Regulation Watch · Business Licensing · Indonesia. The regulation applies nationally to conventional commercial banks with exposures affected by country risk or transfer risk. It is relevant to Indonesian banks, Indonesian branches of banks headquartered abroad, controlling shareholders, directors, commissioners, risk and finance functions, treasury and credit teams, and banking groups with cross-border assets, counterparties, funding or operations.
OJK Requires Country and Transfer Risk Controls for Conventional Banks
OJK PADK 10/2026 requires conventional commercial banks to identify international exposures, calculate country and transfer risk ratios, maintain risk controls and provisions, and report the exposures to OJK.
- Published
- Established by OJK on 21 September 2026. OJK added the official regulation page and signed text to its regulation index on 30 September 2026. The official OJK metadata identifies the establishment date but does not state a separate State Gazette or State Bulletin promulgation date for this Peraturan Anggota Dewan Komisioner.
- Effective
- 21 September 2026, the date of establishment stated by OJK. The regulation contains no general transition period in the official summary.
- Added to Watch
- 3 November 2026
Who is affected
Conventional commercial banks with foreign-country or cross-border exposures, including Indonesian branches of foreign banks within the underlying commercial-bank governance framework; controlling shareholders; directors and commissioners; banking groups; and risk-management, credit, treasury, finance, accounting, capital, compliance, internal-audit, data and regulatory-reporting teams.
Practical impact
PADK 10/2026 turns the country-risk and transfer-risk governance duties in the commercial-bank risk and governance rules into an operating framework. A bank must determine which exposures are affected, calculate the prescribed country and transfer risk ratio, implement identification, measurement, monitoring and control processes, form the required provisions, and report the exposures to OJK. The underlying governance rule also requires directors to set strategy and limits, maintain policies and management information, monitor country conditions, control credit exposure by country, region, person and counterparty, and perform periodic stress testing. Commissioners must evaluate the strategy, policies and directors' accountability. The rule can therefore affect risk appetite, cross-border lending, placements, securities, guarantees, intragroup exposure, provisioning, capital planning and transaction approval.
OJK established PADK 10/2026 on 21 September 2026 and states that it took effect that day. OJK added the official page, signed text, abstract and FAQ to its regulation index on 30 September. The official metadata does not identify a separate State Gazette or State Bulletin promulgation date for this Peraturan Anggota Dewan Komisioner.
The regulation applies to conventional commercial banks with exposure affected by country risk or transfer risk. Country risk concerns loss arising from conditions in another country, while transfer risk concerns the possibility that an obligor cannot convert or transfer funds needed to meet an external obligation. The framework is especially relevant to banks with cross-border loans, placements, securities, guarantees, trade finance, intragroup positions or foreign counterparties.
OJK's official abstract identifies five operating duties. A bank must determine the affected exposures, calculate the country and transfer risk ratio, apply the required risk-management process, form provisions and submit exposure reports to OJK. These requirements make the rule a finance, capital, credit, treasury, data and reporting control rather than only a board-policy statement.
The underlying POJK 17/2023 governance framework assigns direct responsibilities to directors and commissioners. Directors must set the strategy and limits, maintain policies and procedures, monitor country conditions, control credit exposure by country, region, person and counterparty, maintain reliable management information and perform stress testing at least annually or when a significant event arises. Commissioners must evaluate the strategy and policies, assess directors' accountability and direct corrective action.
An affected bank should connect the PADK calculation and report to the same exposure data used for credit approval, treasury limits, provisioning, capital planning and stress testing. Cross-border and intragroup positions should not be left in separate systems that cannot be aggregated by country or counterparty. Risk, finance, compliance and internal audit should be able to reproduce the reported amount and show the approval trail.
The rule has already applied since 21 September and the official summary states no general transition period. Banks should therefore verify current compliance immediately, using the signed PADK and attachments for the exact calculation, provision and report format. The official summary does not state a separate new fine schedule, but an incorrect ratio, inadequate provision, weak governance or inaccurate OJK report can still trigger supervisory findings and enforcement under the wider commercial-bank framework.
Required action
- Map every balance-sheet and off-balance-sheet international exposure to the country, obligor, counterparty, group, currency, transfer restriction and risk owner required by the OJK framework.
- Apply the official PADK calculation and reporting attachments to determine the country and transfer risk ratio, required provisions and OJK report for each applicable reporting position.
- Update the board-approved risk strategy, country limits, transfer-risk limits, credit and treasury procedures, escalation triggers and exception authority so they match the bank's actual international exposure.
- Confirm that management information can aggregate exposure by country, region, obligor, counterparty and intragroup relationship accurately and on time, including off-balance-sheet commitments and guarantees.
- Run and document stress testing at least annually and whenever a significant geopolitical, monetary, trade, convertibility or transfer event may affect the bank, then record the resulting limit, provision, pricing or capital action.
- Reconcile the risk calculation, accounting provision, capital plan and OJK report before submission, with documented review by risk, finance, compliance and the responsible directors.
- Prepare directors and commissioners to evidence their respective approval, oversight, evaluation and corrective-action responsibilities during OJK supervision or internal audit.