Releases Two New Regulations, OJK Expects BPR Performance To Be More Steady

Illustration (Photo: Doc. Antara)

JAKARTA - The Financial Services Authority (OJK) is said to have just issued two Financial Services Authority Regulations (POJK) in the banking sector aimed at encouraging credit distribution and strengthening the health of conventional and sharia Rural Banks (BPR).

The Chief Executive of OJK Banking Supervision Heru Kristiyana said that this pair of policies was aimed at encouraging increased implementation of risk management and governance for BPRs and BPRS in order to provide innovative services and products that suit customer needs.

"The dynamic development of the BPR and BPRS industries must be accompanied by strengthening aspects of risk management and governance so that their business continuity can be maintained, agile and resilient," he said in a press statement on Monday, April 18.

According to Heru, the implementation of risk management and governance is also expected to reduce negative surprising events, such as fraud and liquidity risk, which can affect the performance of BPR and BPRS.

“The implementation of risk management and governance at BPRs and BPRS is also part of pillar 1 strengthening the structure and competitive advantage of the Indonesian Banking Development Roadmap for BPRs and BPRS. So that it can support the achievement of improving the performance and growth of the BPR and BPRS industry in a sustainable manner," he said.

Furthermore, Heru also revealed about the assessment of the soundness of BPR and BPRS using a risk approach with a scope of assessment of risk profile factors, governance, profitability, and capital, through a comprehensive and structured analysis.

He said, the assessment of the health level was carried out by BPRs and BPRSs at least on a semi-annual basis and would take effect from the December 2022 report for the trial phase and the imposition of sanctions effective as of the December 2023 report.

"Until February 2022, OJK recorded that there were 1,464 BPRs and 164 BPRS with total assets of IDR 187.15 trillion and serving more than 14 million customers throughout Indonesia," he concluded.