BI Redefines Implementation of Prudential Principles for Offshore Bank Loans and Other Liabilities

Bank Indonesia (“ BI ”) recently issued Regulation No. 21/1/PBI/2019 on Offshore Bank Loans and Other Bank Liabilities in Foreign Currencies (“ Regulation 1 /2019 ”), which is intended to uphold prudential principles and ultimately to maintain the stability of the macro-economy and financial systems. [1] In order to achieve the abovementioned goal, Regulation 1/2019 implements prudential banking principles in relation to all offshore loans (Utang Luar Negeri– “ ULN ”) and other liabilities which relate to foreign currencies (“ Other Liabilities ”) and encompasses the following specific provisions: [2]