OJK Implements Relief Measures for Financial Institutions Affected by Sumatra Floods

Regulatory Framework for Disaster Response

The Financial Services Authority (OJK) has activated the provisions of POJK No. 19/2022 concerning Special Treatment for Financial Services Institutions in Certain Areas and Sectors Affected by Disasters. This regulation provides a comprehensive framework for banks to support debtors affected by the recent floods in Sumatra. The POJK allows for special treatment including simplified asset quality assessment and restructuring policies, particularly for loans up to Rp10 billion.

Key Provisions for Affected Debtors

1. Simplified Asset Quality Assessment: For loans up to Rp10 billion, banks can determine asset quality based solely on payment timeliness
2. Restructuring Policies: Restructured loans can be classified as performing immediately without any ceiling limit
3. New Credit Facilities: Banks can provide new loans to affected debtors with separate quality assessment
4. Risk Management: Banks must maintain risk management practices while implementing these measures

Implementation and Monitoring

The OJK has deployed an Emergency Response Team to the affected areas to assess conditions and gather data. Head of Banking Supervision Dian Ediana Rae confirmed that the OJK is continuously monitoring the situation and preparing necessary mitigation measures to ensure financial sector stability. The relief measures are designed to balance between supporting economic recovery and maintaining prudent banking practices.