Indonesia

7 banks in Indonesia signed a commitment to achieve the Indonesia Net Zero Emission (NZE) target

OJK will require large banks to submit CRMS results by July 2024, and followed by set up the policies recommendation based on the industry consultation process between 2024 and 2025. The policies will be targeted to be implemented in 2026 for banking sectors.

OJK publishes Climate Risk Management & Scenario Analysis Guidelines (CRMS)

OJK publishes Indonesia Taxonomy for Sustainable Finance

OJK issues Financial Services Authority Circular Letter No. 12/SEOJK.04/2023 on the Procedures for Organizing Carbon Trading through Carbon Exchanges

Indonesia issued the P2SK Law (Financial Sector Omnibus Law) which regulates the framework for Indonesia's sustainable financial development, such as the mandate to establish a sustainable finance committee and sustainable taxonomy.

BI has issued BI regulation (PBI) No.11/2023 regarding the Macroprudential Liquidity Incentive Policy. This regulation reduces reserve requirements up to 50 bps for banks that provide mortgages on eco-friendly properties and loans aimed at purchasing electric vehicles.

OJK issues Regulation No. 14 of 2023 on the Carbon Trading through Carbon Exchange

OJK issues Regulation No. 17 of 2023 on the Implementation of Governance for Commercial Banks. Banks are required to manage climate-related risks under this regulation.

MoF issued a Regulation No. 103/2023 on Fiscal Support for Financing System for Energy Transition on the Electricity Sector as a guideline for climate financing, especially on blended finance mechanism for coal early retirement, renewable energy development, and grid improvement projects

MoF issued a Decree No. 470/2023 on the Formation of Energy Transition Mechanism Country Platform Steering Committee, to kickstart the implementation and management of the blended financing as mandated by MoF Regulation No. 103/2023 for energy transition projects

Initial phase of the Guidelines on Climate Risk Stress Testing for the Banking Sector (Volume 1.0)

OJK issues Regulation No. 18 of 2023 on the Issuance and Terms of Debt Securities and Sustainability-Based Sukuk, which amend POJK No. 60/POJK.04/2017.

BI in collaboration with IO and NGO conducted research on climate transition risk and its impact to Indonesia's economy

OJK conducts a pilot project for Indonesia Green Taxonomy Implementation which involves all commercial banks in Indonesia

Launching the Indonesian Carbon Exchange

BI supports the presence of the Asian Green Bond Fund to promote green financial instrument

OJK conducts a pilot project for Indonesia Green Taxonomy Implementation which involves large banks in Indonesia

BI initiates an annual research grant in the field of sustainable activities, with up tp eight projects being funded annually.

BI joins the Executives' Meeting of East Asia-Pacific Central Banks (EMEAP) Interest Group on Sustainable Finance

BI publishes study on the Green MSME Business Model Development

OJK issues Consultative Paper: Prinsip Manajemen Efektif Atas Risiko Keuangan terkait Iklim (Based on BCBS Consultative Paper: Principles for the effective management and supervision of climate-related financial risks)

Publication of Indonesia Green Taxonomy (Edition 1.0)

BI has issued BI regulation (PBI) No.24/4/PBI/2022 regarding Reserve Requirements. This regulation reduces reserve requirements by up to 30 bps for banks that provide mortgages on eco-friendly properties and loans aimed at purchasing electric vehicles.

BI has issued BI regulation (PBI) No.24/3/PBI/2022 regarding the Macroprudential Inclusive Financing Ratio requirements (MIFR). This regulation relaxes the MIFR requirements by allowing banks to meet these requirements by either purchasing sustainable bonds or providing loans to the SDG Indonesia One. SDG Indonesia One is a green blended finance platform managed by PT. SMI, a state-owned corporation.

OJK issues Financial Services Authority Circular Letter No. 16/SEOJK.04/2021 on the Form and Content of Annual Report of Issuers or Public Companies

OJK publishes the Sustainable Finance Roadmap Phase II (2021- 2025); Indonesia Banking Development Roadmap (RP2I) 2020 – 2025; Indonesia Financial Services Sector Master Plan (MPSJKI) 2021-2025; and Indonesia Islamic Banking Development Roadmap 2020-2025

OJK publishes Technical Guidelines for Securities Companies on the Implementation of POJK NO.51/POJK.03/2017 on Sustainable Finance for Financial Services Institutions, Issuers, and Public Companies

BI joins the G20 Sustainable Finance Working Group

Indonesia Stock Exchange launches the IDX ESG Leaders Index that measures price performance of stocks that become leaders in environmental, social, and governance rating and do not have significant controversies, selected from stocks with high trading liquidity and good financial performance

TPN launches SME Green Loan to promote access to finance focusing on supply chain financing, gender financing, and green projects for micro, small, and medium enterprises

BI has issued BI regulation (PBI) No.22/13/PBI/2020 regarding the Loan-to-Value (LTV) ratio and Down Payment (DP) requirements. This regulation provides significant relief in the LTV ratio requirements for mortgages on eco-friendly properties, allowing them to be financed up to 100%. Additionally, it reduces the (DP requirements for loans aimed at purchasing electric vehicles to as low as 0%).

The Government of Indonesia launches the National Economic Recovery Program (PEN)

BI adopts the Sustainable and Responsible Investments framework in managing international reserve and alocating certain amount of the reserve to sustainable bonds.

PT Bank Rakyat Indonesia issues global sustainability bonds for $500 million

The Government of Indonesia issues second sovereign global green sukuk of $750 million

BI joins the NGFS and the ASEAN Senior Level Committee on Sustainable Finance.

BI has issued BI regulation(PBI) No.21/13/PBI/2019 regarding the Loan-to-Value (LTV) ratio and Down Payment (DP) requirements. This regulation eases the LTV ratio requirements for mortgages on eco-friendly properties and reduces the DP requirements for loans intended for the purchase of electric vehicles.

BI issues regulation on loan-to-value (LTV) for green property mortgages to support green building development

Bank OCBC NISP issues a $150 million green medium-term note to IFC as sole investor

PT SMI issues green bonds for 3 trillion Indonesia rupiah (Approximately $200 million)

The Government of Indonesia issues the first sovereign global green sukuk for $1.25 billion

OJK publishes Technical Guidelines for Banks and Banking Supervisors on the Implementation of POJK NO.51/POJK.03/2017 on Sustainable Finance for Financial Services Institutions, Issuers, and Public Companies

OJK issues Regulation No. 51/ POJK.03/2017 on Application of Sustainable Finance to Financial Services Institution, Issuers, and Publicly Listed Companies; and a Regulation on the Issuance and the Terms of Green Bond (POJK No. 60/POJK.04/2017)

OJK in collaboration with the Ministry of Environmental Affairs and Forestry launches the Roadmap for Sustainable Finance in Indonesia (2015-2019)

OJK joins SBFN