OJK and Banking Sector Strengthen Climate Resilience Through Indonesia-UK Working Group
OJK and Banking Sector Strengthen Climate Resilience Through Indonesia-UK Working Group
Jakarta, CNBC Indonesia - The Indonesian Financial Services Authority (OJK) together with the national banking industry is strengthening its commitment to support the transition to a low-carbon economy through strengthening climate risk management, increasing the resilience of the banking sector, and expanding international cooperation in the field of sustainable finance. This commitment was affirmed at the 2nd Indonesia Climate Banking Forum (ICBF): Climate Risk Management and Banking Resilience to Support Climate Finance Investment, held in Jakarta, Thursday.
This second ICBF is a continuation of the first forum in 2024, marked by the launch of Climate Risk Management and Scenario Analysis (CRMS) as the initial step in managing climate change risks in a structured and comprehensive manner in the banking sector.
Acting Chairman of the OJK Board of Commissioners, Friderica Widyasari Dewi, said that the transformation of the Indonesian financial system towards a climate-aligned financial system is an integral part of the OJK and the financial services sector’s commitment to supporting national development strategies and policy directions.
“We welcome the strong support from the British Government and the British Embassy in encouraging the formation of a joint Climate Finance Working Group with the OJK. This collaboration is expected to accelerate innovation in transition finance while deepening the strategic partnership between Indonesia and the United Kingdom, as has been reaffirmed by President Prabowo Subianto,” said Friderica, quoted on Thursday (February 26, 2026).
According to her, the OJK views climate risk management as a strategic and forward-looking component in the supervisory architecture, which serves as a bridge to translate national transition policies and global signals into financial sector governance, risk management, and financing allocation.
On this occasion, the OJK together with the British Government launched the Indonesia-UK Strategic Partnership Working Group on Climate Financing as a form of strengthening the strategic partnership between Indonesia and the UK in mobilizing funding to support the sustainable finance agenda.
The formation of this working group is a follow-up to the strategic partnership between Indonesia and the UK agreed upon by President Prabowo Subianto and British Prime Minister Keir Starmer in January.
The inauguration of the Working Group was carried out by UK Minister for the Indo-Pacific Seema Malhotra, British Ambassador to Indonesia Dominic Jermey, Acting Chairman of the OJK Board of Commissioners Friderica Widyasari Dewi and Head of the OJK Banking Supervision Executive Dian Ediana Rae.
Strong Capital
Head of the OJK Banking Supervision Executive, Dian Ediana Rae, said that the banking sector continues to have adequate capital resilience to absorb climate-related pressures in a well-managed transition scenario, as reflected in the CAR ratio which remains above the regulatory provisions.
These results show that the Indonesian banking sector is not only resilient to climate-related risks, but is also in a good position to support Indonesia’s transition to a low-carbon economy.
“A resilient financial system is a key foundation to ensure long-term stability, sustainable growth, and public welfare,” said Dian.
On this occasion, UK Minister for the Indo-Pacific Seema Malhotra emphasized that the challenge of climate risk requires a collective response across authorities and industry players.
“Banks, regulators, and investors are all exposed to climate-related shocks. Therefore, financial regulators and the banking sector need to move in the same direction, at the same speed, and with the same understanding of future risks,” she said.
Furthermore, Seema emphasized that financial system resilience is not only about mitigating risks, but also about the ability to capture green economic opportunities.
“Together, we believe that climate risks can be transformed into climate opportunities through close cooperation and by opening up the financing needed for a stronger and greener future,” she said.
In addition to the launch of the Working Group, the OJK also released two strategic publications, namely the Climate Risk and Banking Resilience Assessment (CBRA) and the Indonesia Banking Sustainability Maturity Report 2025 (SMART).
CBRA is an assessment framework developed by the OJK in collaboration with the Australian Government and Prospera to measure the impact of climate risks on the resilience of the banking sector in a forward-looking manner, while also providing science-based references for the industry in developing transition strategies and strengthening resilience to medium and long-term climate risks.
Meanwhile, SMART is the result of an assessment of the level of maturity of sustainable finance implementation in the national banking sector. This report is expected to be a reference in preparing supervisory policy directions to ensure that the implementation of sustainable finance is carried out in a more structured, measurable, and aligned manner with the national transition agenda.
In the future, the ICBF is planned to be a periodic forum as a forum for coordination and collaboration between authorities, ministries, government agencies, and the financial services industry in providing measurable sustainability policy directions and building market confidence to encourage climate and sustainable finance in a sustainable manner.
(rah/rah)