of Consolidation
Conversion of business licenses of Commercial Banks to Business Licenses of Rural Banks can only be done
with the approval of BI. Such conversion of licenses may be done voluntarily or mandatorily. Voluntary license
conversion shall be conducted if there is a request from the shareholders of Commercial Banks with a core capital
below Rp 100 billion or shareholders of Commercial Banks that must still limit their business activities.
16. Determination of Status and Follow-up of Bank Supervision
BI has the right to determine supervision status of Banks consisting of:
a. Normal supervision; b. Intensive supervision; or
c. Special Supervision.
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Intensive Supervision Special Supervision
Criteria
Banks shall be placed under intensive supervision if they are
considered having potential issues that might endanger the business
continuities, i.e. if they meet one or more of the following criteria:
a. KPMM 8, but less than CAR
that consider having potential losses according to the risk
profile of the Banks set by BI; b. Ratio of core capital tier 1 less
than certain percentage set by BI;
c. Statutory Reserves GWM ratio in rupiah ≥ ratio set for
GWM of Banks, and yet have basic liquidity problems;
d. Credit rasio or non performing loanfinancing more than net
5 from the total credit or total financing;
e. Rating of Bank risks is high based on assessment result to
the total risks composite risk; f. Composite rating of bank
soundness level is 4 or 5; g. Composite rating of bank
soundness level is 3 with rating of management factor of 4 or
5. Banks shall be placed under
special supervision if they are considered having issues that
might endanger the business continuities, i.e. if they meet
one or more of the following criteria:
a. KPMM Ratio CAR 8; b. Staturory Reserves GWM
Ratio in rupiah less than the ratio set for GWM of
the Banks and based on BI assessment:
- Banks have basic liquidity
problems; or -
Banks are experiencing deteriorating development
in a short time; or c. Period of Bank under
intensive supervision has been exceeded.
Period
BI determines that Banks under intensive supervision shall be no
longer than one year as of the date of notification from BI.
In the event banks are determined BI determines that Banks under
special supervision shall be no longer than three months as of
the date of notification from BI.
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Intensive Supervision Special Supervision
Period
to be under intensive supervision due to credits or problems in
financing which settlements is complex, the period of intensive
supervision can be extended 1 time for no longer than 1 year.
Supervisory Measures
1. Instruct Banks to carry out mandatory supervisory
actions by: a. Replacing the Board of
Commissioners andor Board of Directors;
b. Writing of the non- performing loans
financing and calculate the Bank losses with Bank
capitals;
c. Conducting a merger or a consolidation with other
Banks; d. Transferring the entire or
a part of Bank activities to other parties;
e. Selling a part or the entire assets andor liabilities of
Banks to other banks or parties; andor
f. Sell the Bank to buyers willing to take over all
bank liabilities. 2.
Instruct Bank andor Shareholders to submit capital
restoration plan; 1. Instruct Banks to carry out
mandatory supervisory actions by:
a. Replacing the Board of Commissioners andor
Board of Directors; b. Writing of the non-
performing loans financing and calculate
the Bank losses with Bank capitals;
c. Conducting a merger or a consolidation with
other Banks; d. Transferring the entire or
a part of Bank activities to other parties;
e. Sell a part or the entire assets andor liabilities of
Banks to other banks or parties; andor
f. Sell the Bank to buyers willing to take over all
bank liabilities. 2. Instruct Bank to remain
conducting supervisory actions set when the Bank
was under the intensive supervision.
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Intensive Supervision Special Supervision
3. Impose prohibition limitation as follows:
a. Prohibition on capital distribution;
b. Prohibition to make certain transactions with the
related parties andor other parties determined by BI;
c. Limitation on assets
growth, capital investment, new funds provision;
d. Limitation on
implementation of business expansion or new
productsactivities; e.
Limitation on salary payment, remuneration
or other forms equivalent to members of the Board
of Commissioners andor Board of Directors of Banks,
or compensation to related parties;
f. Prohibition to conduct subordinated payment.
3. Impose prohibition
limitation as follows: a. Prohibition against selling
or lowering total assets without approval from
BI, with the exception for SBI or Sharia SBI, Demand
Deposits at BI, inter Bank billings, and SUN
Government Securities or Sharia SUN.
b. Instruct banks to report for any change of banWk
shares ownership less than 10; andor
c. Prohibition to change of ownership for:
1 Shareholders who
have shares equal to or more than 10;
andor 2 PSP, including parties
conducting control to Banks in the business
group structure of Banks unless BI’s
approval has already been obtained.
Banks andor Shareholders of Banks under special supervision
must provide additional capital which should be met during the
period of special supervision.
BI shall freeze certain business activities of Banks under special
supervision no longer than one 1 month during special
supervision period if:
