Imposition of Mandatory Corporate Actions upon Banks: An Attempt to Mitigate the Impact of the Covid-19 Pandemic upon the Stability of the Financial System

In line with the authority granted under Regulation of the Government in Lieu of Law No. 1 of 2020,[1] the Financial Services Authority (Otoritas Jasa Keuangan – “OJK”) has issued Regulation No. 18/POJK.03/2020 of 2020 on Written Orders for the Mitigation of Bank Problems (“Regulation 18/2020”), which sets out various provisions relating to the issuance of written orders to banks instructing them to initiate and/or accept mergers, consolidations, acquisitions and/or integrations (“Corporate Actions”) in order to maintain the overall stability of the financial system during the ongoing COVID-19 pandemic[2] and/or to deal with the threat of an economic/financial crisis.[3] In essence, said provisions address the following matters: