Banking Sector Has Not Recovered, OJK Will Extend Credit Restructuring?

JAKARTA - Chairman of the Board of Commissioners of the Financial Services Authority (OJK) Wimboh Santoso will consider requests from the banking industry regarding the extension of the credit restructuring policy period.

Wimboh acknowledged that there is room to extend the credit restructuring policy. Currently, he is still looking at whether the banking sector can recover quickly from the impact of COVID-19 or not.

"If it has not (recovered), we have also given the POJK space that this can be extended if necessary," he explained, in an Indef weiminar entitled 'Challenges to Arrange the Architecture of the Financial Sector in the Middle of a Global Pandemic', Thursday, July 23.

Currently OJK is monitoring the realization of credit relief for debtors affected by COVID-19. Wimboh said the decision to extend the policy or not depends on how fast the national economic recovery takes place.

"Maybe we can recover (recover) quickly, but we will break up later," he explained.

The relaxation of credit restructuring is stipulated in OJK Regulation Number 11 of 2020 concerning National Economic Stimulus as a Countercyclical Policy. The regulation regulates the restructuring period, which is one year after the regulation takes effect or until March 2021.

Wimboh said that, until June 22, the restructuring of loans that had been carried out by national banks reached Rp. 695.34 trillion, consisting of Rp. 307.8 trillion for MSME sector loans, and Rp.

On the same occasion, Deputy Commissioner for Banking Supervision I of OJK Teguh Supangkat explained that his party is currently paying attention to debtors whose economies have and have not yet recovered with this credit relief policy.

Teguh said that the growth of the credit restructuring realization had slumped in July. In line with the increase in economic activity, which resulted in a decrease in demand for installment relief.

"So, how much of this restructuring needs to be anticipated, how much of this restructuring has not recovered and how many have recovered," he explained.

Teguh said that in the future, banks need to establish CKPN (Reserve for Impairment Losses) when the POJK 11 stimulus is due.