Post-Pandemi Covid-19 Government Relaxation Policies And Its Implications For Sharia Bank Performance

: Banking as an intermediary institution based on the Sharia Banking Act No. 21 of 2008 mandates collect and distribute funds to the public in a proportionate manner. Proportion means is that the portion that is collected and that which is distributed should be balanced, so that the expected profit maximum. In the 2020 era there was the emergence of the Covid 19 pandemic which resulted in the collection and disproportionate distribution of funds. Funding cannot be channeled optimally, because it is work more focused on improving existing financing as a result of customer defaults due to repayment capacity changes. Conditions that cannot be predicted in advance. Government with authority issued a relaxation policy in the form of restructuring through the Financial Services Authority (OJK) provide solutions that are solutive for customers and banks. Over time customer financing saved and doing well. However, nearing the end of the policy there were many related internal audit findings the quality of the policy. Many customers are policy-justified in current collectibility, but in fact collectibility Non Performance Finance (NPF), namely in the collectibility category 3.4 and 5. Under these conditions, it is certain that the bank will incur a loss due to the provision of Reserves Impairment Losses ( CKPN) formed. Cleansing data carried out on several customers shows that customers already have qualities that cannot be saved as a result of implementing policies government that does not have a time limit, so that within that unspecified period of time have a fatal impact on the quality of customers and have an impact on banking performance or the soundness level of the bank worsened.


Introduction
Islamic financial institutions, especially Islamic banking, are intermediary institutions which has the function of collecting public funds in the form of funding and channeling funds to the public also in the form of financing or financing which has been explicitly stated mandated in the Sharia Banking Act No. 21 of 2008.To reach the level national economic growth, the function of channeling or financing credit must be optimal.Therefore, the policy of the Government authorities in this case OJK (Services Authority Finance) determines the level of Loan Deposit Ratio (LDR) must reach 70% of the funds third parties (DPK), which means that the ratio of loan financing distribution must be up to 70% of third party funds (DPK).
One indicator of banking performance is the distribution of financing.
The higher it is distribution of financing will form a high turnover and directly impact on the profit of Islamic banking.Of course, credit is distributed as well must be prudent and healthy, meaning that the funds distributed do not create arrears which will result in non-performing or non-performing financing Financing/ NPF) As we all know that in February 2020 globally the world experienced during the covid 19 pandemic.Government policy to reduce activities the community, in this case PPKM greatly affects the community and actors MSMEs.What has a very direct impact is the MSME sector due to increase business turnover is the activity of transactions between sellers and buyers face to face advance.This resulted in decreased business turnover and some experienced bankruptcy and indirectly if they apply for financing to the Bank it Submitted: 24-08-2022, Revised: 19-09-2023, Accepted: 30-10-2023 will default occurred.Likewise with employees, the company where he works implementing Work From Home (WFH) which will affect the company's performance and will have an impact on the welfare of employees.If the employee submits financing to Islamic banking, there will be problematic or failed financing pay.Under these conditions, the government, in this case the OJK, establishes a policy relaxation of credit to the community and MSME actors so that it helps and relieves in making installment payments to sharia banking.
Credit relaxation is easing MSME actors to pay installments to banks so that business ventures can run again, relief can take the form of loan restructuring as well as the tenor or term of the loan.And this is valid until March 2023.OJK policy also determines the level of bank collectability during the pandemic covid 19, namely collectability level 1 for debtor customers, meaning debtor customers assumed to be current in credit financing.This applies to all existing debtors Islamic banking and will end in March 2023.This policy is a constructive criticism from banks because it will affect the banking performance itself because the credit relaxation policy is not valid forever and ending March 2023.Besides that, the level of collectability of debtor customer credit financing does not have similarity at collectability level 1 entirely.There are several credit customers experiencing collectability level 2, 3.4 and collectability 5, because this will have an impact on Allowance for Impairment Losses (CKPN).For example, for BJB Syariah credit customers, if the credit customers consist of: Collectability level 2, then CKPN is 20% of operating profit, Collectability level 3 means that the CKPN is 40% of operating profit Collectability level of 4 means that the CKPN is 75% of operating profit Collectability level of 5 means that the CKPN is 100% of operating profit.
Submitted: 24-08-2022, Revised: 19-09-2023, Accepted: 30-10-2023 OJK's policy regarding credit relaxation certainly has an expiration date and when it is valid ends, Islamic banking will face a level of collectability in accordance with reality and will indirectly have an impact on banking revenues and profits sharia.P-ISSN: 2829-5102, E-ISSN: 2829-663X Submitted: 24-08-2022, Revised: 19-09-2023, Accepted: 30-10-2023 including tourism, transportation, hospitality, trade, processing, agriculture, and mining The stimulus policy in question consists of: Assessment of the quality of credit/financing/other provision of funds is only based on accuracy payment of principal and/or interest for credit/financing/other provision of funds with ceiling up to IDR 10 billion; And Improving the quality of credit/financing to be smooth after being restructured during POJK validity period.The provisions of this restructuring can be applied by the Bank regardless limits on credit/financing ceilings or types of debtors.
The method of credit/financing restructuring is carried out as stipulated in OJK regulations regarding asset quality assessment, among others by: lower Theoretical Basis.To carry out and support this research, the authors took data from OJK regulations regarding credit relaxation policies and allowance for impairment losses (CKPN) and other regulations.Executive summary of financial services authority regulation number 11/POJK.03/2020concerning national economic stimulus as countercyclical policies impact of the spread of corona virus disease 2019 (POJK STIMULUS THE IMPACT OF COVID-19) Developments in the spread of coronavirus disease 2019 (COVID-19) have had a significant impact directly or indirectly on the performance and capacity of debtors including debtors micro, small and medium enterprises (MSMEs), so that it has the potential to disrupt performance banking and financial system stability that can affect economic growth.Therefore, to encourage the optimization of the banking intermediation function, maintain financial system stability, and supporting economic growth policies are needed economic stimulus as a countercyclical impact of the spread of COVID-19.The main provisions of the POJK Stimulus Impact of COVID-19 include: This POJK applies to BUK, BUS, UUS, BPR and BPRS.Banks can implement policies that support stimulus for economic growth debtors affected by the spread of COVID-19 including MSME debtors, permanently pay attention to the precautionary principle.Debtors affected by the spread of COVID-19 including MSME debtors are debtors who experience difficulties in fulfilling obligations to the Bank because of the debtor or the debtor's business is affected by the spread of COVID-19,either directly or indirectly directly in the economic sector International Conference on Islamic Economic interest rates extension of time period; reduction of principal arrears; reduction of interest arrears; additional credit/financing facilities; and/or conversion of credit/financing to Temporary Equity Participation.Banks can provide credit/financing/other provision of new funds to debtors who have received special treatment in accordance with this POJK with quality determination credit/financing/other provision of funds is carried out separately with quality previous credit/financing/provision of funds.The Bank submits periodic reports on the implementation of this POJK for supervisory monitoring since the position of data at the end of April 2020.This provision is valid since promulgation until March 31, 2021.From the POJK above it is stated that at point 2 that the stimulus is for debtor customers credit into the current category after restructuring by the bank regardless credit ceiling limits and the type of business of the debtor.In point e it is also stated that the technical restructuring can be in the form of: Lower interest rates Term extension Reduction of principal arrears Reduction of interest arrears.Additional credit facilities Conversion of credit financing into equity participation