OJK Warns Kresna Life Regarding Written Approval for Converting Obligations to Policyholders into SOL

- 17 February 2023 15:10 WIB
Illustration. Office building of the Financial Services Authority, or OJK, in Jakarta. (Special)
Illustration. Office building of the Financial Services Authority, or OJK, in Jakarta. (Special)

JAKARTADAILY.ID - Chief Executive of Pension Fund Insurance Supervision for Financing Institutions, Ogi Prastomiyono, said that the OJK has not yet received written statements from Kresna Life from each policyholder regarding approval of the liability conversion scheme into subordinated loans (SOL).

The document has been requested to be submitted no later than February 13, 2023.

Ogi explained that in the last RPK submitted by Kresna Life, there was no alternative for additional capital injection from PSP or cooperating with strategic investors, but with a scheme to convert obligations to policyholders into SOL.

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For this reason, written approval from policyholders is required after they are given a comprehensive understanding of SOL including its consequences.

In addition, if the SOL conversion amount is not sufficient for the calculation of the solvency ratio, PSP must deposit additional capital until the solvency ratio is met.

Changing the obligations to policyholders to SOL will make the company's finances healthy, but cannot help liquidity because there is no inflow of funds as additional capital.

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In connection with the conversion referred to there are several points related to the SOL conversion that need public attention, including:

1. SOL conversion must obtain written approval from the policyholder, so Kresna Life must submit a document signed by the policyholder stating his willingness to convert SOL.

2. Until the specified time limit, OJK has not received a written approval document from each policyholder regarding the conversion of SOL. Written approval is required for the calculation of the Company's solvency.

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If based on the calculations there are still deficiencies, the Controlling Shareholders must increase capital to cover these deficiencies and set them into the Kresna Life RPK.

3. In order to be taken into account in solvency, the SOL scheme has several criteria that have potential risks for policyholders, so the OJK asked Kresna Life to convey these risks transparently to policyholders. These risks include:


Editor: Suksmajati Kumara


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