Achievement of The Transformation Program - Bank Sentral Republik Indonesia
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December 09, 2019
Transformation Program Accomplishments
 
IMF-World Bank Annual Meetings 2018
Indonesia was selected to host the IMF-World Bank Annual Meetings in 2018 (AM 2018). The annual meetings are the largest such event in the world of economics and finance, attended by Central Bank Governors and Ministers of Finance from the 189 member countries as well as representatives from the private sector, academia, NGOs and the media.  In total, the participants numbered 15,000.  Accompanying the annual meetings, a number of side events were also organised, including seminars, investment forums, Focus Group Discussions (FGD), workshops and cultural events.  The meetings are expected to confer a number of short and long-term benefits on Indonesia, particularly in terms of increasing reserve assets, trade and investment, while boosting tourism and underpinning Indonesia's leadership status in the region.
 
Integrated Monitoring Real-Time Information System of Foreign Exchange (SiMoDIS)
SiMoDIS represents one of the first steps towards strengthening policy related to the monitoring of foreign exchange from exports, which integrates export and import data, whilst synergising Government and Bank Indonesia policies relating to exports and imports in real-time.  Technically, SiMoDIS will integrate the flow of documents, goods and money through export and import documentation from the Directorate General of Customs and Excise as well as tax file number (NPWP) data from the Directorate General of Taxes with incoming export data and outgoing import data from the Financial Transaction Messaging System and foreign exchange banks.  Consequently, SiMoDIS will provide comprehensive export and import information to the Ministry of Finance and Bank Indonesia.
 
Strengthening Islamic Monetary Operations by Releasing BI Sukuk
Bank Indonesia has expanded the underlying assets for Bank Indonesia Sukuk (SukBI) to include global sukuk held by Bank Indonesia.  In addition, Bank Indonesia has refined the Bank Indonesia Islamic Deposit Facility (FASBIS) based on the recommendations of the National Sharia Board of the Indonesian Ulema Council (DSN-MUI), replacing wadi’ah with ju’alah contracts.  The regulations are effective from 29th April 2019.
 
Financial Market Deepening through IndONIA (Indonesia Overnight Index Average)
IndONIA serves as a benchmark rate for the money market, reflecting actual interest rates in the money market calculated periodically and available to market players as a reference when determining lending rates, price setting and evaluating the performance of financial instruments.  IndONIA is the overnight interbank rate index average for unsecured rupiah lending and borrowing in Indonesia. IndONIA is based on the volume-weighted average of all daily transaction data reported by the banking industry to Bank Indonesia through the commercial bank daily reporting system from 07:00 – 18:00 (WIB), with online corrections extended until 19:00 (WIB).
 
Domestic Non-Deliverable Forwards (DNDF)
Bank Indonesia issued regulations concerning DNDF transactions in order to increase rupiah exchange rate stability, accelerate domestic foreign exchange market deepening and mitigate currency risk.  The regulation also aims to provide economic players an alternative hedging instrument in the domestic foreign exchange market, complementing the existing hedging instruments.  Furthermore, the new regulation will bolster the confidence of exporters, importers and investors when conducting economic and investment activities through greater transaction convenience when hedging against currency risk.
 
Bank Indonesia Regulation concerning the Loan-to-Value Ratio for Property Loans, the Financing-to-Value Ratio for Property Financing and Downpayments on Automotive Loans or Financing (PBI LTV/FTV)
Seeking to stimulate a balanced and quality bank intermediation function that supports national economic growth and maintains financial system stability, Bank Indonesia decided to adopt a more accommodative macroprudential policy stance in the property sector by adjusting: (i) the loan-to-value (LTV) ratio for property loans as well as the financing-to-value (FTV) ratio for property financing; (ii) the maximum number of mortgage facilities for under-construction (indent) property purchases; and (iii) the regulations stipulating the period and total of loan disbursements for indent property purchases.
 
Countercyclical Capital Buffer (CCyB)
The countercyclical capital buffer is intended to protect the banking industry against losses incurred from excessive credit and/or financing growth that could potentially disrupt financial system stability.  One goal of CCyB policy is to prevent a build-up of systemic risk from excessive credit growth.  This stems from procyclical bank lending, which accelerates during an expansion, or boom, period and decelerates during a contraction, or bust, period.  In May 2019, Bank Indonesia held the CCyB ratio at 0%.
 
Intraday Liquidity Facility (ILF)
Bank Indonesia issued this regulation in order to meet demand for an uninterrupted, secure, efficient and reliable payment system through regulations concerning an adequate pre-fund upon sending a settlement instruction.  This was done to prevent delayed settlement instructions, enhance customer protection and create market discipline.
 
Foreign Banknote Regulations
  1. Regulatory harmonisation, particularly in terms of the sanctions applicable for violations of the Bank Indonesia regulation on carrying foreign banknotes with prevailing customs laws and other regulations concerning carrying foreign banknotes into and out of the customs territory of the Republic of Indonesia. 
  2. Increasing the effectiveness of law enforcement regarding violations of prevailing regulations on carrying foreign banknotes, thereby minimising the unauthorised carrying of foreign banknotes without appropriate underlying documentation.
  3. Strengthening the monitoring facilities regarding the carrying of foreign banknotes through mandatory periodic reporting by the respective licensed entity to bank Indonesia.

 

Expansion of Local Currency Settlement (LCS)

In conjunction with Bank Negara Malaysia, Bangko Sentral ng Pilipinas and the Bank of Thailand, Bank Indonesia is committed to advocating and advancing the local currency settlement framework in the region with the signing of three Letters of Intent (LOI). The three LOI are a reflection of joint interest to explore a possible LCS framework between the four countries.  The LCS framework is expected to facilitate more efficient economic and financial activities between Indonesia, Malaysia, the Philippines and Thailand.  In addition, Bank Indonesia and the Bank of Thailand have also agreed to explore the possibility of expanding the scope of the current LCS framework.

BI Religi

Seeking to create professional and competent human resources with strong leadership qualities and integrity, Bank Indonesia is internalising religious values in the day-to-day execution of work duties through communal worship and the wisdom of God, so that employees could provide a tangible and optimal contribution to Bank Indonesia.  

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