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Good Corporate Governance
Good Corporate Governance
PREFACE

Corporate Governance plays a very essential role and is fundamental to the banking industry. Henceforth, Bank SBI Indonesia is committed to duly implement Good Corporate Governance (GCG)at all levels and structure organization.

Implementation of Good Corporate Governance not solely improve bank performance, but to preserve the stakeholder interests, to raise public interests and improve the compliance toward prevailing regulations of banking industry.

To implement good corporate governance practices in Bank SBI Indonesia, the basic principles of corporate governance are based on the principle of Transparency, Accountability, Responsibility, Independency and Fairness.

Reports of GCG implementation as a form of financial and non-financial transparency toward stakeholders, in accordance to PBI No. 8/4/PBI/2006 dated on January 30, 2006 as amended with PBI No. 8/14/PBI/2006 dated on October 5, 2006, along with SE BI No. 15/15/DPNP dated on April 29, 2013 regarding to GCG Implementation for Commercial Bank.

In order to ensure the implementation of 5 (Five) basic principles of GCG, Bank SBI Indonesia regularly conducts self-assessment which includes 11 (eleven) GCG assessment factors, namely:

  1. Implementation of Duties and Responsibilities of Board of Commissioners
  2. Duties and Responsibilities of Board of Directors
  3. Completeness and Duty Implementation of the Committees
  4. Conflict of Interest Handling
  5. Implementation of the Bank’s Compliance Function
  6. Internal Audit Function
  7. External Audit Function
  8. Risk Management Function including Internal Control System
  9. Fund Provision for Related Party and Large Exposures
  10. Transparency of Financial and Non-Financial, Good Corporate Governance Implementation Report and Internal Report
  11. Bank Strategic Plan

To implement the function of Internal Audit effectively, Bank SBI Indonesia have formed Internal Audit Working Division (SKAI). It is an independent division and responsible directly to President Director and further to communicate directly with Board of Commissioner.

The duties and responsibilities of the Internal Audit, among others:

a.  Supporting President Director and Board of Commissioners’ duties in supervising by operationally elaborate planning, implementation or monitoring of audit result.

b.  Possess authority to access all activities for more relevant inspection with the performance and audit activities.

c.  Independent assessment which determined by Bank to inspect and evaluate the company activities.

d.  Conduct investigation if there any indication of fraud.

e.  Preparing implementation reports and fragments of audit result to be conveyed to OJK.

During 2015, SKAI have implemented internal audit as follows:

1.  Implementation report and audit result of every semester

2.  Audit of Branch Offices and Sub-Branch Offices

3.  Audit of International Banking Division 

4.  Audit of BI RTGS and SKN-BI

5.  Analysis toward findings on interest income June 2015. 

6.  Inspection toward policy and process in determining the fee from utilizing third party services.

Upon inspection result mentioned above, it has been reported to President Director and its copy to Board of Commissioner and Compliance Director.

1.NUMBER, COMPOSITION, CRITERIA AND INDEPENDENCY OF MEMBERS OF THE  BOARD OF DIRECTORS

The composition of the Board of Directors as follows:

  1. President Director              :   Rizal Yamin
  2. Vice President Director       :   Naresh Kumar Sharma
  3. Director                           :   Manoj Kakkar
  4. Director                           :   Sri Hartati

All Board of Directors are domiciled in Indonesia. Board of Directors led by President Director originated from Independence party toward the Shareholder controller. All Director Members of Bank SBI Indonesia do not possess concurrent position as Commissioner, Directors or Executive Officer at Bank, company, and/or other institution as requirements toward provisions of Directors of bank.

2.DUTIES AND RESPONSIBILITIES OF THE BOARD OF DIRECTORS

Board of Directors have conducted the duties and responsibilities as per the provision of Good Corporate Governance. The duties and responsibilities are as under :

1. Board of Directors are fully responsible toward the implementation of Bank management.

2. Board of Directors shall administer the Bank in accordance with its authorities and responsibilities as formulated within Articles of Association and applicable constitutions.

3. Board of Directors shall implement the GCG Principles within every Bank Business Activities at all levels and organizational structure.

4. Board of Directors shall conduct further action upon audit findings and recommendation from all Internal Audit Working Division, External Audit, Supervision result of Otoritas Jasa Keuangan, and/or Supervision result of other authorities.

5. Board of Directors shall always provide data and information to Commissioner in complete form, accurate, updated and timely.

6.Composing policies and procedure that ensure progress of Bank business in accordance to provisions

 

3.DIRECTORS MEETING

The Board of Directors meeting of Bank is convened every week for the purpose of defining, among other things, policy and strategic decision. Any meeting decision taken by the Board of Directors will be implemented and has been in accordance with the applicable work policy, guideline and conduct regulations.  All decision-making process in the Board of Directors meeting is conducted on the basis of amicable settlement.

All discussion results of the meeting have been stated in the minutes of meeting and well documented, including the obvious disclosure of dissenting opinions that appear during the meeting.

Bank has formulated Bank’s Business Plan in accordance to vision and mission by considering the changing factor of internal and external, realistic, comprehensive and measurable, and it is approved by Board of Commissioner.

Bank Business Plan have been communicated to shareholders and all organizational structure. Director monitors the implementation of Bank Business Plan based on reports from concerned units.

Whilst submitting the bank business plan, it is guided toward by provision of OJK/Bank Indonesia considering several factors as under :

a.  External and internal factors that affect the continuance of Bank’s business.

b.  Prudential Principles

c.  Implementation of Risk Management.

d.  Sound Banking Provisions.

Commissioner implements the supervision toward bank business based on report of bank performance and discussed in coordination meeting.

Bank SBI Indonesia have provided all financial and non-financial condition transparently within all reports delivered to other external partly.

A.  SHARE OWNERSHIP, FINANCIAL RELATIONSHIP AND FAMILY RELATIONSHIP BETWEEN THE BOARD OF COMMISSIONERS AND DIRECTORS

All members of the Board of Commissioners and Directors do not have 5% or more of share in relevant Bank or in Bank and other companies located in domestic and foreign countries.

All members of the Board of Commissioners and Directors have no financial relationship and family relationship with other members of the Board of Commissioners and Directors and/or the Controlling Shareholders of the Bank.

B. SHARES OPTION AND BUY BACK SHARES

In 2015, there are no shares option and buy back shares performed by members of the Board of Commissioners, the Board of Directors, Executive Officer and Bank’s employees.  In accordance with Article of Association of Bank SBI Indonesia, there is no regulation concerning share option and buy back shares.

 

C.  REMUNERATION PACKET/POLICY AND OTHER FACILITIES FOR THE BOARD OF COMMISSIONERS AND DIRECTORS

All members of the Board of Commissioners and Directors only receive remuneration from Bank and other facilities agreed in General Meeting of Shareholders. In addition, members of the Board of Commissioners and Directors do not use Bank for their private interest, family and/or other parties which causes any harm and bring no profit to Bank.

Bank SBI Indonesia has a standard remuneration ratio by comparison as follows:

- The ratio of the highest Directors salary against the highest Employee salary is 1,984% to 1.          

- The ratio of the highest Directors salary against the lowest Director salary is 1,984 to 1.

- The ratio of the highest Employee salary against the lowest Employee salary is 13, 65% to 1.        

 

Types of Remunerations and Other Facilities

Amount received within 1 year

Board of Commissioners

Board of Directors

Person

Rp

Person

Rp

Remuneration (salary, bonuses, allowance, dividend, and other non-allowance facilities.

2 (two)

379.992.500

4 (four)

2.278.900.452

Other allowance facilities (housing, transportation, health insurance, etc.) which:

a.  can be owned (medical allowance)

b.  cannot be owned (housing)

0 (zero)

 

 

 

 

 

a.  Not available

 

b.  Not available

4 (four)

 

 

 

 

 

a.  Not available

 

b. 804.832.096

TOTAL

2 (two)

379.992.500

5 (five)

3.083.732.548

The number of members of the Board of Commissioners and Directors who receive remuneration packet within one year and categorized based on range of income level is as follows:

Amount of remuneration per person for one year (received in cash)

Number of Directors

Number of Commissioners

Above IDR 2 billion

-

-

Above IDR 1 billion up to 2 billion

1 (one)

-

Above IDR 500 million

3 (three)

-

Under IDR 500 million

-

2 (two)

 

D.  CONFLICT OF INTEREST, INTERNAL FRAUD AND LEGAL ISSUES

During 2015 there were no any reports on transaction performed by the Board of Commissioners, the Board of Directors and Executive Officers which contained conflict of interest.

Bank has policy, system and procedure for the settlement of conflicts of interest that binds every member of management and employee of Bank. With the issuance of policy on conflict of interest, it will expectedly reduce the loss risk level to Bank.

No.

Name and position of person involved in the conflict of interest

Name and position of person involved in the conflict of interest

Types of transaction

Transaction value (in million Rupiah)

Description

-

Not Available

Not Available

Not Available

Not Available

Not Available

Internal Fraud in 1 year

Number of cases committed by

 

Management

Permanent Staff

Non-Permanent Staff

 

Previous year

Current year

Previous year

Current year

Previous year

Current year

Total Fraud

0

0

0

0

0

0

Settled

Not Available

Not Available

Not Available

Not Available

Not Available

Not Available

Internally under process by the bank

Not Available

Not Available

Not Available

Not Available

Not Available

Not Available

Settlement efforts not yet conducted

Not Available

Not Available

Not Available

Not Available

Not Available

Not Available

Already followed-up through legal process

Not Available

Not Available

Not Available

Not Available

Not Available

Not Available

 

 

Legal Issues

Number

Civil/ bankruptcy

 

 

Criminal

Settled (already have permanent legal force)

2

-

Undergoing

1

-

Total

3

-

Such legal cases are related to non-performing loans settlement through litigation.

 

E. FUNDS GRANT FOR SOCIAL ACTIVITIES

As the Bank’s social responsibility to the community, throughout 2014, the Bank have given as follows:

  • Donation for Orphans Board/Management of Graha Mandiri amounting to Rp. 5.855.000,-
  • Donation for Women’s Association (IWA) amounting Rp. 2.000.000,-
  • Donation CSR for Sinabung, Medan amounting Rp. 1.25.000,-
  • Donation in form of free writing books to support schools in need via UNESCO amounting Rp. 20.000.000,-

SELF ASSESSMENT

IMPLEMENTATION OF  GOOD CORPORATE GOVERNANCE (GCG)

Bank Name   :  Bank SBI Indonesia

Position        :  December 2015

Self-assessment Result of GCG Implementation

 

Ranking

Definition of Ranking

 

 

Individual

 

 

2

Bank SBI Indonesia have implemented Good Corporate Governance and in general considered as standard. This is reflected from the adequate fulfilment of Good Corporate Governance principles. If there is weakness in the implementation of Good Corporate Governance principles, generally such weakness is less significant and can be solved with normal action conducted by Bank’s management.

Analysis

General Conclusion of Governance Structure, Governance Process and Governance Outcome:

Bank strives to make efforts to implement GCG in accordance with the provision. Follow-ups to be conducted by bank for the purpose of implementing GCG in a good manner including:

·        The Board of Commissioners and Directors have made efforts and defined strategies in order that financial or non-financial performance agreed in short-term and long-term Bank’s Business Plan can be achieved.

·        Monitoring on Realization which is compared to target of Bank’s Business Plan is discussed in the meeting of the Board of Directors or related Working Unit, thus corrective actions can be implemented to any obstacles.

·        Conducting continuous efforts towards credit governance thus NPL ratio can be controlled as per Bank’s Business Plan including an effort to settle non-performing loan or foreclosed collateral, given the fact that this affect rentability and bank capital factors.

·        Conducting an effort in order that any similar internal or external audit finding will not occur by conducting corrective actions, among other things: revising policy and procedure, improving Direct Supervisory Function. Improvement of role of Internal Control for inspection of daily transaction.

 
 
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Thank you! Your submission has been received!
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08001724636
02139838747

You are visitor number :

For More Information Please Contact 
Gedung Graha Mandiri Lantai 11, 15 & 24 
Jl.Imam Bonjol No.61.
Jakarta Pusat 10310 - INDONESIA 
Email : birdireksi@sbiindo.com 
Tel : +6221.39838747 (hunting)
Fax : +6221.39838750
+6221.39838751 - 39833778