Investor Presentaiton
Relaxing the Loan-to-value (LTV) and Financing-to-Value (FTV) Ratios*
1.
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Prudential aspects of Relaxing the Loan-to-value (LTV) and Financing-to-Value (FTV) Ratios
The requirements of the LTV ratio for property credit and FTV ratio for property financing are as follows:
i.
The net ratio of NPL to total credit or NPF to total financing must not exceed 5%; and
ii.
The gross ratio of property NPL to total property credit or property NPF to total financing must not exceed 5%.
Banks must make sure that there is no loan transfer to another borrower at the same bank or different bank for
tenors of less than 1 year. The requirements are valid for banks that will disburse pre-order property loan/financing.
Banks are required to comply with prudential principles when disbursing loans.
4.
Gradual loan liquidation is only allowed for developers that comply with bank's risk management policy (e.g. the
business feasibility of the developer).
5. Banks are required to ensure that transactions to disburse loans (including down payment) and gradual liquidation
must be processed through the debtor and developer/seller's bank account.
LTV / FTV Exemptions
Central government or local government loan / financing programs are exempt from this regulation.
Source: Bank Indonesia
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