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Bank NTB Syariah: Annual Report 2020

IM Insights
By IM Insights
3 years ago
Bank NTB Syariah: Annual Report 2020

Amanah, Dinar, Fatwa, Halal, Islam, Islamic banking, Murabahah, Shariah, Shariah compliant, Sukuk, Wakalah, Waqf, Zakat, Credit Risk, Ijarah Revenue, Ijarah Contract, Murabahah Receivables, Participation, Provision, Receivables, Reserves, Sales

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  2. Kilas Kinerja 01 Laporan Manajemen PT Bank NTB Syariah . 2020 Annual Report P ro fi l Pe r u s a h a a n An a l i s i s & T i n j u a n K i n e r j a Ke u a n g a n Bertahan di tengah badai
  3. Fu n g s i Pe n u n j a n g B i s n i s Good Corporate G ove r n a n c e Corporate Social Responsibility THE SPIRIT OF AMANAH OPTIMISTIC AND THRIVE IN SUSTAINABLE BUSINESS In 2020 , the national banking industry was facing challenging market conditions due to the tragedy of the Covid-19 pandemic that hit the world. Large-scale social distancing had an impact on the decrease of economic performances in numerous sectors such as transportation, tourism and trade. Bank NTB Syariah always stayed optimistic to maintain the quality and sustainable business growth. Throughout 2020, Bank NTB Syariah had consistently made improvements to business processes and the provision of various banking products and services in line with the needs of society during the outbreak. Therefore, the commitment of Bank NTB Syariah was presented as "The Spirit of Amanah: Optimistic and Thrive in Sustainable Business ". Bank NTB Syariah as a financial service provider always followed the value of trust in executing regular duties and responsibilities. The bank commitment initiated the good performance in maintaining the quality of business and its progression despite of the challenging market condition in the pandemic era. This accomplishment was supported by strategic policies, e.g. achieving sustainable and quality business, optimizing retail Third Party Funds (DPK) and other source of funds, increasing financial growth and maintaining the quality of financing, developing and optimizing system infrastructure, information technology, as well as strengthening the Bank's capital from Shareholders and increasing the portion of retained earnings and reserves, implemented in the Bank during 2020. The key to the success in maintaining quality and achieving business growth in 2020 was inseparable from the support and commitment of all shareholders and stakeholders as well as Bank NTB Syariah personnel in providing the best performance, maintaining public trust and continuing to address the challenging faced by the company. Amanah as a shared value became the identity and basic characteristic of the peers in-house as stated in the Vision, Mission, Cultural Values and Behavior of Bank. In its implementation, the Amanah Value had become a guideline and motivation for the Bank in maintaining the quality and business growth in 2020 and in the future, on a sustainable manner. Bertahan di tengah badai PT Bank NTB Syariah. 2020 Annual Report 02
  4. THEME CONTINUITY 2017 Transformation For Better Future Growth West Nusa Tenggara is known with its local wisdom as Bumi Seribu Masjid (A thousand mosques land) which is in accord with the majority of its population who are Muslim; it gives its color in social life, including the desire to conduct financial activities following Islamic sharia principles. Bank NTB, as a Regional Bank whose stocks are owned by the Provincial and all City Regencies Governments in West Nusa Tenggara Province, has a high commitment to actively contribute to regional economic development. In line with the strategic decision in 2016 to transform into a Sharia Commercial Bank, Bank NTB believes that this change will provide both opportunities and challenges to develop bigger and better and make this momentum of change to strengthen its role of driving regional economic growth. 2018 Towards Sustainable Growth For Justice And Welfare The transformation into a Sharia Commercial Bank is a strategic decision that brought a fundamental change in Bank NTB Syariah activities. These changes do not only occur in legal and physical aspects, but also more principle and fundamental aspects of business management, operations, human resources, information technology, and other significant aspects. The three main pillars of sharia finance, namely justice (ádalah), balance (tawazun), and benefit (maslaha), are the main considerations for all activities of Bank NTB Syariah; with the support from all stakeholders and commitments of all Bank NTB Syariah members as the main assets to achieve a more advanced Bank NTB Syariah that grows sustainably and is beneficial to the whole just and prosperous Bumi Gora society. 2019 Stepping Forward to Building a Quality Business As a Business Entity whose shares are owned by the Provincial Government and all City and Regency Governments in West Nusa Tenggara Province, Bank NTB Syariah has a high commitment to support economic growth in West Nusa Tenggara Province. A series of efforts have been carried out on an ongoing basis to realize this commitment, including through the provision of superior and innovative Islamic financial products and services, the spread of office networks and electronic network reliability as well as the implementation of good corporate governance and risk management. The support of all Stakeholders and Shareholders, along with the commitment of all Human Resources is also crucial for the sustainable growth of the quality Bank NTB Syariah. The theme "Stepping Forward to Building a Quality Business" is chosen by Bank NTB Syariah in 2019, aligned with the objectives of Bank NTB Syariah, namely sustainable and quality business growth to encourage regional economic growth. The implemented focus strategies include optimizing retail third party fundraising (DPK), increasing quality financing growth, refining business processes to support services and facing challenges, strengthening implementation of compliance and risk management and implementing GCG, fulfilling formation and competency of Human Resources, and strengthening the Bank's capital through capital deposits and strengthening retained earnings and reserves. Changes in consumer transactional behaviors and the development of service quality at the National Bank require Bank NTB Syariah to make adjustments to improve services in all aspects ranging from business processes, ease and flexibility of requirements, the professionalism of Human Resources, office network distribution, and electronic network reliability. In addition to the aforementioned adjustments, the transformation into a Sharia Commercial Bank reinforces the desire and commitment of all Bank NTB Syariah employees to adjust the business model, transforming services to all levels of society with wider and more diverse customer segmentations. 03 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  5. ANNUAL REPORT 2019 2020 The Spirit Of Amanah Optimistic and Thrive in Sustainable Business In 2020 , the national banking industry was facing challenging market conditions due to the tragedy of the Covid-19 pandemic that hit the world. Large-scale social distancing had an impact on the decrease of economic performances in numerous sectors such as transportation, tourism and trade. Bank NTB Syariah always stayed optimistic to maintain the quality and sustainable business growth. Throughout 2020, Bank NTB Syariah had consistently made improvements to business processes and the provision of various banking products and services in line with the needs of society during the outbreak. Therefore, the commitment of Bank NTB Syariah was presented as "The Spirit of Amanah: Optimistic and Thrive in Sustainable Business ". Bank NTB Syariah as a financial service provider always followed the value of trust in executing regular duties and responsibilities. The bank commitment initiated the good performance in maintaining the quality of business and its progression despite of the challenging market condition in the pandemic era. This accomplishment was supported by strategic policies, e.g. achieving sustainable and quality business, optimizing retail Third Party Funds (DPK) and other source of funds, increasing financial growth and maintaining the quality of financing, developing and optimizing system infrastructure, information technology, as well as strengthening the Bank's capital from Shareholders and increasing the portion of retained earnings and reserves, implemented in the Bank during 2020. The key to the success in maintaining quality and achieving business growth in 2020 was inseparable from the support and commitment of all shareholders and stakeholders as well as Bank NTB Syariah personnel in providing the best performance, maintaining public trust and continuing to address the challenging faced by the company. Amanah as a shared value became the identity and basic characteristic of the peers in-house as stated in the Vision, Mission, Cultural Values and Behavior of Bank. In its implementation, the Amanah Value had become a guideline and motivation for the Bank in maintaining the quality and business growth in 2020 and in the future, on a sustainable manner. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 04
  6. TABLE OF CONTENT Theme Description 2 Board of Commissioner Pro files 78 Name and Address of Supporting Theme Continuity 3 Director Profiles 82 Offices Table of Contents 5 Executive Officer Profiles: 87 Information Available on the Website 123 Company Overview 7 - Main Directorate Sector 89 Educations and/or training of the 124 Milestones 9 - Directorate of Funds & Services 91 Board of Commissioners, the Sharia Sector Supervisory Boards, Directors, - Directorate of Finance and Flash Performances 01 93 Operations Sector 95 97 13 - Directorate of Compliance and Risk Summary of Important Financial Data: 15 Management Sector - Financial Summary Table 15 Branch Manager Profiles 99 - Financial Ratios 17 Employee Competency 103 Awards in 2020 18 Developments and Profiles: Important Events of 2020 19 - Total Employees Based on Position - Total Employees Based on Staffing Management Discussion and Analysis of Bank Performance 04 Economic Review: 131 - Global Economic Analysis 131 103 - National Economic Analysis 131 104 - West Nusa Tenggara Economic 132 Status 02 Committees, Corporate Secretary and Internal Audit Units - Directorate of Financing Flashpoint Performance of 2020 Management Reports Analysis - Total Employees Based on 104 - National General Banking Industry Education Level Analysis Sharia Supervisory Board Report 35 - Total Employees Based on Age 104 - Sharia Banking Industry Analysis Report of The Board of Commissioners 37 - Total Employees Based on Birth 105 - West Nusa Tenggara Banking Report of The Board of Directors 45 Statement of Responsibility on 52 105 - Bank NTB Syariah Position in the 106 Operational Overview: Generation Industry Analysis - Total Employees Based on Work Units the 2020 Annual Report Banking Industry - Employee Competency Developments Company Profiles 03 - Competency Development Costs 113 Structure and Composition of 114 55 Shareholders: Company Logo 56 - Information Regarding Major A Brief History of the Company 57 Business Fields 59 - Share Ownership Structure 114 - Products and Services 60 - Share Ownership of the Board of 114 60 • Financing Products 62 • Financial Services 63 114 Shareholders Commissioners and Directors - Less than 5% of Community Share 114 Ownership 2020: 144 145 - Operational Overview: 150 • Fundraising Strategic 151 • Financinf 159 • Strategi Penyaluran Pembiayaan 161 165 Structures of Company Group, 119 • Business Performance by Increase/ Company Vision, Mission, and Culture: 71 Subsidiaries, and Affiliated - Vision 71 Companies - Mission 71 Chronology of Stock Listing and Other - Company Cultures and Main 72 Securities Decrease in Business Revenues 167 - Financial performances: 165 178 • Income statement and Other Comprehensive Incomes • Cash flow statemen • Commitment and Contingency Report PT Bank NTB Syariah. 2020 Annual Report 167 Financial Performance Review: • Financial Position Report 120 145 • Fundraising 67 119 140 • Strategic Partnerships in 2020 Organizational Structures 05 137 142 • Treasuries and Services Institutions and/or Professionals 137 • Market Share 115 75 135 140 - Shareholder Identities Sharia Supervisory Board Profiles 135 • Matketing Strategic in 2020 65 Name and Address of Supporting 134 • Marketing aspects Business Area Map Behaviors 133 - Business Development Strategies in Company Identity • Savings Products 121 Spirit of Amanah, Optimistic and Growth in Sustainable Business 180 181
  7. • Income and Profit Sharing Report 182 - Business Continuity Information 230 Internal Audit Unit 346 • Source and Distributions of Zakat 187 - Bank Soundness Level (TKB) 231 Public Accountant 351 - Business prospects 231 Risk management 352 Strategies and Work Plans 233 Internal Control System 363 Compliance Function 363 Funds Report • Sources and Uses of Benevolent 187 for 2020 Funds Reports - Main Financial Ratios 188 - Abilities to Pay Debt 189 - Changes in Binding Investment Funds 189 - Allowances for impairment losses 190 Application of Anti-Money Laundering 368 Business Support Functions 05 and Prevention of Terrorist Funding Transparency of Financial and Strategic Planning 239 Non-Financial Conditions 370 Human Resources 242 Provision of Funds for Social and/or - Collectability of Bank Financing 190 Information Technology 249 Political Activities - Capital Structure and Risk 191 Networks, Branch Performances, 255 Law Cases 371 Access to Company Data Information 372 Code of Ethics 373 Gratification Policy 374 Whistleblowing System 374 Handling of Conflicts of Interest 378 Non-Halal Income and Its Usage 379 Maximum Limit of Fund Distribution 379 380 on Earning Financial Assets and Electronic Channels Management Practices: •Capital Structures 191 Administrations, Supervisions, and •Risk Management Practices 193 Rescues of Financing 223 Risk Business - Material Commitments for 264 267 Capital Investment - Invesment of Capital Goods in the 223 Good Corporate Governance last year - Target Achievements and 223 Planned Target: 06 Governance Framework 272 Buyback Share and Buyback Legal Basis for GCG Implementation 273 Obligations •Target Achievements 223 GCG Principles 273 Assessment of Good Corporate •Planned target 224 Company Values 274 Governance in 2020 •Capital Plan 224 Corporate Governance Organ 275 225 Structure - Material Information and Facts after the date of the Accountant Report - Policies, Announcement, and 218 225 276 Corporate Social Responsibilities 07 Controlling Shareholders and Major 277 Methods of Implementing CSR 389 General Meeting of Shareholders 390 Source of Funds for CSR Programs 391 281 Realization of CSR Programs 392 Board of Commissioners 293 Corporate Social Responsibility 393 Board of Directors 306 towards the Environment Organs and Committees Under the 317 Corporate Social Responsibility (GMS) (ESOP/MSOP) Sharia Supervisory Board 225 from Public Offering - Informasi Transaksi Material Yang 226 Programs CSR Programs and Management Share Ownership Program - Realization of the Use of Funds Mengandung Benturan Kepentingan Board of Commissioners: dan/atau Transaksi dengan Pihak - Secretary of the Board of 277 317 Corporate Social Responsibility - Audit Committee 318 Work Safety (K3) - Risk Monitoring Committee 323 Corporate Social Responsibility and Restructuring of Debt and Capital - Remuneration and Nomination 328 towards Social Products/Services and - Contribution to the Country 221 - Changes in Legal Regulations and 229 and It’s Impacts Implemented in 2020 230 399 Customers 331 Board of Directors: It’s Impacts on Banks - Changes in Accounting Policies Committee Organs and Committees Under the 397 Towards Employment, Health and Expansion, Divestment, Acquisition, 221 394 Towards Social and Community Commissioners Afiliasi - Information About Investment, 380 Governance Soft Structure Shareholders Dividend Payments - Employee and/or Management 370 - Corporate Secretary 331 - Committees Under the Board of 333 Financial Reports 2020 08 Directors Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 06
  8. COMPANY OVERVIEW Business Field : Sharia-based Banking Business following the Articles of Association of Bank NTB Syariah No. 5 dated August 21, 2018 Date of Establishmen : July 5, 1964 Effective Operating Date as a BUS : September 24, 2018 Legal Fundamental : Decree of the Minister of Law and Human Rightsof RI No: AHU-0017252.AH.01.02 in 2018 ratified changes in the company articles of association PT Bank NTB Syariah in the deed No. 5, the amount of authorized capital of the Bank NTB Syariah is IDR2.5 Trillion. Product and Service : • Third Party Fund Products • Financing Products • Product Services • Operational Products Authorized Capital : IDR2,5 Trillion Ownership : • West Nusa Tenggara Provincial Governments • West Nusa Tenggara Regency Governments • West Nusa Tenggara City Governments Totas Asset : IDR10,4 Trillion Networks : 1 Head Office 12 Branch Offices 23 Supporting Branch Offices 6 Cash Offices 7 Serviced Offices 203 ATMs 5 Mobile Cash Car Number of Employees : 1.265 employements Head Office Address : Jl. Pejanggik No. 30 Mataram, 83127 Website : www.bankntbsyariah.co.id Social Media : Facebook Instagram 07 PT Bank NTB Syariah. 2020 Annual Report : PT Bank NTB Syariah : @BankNTBSyariah Spirit of Amanah, Optimistic and Growth in Sustainable Business
  9. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 08
  10. MILESTONE 1964 The West Nusa Tenggara Regional Development Bank o fficially operated on July 5, 1964 in Mataram in 1963 accordance with the Decree of the Minister of Central The issuance of West Nusa Tenggara Province-Level 1 Regional 45/63/Kep/MUBS/G dated November 29, 1963. Regulation No. 6 in 1963, which initiated the establishment of Bank Affairs/ Governor of Bank Indonesia Number: the West Nusa Tenggara Regional Development Bank as a Regional Company and the capital was initially set at IDR60,000,000 (sixty million rupiahs). 1984 Adjustment 1993 of BPD (Regional Development Bank) authorized capital, as prescribed by Regulation No. 1 of 1974, Regulation No. 9 of 1979, Regulation No. 8 of 1981, to Adjustment to the Articles of Association and change in the IDR6,000,000,000 according to the Regional Regulation authorized capital of Bank BPD NTB to IDR25,000,000,000 according Number 8 of 1984 on October 20, 1984 and was approved to West Nusa Tenggara Province PERDA No. 01 of 1993 as a follow up by Minister of Home Affairs Decree Number: 584.62-546 to the issuance of Law Number: 7 of 1992. dated June 18, 1985. 1999 Changing the legal form from a Regional Company (PD) to a Limited Liability Company (PT) BPD NTB and increasing the Bank capital to IDR100,000,000,000 (one hundred billion rupiahs) following West Nusa Tenggara Provincial Regional Regulation Number 7 of 1999 dated February 15, 1999, approved in the legal paper of West Nusa Tenggara Province Number: 05 April 21, 1999, and outlined in the Deed of Establishment of a PT before the Notary Samsaimun, SH (replacing Abdullah, SH) and had been approved by the Decree of the Minister of Justice and Human Rights of the Republic of Indonesia Number C.8225.HT.01.01 Th.99 on May 5, 1999. 2005 2004 The first Sharia Branch Office operated in Selong, East The Bank had added its activities based on sharia principles Lombok Regency and received permission from Bank stipulated by Notarial Deed of Abdullah, SH., No. 24 dated Indonesia with legal Letter No. 7/ 16/DPwB2/IDwB2/Mtr October 20, 2004, and was approved by the Minister of Law dated May 9, 2005 and Human Rights of the Republic of Indonesia with Decree No. C-27471.HT.01.04. Th.2004 dated November 3, 2004. Furthermore, the Sharia Business Unit Division was officially formed. 2008 Adjustment of authorized capital to IDR250,000,000,000 (two hundred and fifty billion rupiahs) following the Resolution of the General Meeting of Shareholders (GMS) of PT Bank NTB in the Notarial Statement signed on February 5, 2008, before the Notary Fikry Said, SH., and outlined in the Deed of Amendment to Articles of Association Number: 3 dated March 3, 2008, made before the Notary Fikry Said, SH and has been approved by Decree of the Minister of Law and Human Rights of the Republic of Indonesia Number AHU-30716 AH.01.02 of 2008 dated June 6, 2008. 09 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  11. 2010 2011 Adjustment of authorized capital to IDR1 ,000,000,000,000 (one trillion rupiahs), to meet Bank Indonesia policy on the Indonesian Banking Architecture (API) regarding the Minimum Bank Establishment of PT Bank NTB’s vision and mission, Requirement (Capital Requirement), following the Decree of the Shareholders of PT. West Nusa cultural values, and 10 (ten) main behaviors on April 30, Tenggara Regional Development Bank signed on December 5, 2011, as outlined in the Deed of 2010, and the Launching of the Bank Logo, as a symbol of Amendment to Articles of Association Number:53 dated December 9, 2011. Received approval transformation to become a Bank that is Trusted, Leading, of the Minister of Law and Human Rights of the Republic of Indonesia Decree Number: and Community Pride on May 8, 2010. AHU-01707.AH.01.02 year 2012 on January 11, 2012. 2017 2016 Conversion plan of PT Bank NTB to Bank NTB Following up on the Extraordinary General Meeting of Shareholders Syariah and the change in authorized capital to (RUPS-LB) on October 31, 2016, concerning the conversion of PT Bank NTB IDR2,500,000,000,000 (two trillion five hundred Syariah, the formation of the PT Bank NTB Syariah Conversion Project billion rupiahs) following the Resolution of the PT Management Team was based on the Decree of the Directors of PT Bank Bank NTB GMS dated October 31, 2016, as outlined NTB Syariah Number: SK/01.12/64/408/2016 dated November 10, 2016, in the Deed of the Resolution of the GMS of PT Bank and PT Bank NTB Syariah's Conversion Steering Team based on the Decree NTB Number: 14 dated November 30, 2016, before of the Governor of West Nusa Tenggara No: 584-1033 2016 on December 6, a Notary and Acting Officer Abdullah SH, and was 2016. Besides, it was agreed to change the authorized capital of the Bank approved by Decree of the Minister of Law and with IDR1 Trillion to IDR2.5 Trillion. Human Rights of the Republic of Indonesia Number AHU-AH.01.03-0115452 dated January 23, 2017. 2018 The conversion of PT Bank NTB to Bank NTB Syariah is stipulated through the Regional Regulation of the Province of West Nusa Tenggara Number 08 of 2018 concerning the conversion of PT Bank NTB to Bank NTB Syariah and validated in a Decree of the Minister of Law and Human Rights of the Republic of Indonesia Number: AHU-0017252.AH. 01.02 dated August 23, 2018, and obtained an operational permit as a BUS from the Financial Services Authority Decision of the Members of the Board of Commissioners No.KEP-145/D.03/2018 dated September 4, 2018, and officially operated at all Branch Offices on September 24, 2018. 2019 2020 The Bank remained steadfast on Amanah Value as a Shared Value in order to accelerate the process of adaptation and internalization of corporate culture to achieve the vision and mission. At the end of 2020, Bank NTB Syariah put a ground breaking in the construction of the head office building located on Jalan Udayana Islamic Center on December 17th, 2020. It was attended by the Governor of NTB After the transformation to a Sharia Commercial Bank, the Bank focused on strengthening the foundation and creed by promoting the Sharia lifestyle, “Living a Blessed Life Without Usury” to promote a new lifestyle according to the guidance of Islamic law. One of implementations of the program was to organize an event called 2019 Gelegar Property Expo, the first Property Expo in NTB on April 26th to 28th , 2019. together with the Mayor of Mataram. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 10
  12. FLASH PERFORMANCE Flashpoint Performance of 2020 12 Summary of Important Financial Data : 14 - Financial Summary Table 14 - Financial Ratios 16 Awards in 2020 17 Important Events of 2020 18
  13. 01
  14. Flash Pe r f o r m a n c e FLASHPOINT PERFORMANCE OF 2020 ASSET increased by 20 .59 % CORE CAPITAL decreased by 1.03 % to Rp1,374 to Million FINANCING increased by 14.85 % to Rp10,420 million EQUITY descreased by 0.23 % to Rp1,397 million Rp6,411 million THIRD-PARTY FUNDS increased by NET PROFIT decreased by 20.27 % to 13 PT Bank NTB Syariah. 2020 Annual Report Rp130 million 8.69 % to Rp7,409 million Spirit of Amanah, Optimistic and Growth in Sustainable Business
  15. FDR NI increased to decreased to 4 .38 % from 5.51% in 2019 86.53 % from 81.89% ROE in 2019 decreased to 9.54 % from NPF GROSS improved to 1.26 % from 1.36% in 2019 12.05% in 2019 ROA decreased to 1.74 % from 2.56% in 2019 NOM decreased to 1.22 % CASA CAR decreased to 31.60 % from 35.47% in 2019 from 2.18% in 2019 decreased to 37.55 % from 48.46% in 2019 BOPO increased to The results of Self-Assessment of Bank Soundness Level (TKB) for Bank NTB 81.39 % from 76.83% in 2019 Syariah in 2020 is composite (2) Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 14
  16. Flash Pe r f o r m a n c e SUMMARY OF IMPORTANT FINANCIAL DATA FINANCIAL SUMMARY AND FINANCIAL RATIOS FINANCIAL SUMMARY TABLE Descriptions (in million Rp) 2020 2019 2018 2017 2016 ASSETS Cash Deposits And Placements In Bank Indonesia Placements In Other Banks Marketable Securities 256,245 446,411 279,215 244,873 226,507 1,010,775 1,141,962 1,342,533 2,398,610 1,784,450 200,236 37 100,037 365,320 200,080 2,365,242 1,325,000 325,000 287,170 93,768 - - 53,490 127,900 2,182,373 2,716,611 4,347,408 1,061,699 422,842 2,171,558 2,716,611 4,347,408 1,061,699 422,842 - - Reverse Repo Receivables - Murabahah Receivables - Istishna’ Receivables - - - - - Ijarah Receivables - - - - - 10,814 - - 431 910 4,228,054 2,864,765 521,107 3,352 5,715 - - - - 2,864,765 521,107 3,352 5,715 - Qard Receivables Profit Sharing Financing - Mudharabah - Musyarakah 4,228,054 - - 4,331,965 4,659,617 (43,906) (50,963) (61,907) (77,813) (51,539) 457 722 178 396 271 2,372 2,202 2,109 1,906 1,906 - Credit Given*) Allowance for Impairment Losses Net-Lease Financing Inclusion 1,409 1,892 2,340 2,822 3,305 122,273 110,022 101,393 102,290 90,403 Other Assets 94,229 81,644 79,235 87,881 82,902 Total Assets 10,419,759 8,640,305 7,038,647 8,864,392 7,649,037 22,234 Intangible Asset-Book Value Fixed Assets And Inventories-Book Value LIABILITIES, TEMPORARY SYIRKAH FUNDS, AND EQUITY LIABILITIES AND TEMPORARY SYIRKAH FUNDS 147,973 142,853 120,730 51,537 - Wadiah Giro (Deposits) 72,222 74,160 49,896 12,286 9,050 - Wadiah Savings 75,751 68,693 70,834 39,251 13,185 7,260,943 6,673,506 4,800,651 539,236 391,186 518,209 688,032 785,405 - - - Mudharabah Savings 2,115,527 2,472,348 2,320,545 387,169 263,644 - Deposits 4,627,208 3,513,126 1,694,702 152,067 127,542 Saving Deposit Funds- Non-Bank Temporary Syirkah Funds-Non-Bank - Mudharabah Giro - - - 6,599,911 4,797,996 - Giro - - - 1,197,168 1,541,798 - Savings - - - 1,765,123 1,528,783 - Deposits - - - 3,637,620 1,727,415 Third-Party Funds* Bank Indonesia Liability Other Bank Liabilities Issued Securities Received Financing Other Liabilities Total Liability And Temporary Syirkah Funds 83,302 1,346,161 - - - - 93,605 522,799 62,018 61,772 - - - 877,000 164,746 107,518 136,875 43,277 184,289 165,237 151,504 201,647 198,043 9,022,667 7,239,946 5,703,202 7,591,223 6,391,509 *) Bank oprasional dengan sistem konvensional 15 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  17. (in million Rp) Descriptions 2020 2019 2018 2017 2016 EKUITAS Paid-Up Capital Donation Capital Capital Deposit Fund Gains (Losses) Of Defined Benefit (Manfaat Pasti) Other Additional Paid-Up Capital Profit Balance - Determined Usage - Indetermined Usage Total Equity Total Liability, Temporary Syirkah Funds, And Equity 547,402 774,900 757,650 742,550 688,050 542 542 542 542 542 1,000 17,250 15,100 54,500 148,648 (75,574) (61,293) (51,442) (65,757) (45,287) 20 20 20 20 - 696,203 686,190 628,675 595,813 606,223 566,037 522,940 590,256 251,840 180,511 130,166 163,249 38,419 343,974 425,712 1,397,091 1,400,359 1,335,445 1,273,169 1,257,528 10,419,759 8,640,305 7,038,647 8,864,392 7,649,037 STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME Descriptions Income Management Of Funds 2020 2019 (in million Rp) 2018 31 Des combined 22 Sept to 31 Des* 1 Jan to 21 Sept** 2017 2016 807,524 745,014 829,683 218,554 611,129 950,507 912,724 (374,013) (302,064) (358,231) (80,388) (277,843) (397,374) (340,573) Netto Management Income - 433,511 442,950 471,452 138,166 333,286 553,133 572,151 Operational Income 121,976 221,496 142,446 94,846 47,600 69,614 48,949 43,341 43,158 23,952 8,230 15,722 16,712 17,769 75,368 173,878 111,434 86,027 25,407 30,147 10,387 Expense Of Funds - - Commission Income / Charged / Fee And Administration - Recovery Of Allowance For Impairment Losses - Other Operating Income 3,267 4,460 7,061 590 6,471 22,755 20,794 (382,109) (440,069) (393,053) (179,104) (213,949) (399,296) (319,964) (71,367) (165,655) (119,630) (83,796) (35,834) (68,106) (25,901) (155,486) (140,778) (121,147) (29,673) (91,474) (140,945) (163,038) 7,186 (7,335) (9,511) (1,695) (7,816) (8,596) (9,077) (148,070) (126,301) (142,765) (63,940) (78,825) (181,648) (121,948) 173,378 224,377 220,844 53,908 166,936 223,451 301,136 2,787 (1) (8,132) (548) (7,584) 2,676 7,129 Income Before Tax 176,166 224,376 212,712 53,360 159,352 226,127 308,265 Income Tax Expenses (46,000) (61,126) (60,808) (14,941) (45,867) (79,613) (80,013) Net Profit 130,166 163,249 151,904 38,419 113,485 146,514 228,252 Other Comprehensive Income (Expenses) (14,281) (9,851) 14,315 4,807 9,508 (20,470) (25,330) Comprehensive Profit Of The Current Year 115,885 153,398 166,219 43,226 122,993 126,044 202,922 Operational Loads - Formation Of Allowance For Impairment Losses - Empoyement Salaries - Promotional Expenses - Other Operating Expenses Operational Profit Non-Operational Income And Expenses *) Bank operates effectively with the sharia system Spirit of Amanah, Optimistic and Growth in Sustainable Business **) Bank operates with the conventional system PT Bank NTB Syariah. 2020 Annual Report 16
  18. Flash Pe r f o r m a n c e Rasio Keuangan (in million Rp) Descriptions 2020 Liabilities Provision Capital Adequacy 2018 2019 22 Sept s.d 31 Des* 1 Jan s.d 21 Sept** 2017 2016 31.60% 35.47% 35.42% 31.69% 30.87% 31.17% 0.82% 1.01% 1.27% 1.61% 1.22% 1.15% 0.84% 1.02% 1.26% 1.58% 1.19% 1.11% 0.46% 0.68% 0.98% 1.62% 1.27% 0.93% Gross NPF/NPL 1.26% 1.36% 1.63% 1.76% 1.35% 1.20% Nett NPF/NPL 0.77% 0.61% 0.57% 0.46% 0.25% 0.41% Return on Assets (ROA) 1.74% 2.56% 1.92% 2.34% 2.45% 3.95% Return on Equity (ROE) 9.54% 12.05% 8.92% 11.92% 11.82% 20.76% Net Return (NI/NIM) 4.38% 5.51% 6.61% 5.26% 6.31% 7.79% 74.66% 78.10% 68.69% Requirements (CAR) Problematics Assets productive and non-productive to total assets productive and non-productive Problematics Productive assets with total productive assets Allowance for Impairment Losses (CKPN) of Financial assets against productive assets Net Operating Margin (NOM) 1.22% 2.18% 2.20% 81.39% 76.83% 86.86% 65.95% 51.32% 10.70% 86.53% 81.89% 98.93% 80.66% 75.07% 97.66% - Percentage of Violation of BMPK 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% - Percentage of Exceeding of BMPK 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% - Minimum Statutory Reserves (GWM) (Rupiah) 4.13% 6.82% 5.00% 34.59% 8.42% 6.74% Operational Costs on Operational Revenues (BOPO) Revenue Sharing Financing on Total Financing Financing to Deposit Ratio (FDR) /LDR Compliance *) Bank operates effectively with the sharia system **) Bank operates with the conventional system Financing Asset 7,649,037 2016 2017 5,089,355 8,864,392 2018 7,038,647 2019 4,868,692 5,582,097 8,640,305 10,419,759 2020 2020 Third-Party Funds 228,252 2016 2017 146,514 2018 5,211,416 163,249 130,166 PT Bank NTB Syariah. 2020 Annual Report 2016 2017 7,190,684 151,904 2019 17 2018 2019 6,410,884 Profit 2020 2016 2017 5,397,842 4,921,381 6,816,359 7,408,917 2018 2019 2020 Spirit of Amanah, Optimistic and Growth in Sustainable Business
  19. AWARDS IN 2020 Bank NTB Syariah received an award as “The Taxpayer with Significant Contribution in 2019” held by the Directorate General of Taxes of West Nusa Tenggara (DJP Nusra) on February 12th, 2020 in Mataram. Bank NTB Syariah received an award for The Best Financial Performance in 2019 with the title of Excellent and an award in the category of Rising Star Bank in 2020 held by Info Bank magazine. The awards were broadcasted online on September 29th, 2020. Bank NTB Syariah received an award as the most efficient sharia bank of Book Bank 2 Group held by Anugerah Syariah Republika (ASR) 2020. The award was given live virtual on December, 21st 2020. Spirit of Amanah, Optimistic and Growth in Sustainable Business Bank NTB Syariah received an award in TOP BUMD Awards 2020 as the 4-star level Sharia Regional Development Bank Sector and TOP CEO BUMD 2020 on August 27th, 2020 in Jakarta. Bank NTB Syariah received an award for performance excellence and digital technology and an award for the best performance CEO 2020 in the category of Regionally-owned Enterprise (BUMD) with the Best Overall held by the Nusantara Awards 2020. The award was broadcasted online on December 7th, 2020. Bank NTB Syariah received an award as TOP Digital Implementation on Sharia Back Sector and as TOP Leader on Digital Implementation 2020 held by TOP Digital Awards 2020 on December, 22nd 2020 in Jakarta. PT Bank NTB Syariah. 2020 Annual Report 18
  20. Flash Pe r f o r m a n c e IMPORTANT EVENTS Entering its second year as a Sharia Commercial Bank , Bank NTB Syariah started 2020 with enthusiasm and optimism to support sustainable business growth. The achievements of Bank NTB Syariah after the transformation became a strong magnet for regional banks in Indonesia to visit Bank NTB Syariah. Bank Aceh Syariah became the first regional bank to make a working visit to Bank NTB Syariah on January, 8th 2020 which was represented by the Head of the IT Division, Head of the Product Division, and Head of the Planning Division. Besides strengthening the Islamic brotherhood, the purpose of the visit is for doing a comparative study on the implementation of mobile banking. The visit was welcomed by the President Director of Bank NTB Syariah who was accompanied by the JKE Division in charge of e-channel, TSI Division, and DNR Division. On that occasion, the President Director of Bank NTB Syariah along with the ranks and team of Bank Aceh Syariah held a sharing session about the implementation of mobile banking considering that the development of e-channels in this digitalization era is very much needed to provide the best service for the community. The Working Visit of Bank Aceh Syariah On January, 11th 2020, the Family of Bank NTB Syariah sent abundant blessings (salawat) together as an expression of gratitude for the achievements and business growth of Bank NTB Syariah for the 2019 financial year. In that activity, TGH. Ahmad Zainuri delivered a tausiah (an Islamic lecture) followed by a prayer led by Haddad Alwi. This activity is expected to provide positive energy in carrying out activities in 2020, following the Word of Allah Subhanahu Wa Ta'ala, "Whoever is good at being grateful will have more enjoyment". Hopefully, the growth and development of Bank NTB Syariah can provide better benefits for the people. Following the Bank's Business Plan, physical office presence is still very much needed in building trust and brand awareness in the society, especially for Islamic banking education. On January, 13th 2020, Bank NTB Syariah inaugurated the Sub-Branch 19 PT Bank NTB Syariah. 2020 Annual Report Haddad Alwi in Salawat together event Office (KCP) of Pemenang. The inauguration was attended by the Director of Funds and Services of Bank NTB Syariah, the Regional Secretary of North Lombok District, and the Branch Manager of Bank NTB Syariah of Tanjung Branch Office. The office is a relocation of the old one which was damaged by the earthquake, which is intended to reach North Lombok District area, especially Pemenang and the three gilis (small islands) so that the locals can access banking services more quickly. The Opening of KCP Pemenang Furthermore, on January, 17th 2020, Bank NTB Syariah and Himpunan Kerukunan Tani Indonesia (HKTI) NTB signed a cooperation agreement regarding the distribution of the Tunas Sejahtera iB Amanah financing facility to garlic and corn farmers assisted by HKTI NTB. The Head of the HKTI NTB said that the harvest was expected to be used as seeds to fulfill the needs of garlic in West Nusa Tenggara and other provinces so that the government does not have to import garlic anymore. On that occasion, the Regent of East Lombok appreciated the full attention given by the NTB Syariah Bank to garlic farmers, especially those in East Lombok District, in Sembalun area which is the center of garlic farming. The plan is that the number of farmers receiving financing facilities is around 1,500 farmers, they are expected to improve the economy of the Sembalun community. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  21. Bank NTB Syariah Head o ffice General Manager of JKE Division, Branch Manager of Bima, Deputy Branch Manager of Bima, and several Heads of OPD within Bima City Government, Entrepreneurs, Heads of State-owned Enterprise (BUMN), and local Public figures. The opening of the Cash Office of Raba under the Coordinator of Bank NTB Syariah Branch Bima is the 10th cash office in West Nusa Tenggara and the first cash office in Sumbawa. Hopefully, Bank NTB Syariah can grow rapidly and serve all banking transactions such as opening accounts, depositing/withdrawing, including financing services especially for the society of Bima City. The signatory partnership with HKTI NTB To improve business progress, Bank NTB Syariah does not only focus on establishing new partnerships with other parties but also continues to maintain and improve partnerships with existing parties. On January, 24th 2020, the President Director of Bank NTB Syariah and his staff received a visit from the Deputy Director of BPJS Ketenagakerjaan of Bali, Nusa Tenggara, and Papua and the Head of BPJS Ketenagakerjaan of Mataram. The visit was intended to establish friendship to strengthen the cooperation and at the same time form a synergy between the two institutions in the future. Gathering and meeting with the treasurers of Regional Technical Implementation Units (UPTD), junior high schools, senior high schools, vocational schools, The Working Visit of Deputy Director of BPJS Ketenagakerjaan of Bali, Nusa Tenggara, and Papua and the Head of BPJS Ketenagakerjaan of Mataram On February, 12nd 2020, the sub-branch office (KCP) of Tente Bima held a gathering and meeting with the treasurers of Regional Technical Implementation Units (UPTD), junior high schools, senior high schools, vocational schools, sub-district offices and, Bima District Education Service which was held at Bank NTB Sub-branch office of Tente Bima. It was attended by the branch manager of Bank NTB Syariah of Bima, Sub Branch Manager of Sub-branch office of Tente, and several Treasurers of Education sector in Parado, Monta, Woha, and Belo Districts. This activity aimed to improve service quality so that Bank NTB Syariah is equal to other national banks and proof that Bank NTB Syariah has now transformed into a modern regional bank based on Sharia principles. As the banking sector develops, Bank NTB Syariah continues to innovate and compete to have competitiveness, one of which is by opening a Cash Office of Raba located in Raba Market Complex of Rabangodu Utara Village, Raba sub-district of Bima city, on February, 10th 2020. The opening of the Service was inaugurated by the Mayor of Bima accompanied by Socialization and signing the Financing Agreement of Tunas Sejahtera iB Amanah The Opening of Raba Cash Office Spirit of Amanah, Optimistic and Growth in Sustainable Business The Socialization was continued with the signing of the Financing Agreement of Tunas Sejahtera iB Amanah. It was carried out by Bank NTB Syariah of Bima and given to 34 customers with total financing of IDR 1,680,000,000 (one billion six hundred and eighty million rupiah). It was held on PT Bank NTB Syariah. 2020 Annual Report 20
  22. Flash Pe r f o r m a n c e 12 February 2020 at Bank NTB Syariah of Bima . The program is intended specifically for Micro, Small, and Medium Enterprises (UMKM) with maximum financing of up to IDR 50 million. This financing scheme uses the periodic payment method for cattle fattening with grace installments of up to 8 months or even 1 year, while for poultry farming, the installment was paid monthly. ATM transaction services in Saudi Arabia. Customers of the bank which is a member of ATM Bersama can use this facility by simply using their ATM card with ATM Bersama logo at Al-Rahji Bank ATMs to withdraw Saudi Arabian Riyal. Bank NTB Syariah, as a member of ATM Bersama, has agreed to implement the Crossborder ATM service. Bank NTB Syariah customers who own a debit card with the GPN logo can use this facility. In addition to establishing a business, Bank NTB Syariah is also actively supporting government programs as well as empowering Bank NTB Syariah foster partners. To support Pesona Lombok Sumbawa Goes to Moto GP 2021 program, Bank NTB Syariah, represented by the Branch office of Sudirman Praya, participated in displaying handwoven (songket) products made by UMKM supported by Bank NTB Syariah at the Wonderful Event Festival Pesona Bau Nyale 2020 organized by Tourism Office of West Nusa Tenggara together with Central Lombok District Government on February, 12nd 2020. Artajasa strategic agreement with Al-Rahji Bank Malaysia Bank NTB Syariah Stand at Wonderful Event Festival Pesona Bau Nyale 2020 On the same day, Bank NTB Syariah received an Award as The Taxpayer with a Significant Contribution in 2019 at the Rinjani Hall of Regional office of Directorate General of Taxes of Nusa Tenggara, Mataram. The certificate was directly awarded by the Head of the Regional Office of the Directorate General of Taxes of Nusa Tenggara to the President Director of Bank NTB Syariah. Besides being a taxpayer, Bank NTB Syariah is also a Perception Bank for receiving tax payments. People who have tax obligations can make payments at Bank NTB Syariah. The Bank focuses on e-channel development to provide optimal service to customers resulted in the praise given by the Vice President of Indonesia during his working visit in Lombok, West Nusa Tenggara, on February, 19th 2020. One of the Vice President's agendas was to review the development of Micro, Small, and Medium Enterprises (UMKM) in Mandalika site. During the visit, the Vice President took the time to shop for several local UMKM products, one of which was at Perak Ungge owned by Farid, which is a UMKM supported by Bank NTB Syariah and uses EDC in its transactions. The Vice President said that this needs to be emulated by other UMKM as it also supports government programs to create a cashless society. By cashless payments, transactions are easier, faster, and safer. Additionally, financial management can be more efficient and accountable. The Working Visit of Indonesia Vice President to Lombok Bank NTB Syariah received an Award from DJP NuSra A week later, on February, 18th 2020, Bank NTB Syariah, represented by the General Manager of TSI Division, attended a Cooperation event of Artajasa and Al-Rahji Bank of Malaysia that agree on the convenience of Cash Withdrawals in Saudi Arabia using the ATM Bersama network. PT Artajasa, as the owner and manager of the ATM Bersama network, provides cross-border 21 PT Bank NTB Syariah. 2020 Annual Report In the same month, on February, 20th 2020, the Indonesian Farmers Association (HKTI) of West Nusa Tenggara signed a cooperation agreement with the Ministry of Agriculture of the Republic of Indonesia through the Directorate General of Facility Financing (PSP) and Agricultural Infrastructure which was attended by the Director of Compliance & MJR of Bank NTB Syariah. This cooperation aims to help distribute the People's Business Credit (KUR) program to farmers in West Nusa Tenggara. The Director of PSP Financing of the Ministry of Spirit of Amanah, Optimistic and Growth in Sustainable Business
  23. Agriculture of the Republic of Indonesia explained that this cooperation was a strategic step to succeed the government programs , especially the distribution of KUR for agriculture as much as IDR 50 trillion to all provinces in Indonesia. To date, there are 26 groups with a total member of 1,600 farmers who are under the HKTI of West Nusa Tenggara. The Head of HKTI of West Nusa Tenggara hopes that KUR can be distributed to these farmer groups, especially to verified groups. The working visit by Commission I Provincial Regional People’s Representative Councils (DPRD) Central Kalimantan and Bank Kalteng Kalimantan was welcomed by the Director of Funds & Services and Director of Finance & Operation along with the ranks of the General Manager & Desk Head. The signatory partnership with Ministry of Agriculture of the Republic of Indonesia Bank NTB Syariah continues to establish cooperation with various parties that have a positive influence on the performance and corporate image of the Bank. The various positive contributions that have been made so far have also had a positive impact. Bank Indonesia’s Regional office of West Nusa Tenggara trusts and cooperates with Bank NTB Syariah through the Branch Office of Bima to hold a socialization session about the process of making fermented feed for cattle using local ingredients in Tangga Village of Monta sub-district of Bima on February, 27th 2020. The socialization session took place at Tuta Rasa, RT. 11 RW. 04 Desa Tangga and was attended by Deputy Head of Regional Office of KPw of Bank Indonesia of West Nusa Tenggara, Functional Staff of UMKM Development of BI Mataram, Branch Manager of Bank NTB Syariah Bima and other related officials. Socialization about the process of making fermented feed for cattle using local ingredients The positive and continuous performance of Bank NTB Syariah has attracted several institutions in Indonesia to make working visits, such as the working visit by Commission I Provincial Regional People’s Representative Councils (DPRD). Central Kalimantan and Bank Kalteng visited on February, 27th 2020 where the group was led by the Deputy Chairperson of the Provincial Regional People’s Representative Councils. Central Spirit of Amanah, Optimistic and Growth in Sustainable Business Deputy Chairman of the Provincial DPRD of Central Kalimantan conveyed that the purpose of the working visit was, in addition to establishing a friendship with the Management of Bank NTB Syariah, to find out the successful transformation process of Bank NTB Syariah as well as to determine the contribution of the bank in optimizing Original Local Government Revenue (PAD) through the implementation of the e-retribution system. Bank NTB Syariah is also concerned about continuously developing its products and opening the widest network possible to increase retail funds, one of which is by holding a Gathering with Local Start-Up "DoCar" at the Rajungan Ampenan restaurant on March, 1st 2020. DoCar is a start-up engaged in motorcycle and car taxis online. Currently, the application is available on Google Play Store. The meeting was attended by the DoCar owner, General Manager of the JKE Division of Bank NTB Syariah, Branch Manager of Branch Office Karang Jangkong, and Sub Branch Manager of Sub-branch office Mataram. In that meeting, 500 drivers opened Tambora iB Amanah accounts. Then, the drivers can make transactions that are easier, faster, and more efficient using the iB Amanah Debit Card and Bank NTB Syariah mobile banking. Bank NTB Syariah Gathering with “DoCar” Start-Up NTB Syariah seriousness in providing financing to garlic farmer groups was manifested in the signing of a contract to finance the Sembalun Garlic Cultivation Program. The event took place on Thursday, March, 5th 2020 at Pendopo II of the Deputy Regent of East Lombok which was attended by the Deputy Regent of East Lombok as the Chairman of HKTI NTB, Director of PT Bank NTB Syariah. 2020 Annual Report 22
  24. Flash Pe r f o r m a n c e contract signatory to finance the Sembalun Garlic Cultivation Program Bank NTB Syariah , Head of Bank NTB Syariah Pahlawan of Selong, OPDs and representatives of garlic farmer groups to be given the financing. Bank NTB Syariah never stops providing the best services for customers and the people of West Nusa Tenggara. It was shown by, for example, holding Bank NTB Syariah Gelegar Expo 2 Property & Umrah event which is the second annual event held by Bank NTB SyariahThe activity was held for 4 days from March, 12th to 15th 2020 at the Atrium of Lombok Epicentrum Mall (LEM). The pre-approval realization of the Expo was closed at 1,006 users with a value of IDR 150.9 billion which exceeded the target. At this Expo, Bank NTB Syariah also exhibited tenants of Umrah pilgrimage trips which were attended by 5 famous Hajj & Umrah travel in West Nusa Tenggara. Hopefully, the locals can take advantage of this Expo to perform Umrah well, safely, and comfortably. To realize the dream of the locals to perform Umrah, the bank has also prepared Umrah financing. Distribution of Assistance for Residents affected by Covid-19 At Expo 2 this year, the bank also held three competitions i.e photography, tahfidz, fashion & talent show in the closing ceremony of Gelegar Expo 2, the committee announced the winners of the competition. Starting from the tahfidz competition for kindergarten (grade 1-3) and elementary (grades 4-6), fashion & talent show competition, and photography competition for general landscape, general culture & heritage, and student categories. Along with the Gelegar Expo 2 Property & Umrah, the Epicentrum Service Office was officially opened on March, 12th 2020. The opening of this service is aimed at 'weekend banking' to improve service and transaction convenience, especially for customers and visitors of Lombok Epicentrum Mall (LEM). Since the beginning of 2020, the entire world has been hit by the Covid-19 virus which was later declared a global pandemic. Responding to that condition, the bank took steps to anticipate the spread of Covid-19 in the working environment by routinely The Gekegar Property Expo 2 of Bank NTB Syariah in 2020 23 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  25. The Inaugurated of SBO Lopok Submission of Covid-19 Prevention Assistance to BPBD Kota Bima spraying disinfectants , distributing masks to employees, giving vitamins regularly, and enforcing other health protocols. Additionally, the Bank optimally contributes to helping the locals affected by Covid-19 through cooperation with the Regional Government by distributing food packages, masks, and educate the public about the application of the Covid-19 Health protocol. On Friday, May, 15th 2020, the Governor of West Nusa Tenggara launched a special loan policy for Micro, Small, and Medium Enterprises (UMKM) to arouse their enthusiasm in the outbreak by providing a special financial scheme for UMKM supported by Bank NTB Syariah. This program is in the form of installment relief and financing with a grace period of 1 year and contractor or vendor financing with a sinking fund or cash collateral. The goal is to help local governments encourage the rise of UMKM in West Nusa Tenggara so that its economy can get better, especially during the Covid-19 pandemic. This program was inaugurated on June, 6th 2020 by the Governor of NTB. Bank NTB Syariah also keeps improving its services for the society by adding sub-branch offices. On Friday, June, 5th 2020, Bank NTB Syariah Sumbawa opened a sub-branch office, namely sub-branch office Lopok. It was inaugurated by the Regent of Sumbawa, represented by the Regent's Expert Staff. It was also attended by representatives of Bank NTB Syariah. In his written remarks, the Regent of Sumbawa expressed his appreciation for the opening of the NTB Syariah Bank in Lopok sub-district. By the opening of the sub-branch, It is hoped that the bank will be able to support the community's economy considering that in this era of globalization, the people and the business communities desperately need access to financial services. The increasing number of banking institutions in the Sumbawa District will certainly encourage economic growth in the area. With the presence of Bank NTB Syariah in Lopok, the people of Lopok will have access to a wider and more diverse range of financial services. On July, 5th 2020, Bank NTB Syariah will turn 56. Bank NTB Syariah held a simple but not reducing the sense of solemnity 56th Anniversary celebration at the Head Office on Monday, 6 July 2020. This annual event entitled "Maslahat (benefit) for All" was followed by Qur’an (Yaasin) recitation and tumpeng (a specific type of rice)cutting by the Board of Directors and the Board of Commissioners. The celebration was attended by all levels of management of Bank NTB Syariah. The Launching of Special Loan Policy for MSMEs The Governor of NTB hopes that Bank NTB Syariah can contribute to succeed the trade and distribution center so that it will be easier to map people's needs. The data generated from this method will be accommodated by Gerbang NTB Emas (GNE) which will then be used as a basis or reference to succeed the trade and distribution center program. Spirit of Amanah, Optimistic and Growth in Sustainable Business In his remarks, the President Director of Bank NTB Syariah invited all employees to express their gratitude for the achievements of Bank NTB Syariah to date. With the permission and grace of Allah Subhanahu Wa Ta'ala, that year Bank NTB Syariah grown into a large Sharia Bank, continuing the struggle of the founders of the bank 56 years ago. PT Bank NTB Syariah. 2020 Annual Report 24
  26. Flash Pe r f o r m a n c e The 56th Anniversary Celebration of Bank NTB Syariah Still , on the anniversary, the Governor of West Nusa Tenggara inaugurated the Branch Office of Sriwijaya on Tuesday, July, 7th 2020. The inauguration was attended by the Board of Commissioners and Directors of Bank NTB Syariah and other guests. The Branch Office is a relocation Branch Office Karang Jangkong which was previously located in Cakranegara. The existence of the Branch Office is expected to be an effort to expand and distribute services in the city of Mataram. The Branch Office Outlet was built in a more modern and friendly look as a service to customers. Hopefully, the modernization of the office can provide a comfortable, safe office atmosphere, and enlivens informal yet productive work. To improve employees' competence and performance, the management opens opportunities for high-achieving employees to continue their formal education by providing master’s degree scholarships to selected employees to improve their competence. To realize this, Bank NTB Syariah has signed a cooperation agreement with the Postgraduate Program at Universitas Islam Negeri Mataram and the Postgraduate The Inaugurated of BO Sriwijaya 25 PT Bank NTB Syariah. 2020 Annual Report Program at Universitas Technology Sumbawa. The output expected from this scholarship program is the improvement of Bank NTB Syariah Human Resources to be more superior, broad-minded. This program is also a strategy to prepare prospective leaders who have good intellectual qualities in facing increasingly complex challenges. Furthermore, in providing maximum service to retired customers, Bank NTB Syariah inaugurated a Purnabakti Cash Office on Jalan Majapahit, the city of Mataram, on Monday, July, 7th 2020. Purnabakti Cash Office is equipped with standard health check service facilities as well as doctors and physiotherapists for retired customers who receive pension fund benefits at no additional cost. In providing these health facilities, the Bank cooperates with Universitas Mataram and Univesitas Nahdlatul Ulama University. The opening of the Purnabakti cash office is based on the retired customers' desire to get comfortable banking services and facilities. Purnabakti Cash Office is the 46th office owned by Bank NTB Syariah. Not only by retired customers, but this The Signatory agreement with UIN Spirit of Amanah, Optimistic and Growth in Sustainable Business
  27. s The Inaugurated of Purnabakti Cash Office service o ffice can also be used by other general customers. As a bank that manages regional cash and pays pension funds for civil servants, the bank is committed to keep optimizing its services to retirees who have made an extraordinary contribution to West Nusa Tenggara. Hopefully, this office, Bank NTB Syariah can provide excellent service for customers. The Covid-19 pandemic is not an obstacle for management, employees and, partners of Bank NTB Syariah to share on Eid al-Adha 1441 Hijriyah. After the transformation to sharia commercial bank, the bank routinely organizes the Tebar Qurban program. In this program, the Bank prepares sacrificial animals to be distributed to mustahik and the community around the NTB Syariah Bank Office area. The number of sacrificial animals given by the management, employees, and partners of Bank NTB Syariah increased by 50 percent in 2019 Eid Al-Fitr to 40 cattle. In 2020, Bank NTB Syariah slaughtered 64 cattle. The increase in the number of sacrificial cattle is higher than the previous year due to the increasing awareness and understanding of Bank NTB Syariah employees in sharing with the less advantaged people. Simultaneous slaughter of sacrificial cattle was carried out on Saturday, August, 1st 2020 at 11 branch offices and the head Qurban Sharing Event penanganan Covid-19. Tim Bank NTB Syariah juga Syariah juga office of Bank NTB Syariah. In addition to carrying out the slaughter independently, the cattle were also handed over to the Hubbul Wathan Islamic Center (IC) Mosque and also to shareholders (district/city governments) throughout West Nusa Tenggara. The distribution of sacrificial cattle was 10 cattle for the head office, 54 cattle were distributed to 11 branch offices, shareholders, and the Hubbul Wathan Islamic Center The committee, when handing over the cattle, still obeyed the Covid-19 health protocol. The Bank team also distributed the cattle meat to several people in the village according to the list of names submitted by each village head to the bank. After the success of Tebar Qurban program, the Bank also succeeded in realizing 1,200 subsidized housing units of the mortgage Liquidity Facility (FLPP) program in semester 1 of 2020. NTB Syariah again received an additional quota of 450 Qurban Sharing Event Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 26
  28. Flash Pe r f o r m a n c e subsidized housing units to be financed by the central government. Formally, the signing of the contract between Bank NTB Syariah and consumers of subsidized houses coincided with the commemoration of National Housing Day (Hapernas) 2020 which was broadcasted virtually and witnessed by the Minister of PUPR RI, followed by 13 FLPP partner banks for subsidized houses including Bank NTB Syariah on Tuesday, August, 25th 2020. For West Nusa Tenggara, the signing of a subsidized house financing agreement of the FLPP program was held at Santika Hotel which was attended by 160 subsidized housing customers by prioritizing health protocols. The signing was divided into three sessions namely at 14.00, 15.00, and 16.00 Central Indonesian Time. Currently, the Bank has partnerships with 28 companies for mortgage programs. This number increases compared to the previous year. There are at least 40 companies that are still on the waiting list to partner with NTB Syariah Bank. this program, it is expected that UMKM and small traders can be facilitated and brought closer to banking institutions, one of which is Bank NTB Syariah. The Governor of West Nusa Tenggara appreciated the launch of Mawar Emas which was supported by the Financial Access Acceleration Team (TPAKD) namely OJK, Bank Indonesia, Bank NTB Syariah, PNM, and the NTB Sharia Economic Community (MES). As many as 50 Mawar Emas participants received financing at the launch. Mawar Emas Program is also intended to help micro-business actors who have difficulty accessing credit or financing. Through coordination with MES NTB, Activities of Mawar Emas are centered at mosques as the center of civilization and sources of prosperity. Entering Semester II of 2020, Bank NTB Syariah has made another achievement. Bank NTB Syariah achieved the TOP BUMD Awards 2020 which was the best award in Indonesia for its achievements, improvements, and contributions. This award is proof of the consistent brilliant performance it has achieved since the beginning of 2020. Bank NTB Syariah received three awards at the same time at the event held at the Golden Ballroom of The Sultan Hotel of Jakarta on Thursday, August, 27th 2020. The three awards are TOP Pembina BUMD 2020 which was awarded to Governor of West Nusa Tenggara Dr. H. Zulkieflimansyah, TOP BUMD Awards 2020 #BPD #Bintang 4 which was awarded to Bank NTB Syariah, and TOP CEO BUMD 2020 which was awarded to President Director of Bank NTB Syariah H. Kukuh Rahardjo. Contract Signtatory between Bank NTB Syariah and consumers of subsidized houses One of the problems faced by UMKM is the lack of capital to develop their businesses and that UMKMs become easy targets for illegal financial service providers, in this case, loan sharks. The phenomenon of rampant loan sharks inspired the government to overcome the problem. On 12 August 2020, the Governor of West Nusa Tenggara launched the mosque-based program against loan sharks or abbreviated as Mawar Emas. The program was launched at Nurul Ikhsan Mosque of Keruak of East Lombok. It coincided with the UMKM National Day 2020. Mawar Emas is a Provincial Government program supported by OJK which was intended to help UMKM and small traders who borrow money from loan sharks with a high interest rate. With Bank NTB Syariah achieved the TOP BUMD Awards 2020 These awards encourage all of Bank NTB Syariah employees to work optimally, give their best, and present a variety of creative and innovative breakthroughs in providing services to all customers and stakeholders of NTB Syariah as well as improving business performance. To express their concern for the development of competence and scientific practices, Bank NTB Syariah, through the realization of the internship program, has given opportunities for every educational institution and students as academics to complete one of their final study programs of internships or Field Work Practices (PKL). For example, from July, 20th to September, 11th 2020, Bank NTB Syariah facilitated the internship program for students of Institut Agama Islam Tazkia in which several agendas different from those assigned in general internship program were added such Peluncuran Program MAWAR EMAS 27 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  29. Tazkia ’s students internship at Bank NTB Syariah as briefing, lecture on general banking, internship activities in each work unit, and internship report. This internship program was ended with students’ presentations, farewell, and delivery of certificates to the best internship program participants. The entire employees of Bank NTB Syariah held a "Fun Gowes" event on September, 26th 2020. The route was from the head office to Narmada, at the residence of H. Rachiman (President Director of Bank NTB Syariah 2008-2009). This activity is a gathering event for the entire employees of Bank NTB Syariah i.e. employees and the board of directors, general managers, branch managers, and sub-branch managers. This event strengthens the friendship of the employees and encourages employees to live a healthy life, both physically and spiritually. The fun riding activity gives additional energy for every employee of Bank NTB Syariah to work for the benefit of the people of West Nusa Tenggara. In commemoration of the 56th anniversary of Bank NTB Syariah, the Bank held Social Service and Gathering activities which were held simultaneously by the Head Office and 12 Branch Offices. This activity is an expression of gratitude for the bank is still able to give its best performance. A series of activities were arranged by branch offices and head offices based on the theme proposed in each location and region to visit. Some examples of social activities carried out were distributing staple food, giving donations to orphans and the elderly, giving aids for mosques and prayer rooms’ renovation, piping clean water, making drilled wells, doing cooperation, and planting fruit trees beneficial to the community. Social Service and gathering activities of Bank NTB Syariah were held from October, 29th to November, 1st 2020. Bank NTB Syariah Fun Gowes event Spirit of Amanah, Optimistic and Growth in Sustainable Business Bank NTB Syariah Social Service The challenge faced by Islamic banking is the low level of Islamic financial literacy and inclusion. Bank NTB Syariah continues to strive to provide education related to Islamic finance so that the people know and understand the benefits of Islamic financial products and services. Financial also provides great benefits for the financial services sector. An Islamic financial literacy program was carried out by Bank NTB Syariah together with the Anti-Riba Association (PAGARI) NTB and the Islamic Economic Community (MES) NTB on Wednesday, November, 11th 2020 at Santika Hotel of Mataram. The President Director of Bank NTB Syariah, Chairman of the Sharia Supervisory Board (DPS) of Bank NTB Syariah, and dozens of other participants along with PAGARI NTB and MES NTB attended the program. The President Director of Bank NTB Syariah said that Islamic financial literacy is important for the community and it will still be carried out to spread the information of Islamic finance in West Nusa Tenggara. In the Islamic financial literacy program with PAGARI NTB and MES NTB, the President Director of Bank NTB Syariah, along with the Head of DPS Bank NTB Syariah, accompanied by the Director of Finance, launched an assistance program of three units of water tanks in the parking lot of Hotel Santika Mataram. Two of them were given for Sumbawa and the other was given for Lombok Island. The program is proof of the Bank's commitment to assist the government and the community in dealing with the problem of clean water shortages in the West Nusa Tenggara. Similar to this program, Bank NTB Syariah held socialization and education sessions for the society regarding the advantages of hijrah (moving to be better off) by making use of the Islamic Islamic financial literacy program with PAGARI NTB and MES NTB PT Bank NTB Syariah. 2020 Annual Report 28
  30. Flash Pe r f o r m a n c e 2021 Bank NTB Syariah Bussines Review financial industry rather than conventional ones. The education and socialization is conveyed through communities, organizations, or other forums. This is one of the efforts of Bank NTB Syariah in providing Islamic financial literacy to the public. The positive impact that the bank continues to give is all in the will of Allah Subhanahu Wa Ta'ala as for His mercy and grace, every personnel of Bank NTB Syariah can give their best. As an expression of gratitude, Bank NTB Syariah routinely holds an Islamic lecture held at the Head Office. This lecture was attended by all levels of management and employees of the Bank NTB Syariah head office. The Routine Islamic lecture was held every month merely hoping for blessings of Allah Subhanahu Wa Ta'ala in running a business. This activity was followed by reading Qur’an (yasin) and tausyiah. As a reflection of the Prophet Muhammad Sallallahu 'Alaihi Wassalam's birthday commemoration, the board of commissioners of Bank NTB Syariah, in their tausyiah, reminded all employees to always follow the prophet’s commands and perform what he performed in living his daily life providing that the Prophet is the best role model. In all activities that involve a large number of people, Bank NTB Syariah complies with the health protocols following the government recommendations. Throughout 2020, all employees of Bank NTB Syariah gave their best performance for the sustainability of the Bank's business. As a reflection on the Performance, Bank NTB Syariah conducted Business Review 2020 which was held from December, 03rd to 06th 2020. Taking place in Gili Gede, West Lombok, the Business Review was done as a Muhasabah or introspection of the performance of Bank NTB Syariah throughout 2020. With no exception, the muhasabah is carried out by the trustees of Bank NTB Syariah who have contributed maximally to developing the company. This activity was also used as a socialization session regarding the Bank's strategy in running its business in the future. Trust, as the Shared Value, was also emphasized as it is the main value in carrying out daily activities in Bank NTB Syariah. All positive performance of Bank NTB Syariah is made complete with the strategic cooperation that Bank NTB Syariah established with BPJamsostek NTB to provide social security protection for vulnerable workers in NTB in the National Movement for the Protection of Vulnerable Workers (GN-Lingkaran). This program is an expression of Bank NTB Syariah's concern for the workers affected by the Covid-19 pandemic. Symbolic Handover of BPJamsostek Participant Cards to Vulnerable Workers Pengajian Rutin Bank NTB Syariah 29 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  31. Bank NTB Syariah Head Office Groundbreaking A total of 7 ,500 workers are registered into the Employment Injury Insurance (JKK) and Life Insurance (JKM) programs organized by BPJamsostek. The protection for vulnerable workers has started from October, 23rd 2020 to February, 22nd 2021 or for four months. The Deputy Governor of NTB symbolically handed over member cards to representatives of vulnerable workers. It was witnessed by the Financing Director of Bank NTB Syariah and the Head of BP Jamsostek NTB on Wednesday, December 16th 2020. The Deputy Governor of NTB expressed his appreciation and gratitude to Bank NTB Syariah and BPJamsostek for the excellent collaboration in this program. That way, more and more workers have working protection. These are the workers with the highest risk of work accidents or even death when they work. building and parking lots, a city park will also be built with the concept of education, culture, and family for the general public. While still feeling grateful for the groundbreaking, Bank NTB Syariah is again trusted to be the Distributor of Subsidized Housing (FLPP) in 2021 along with 30 other Banks. The government will grant FLPP a mortgage in 2021 with the allocation of IDR 9.1 trillion for 157,500 housing units. The budget was allocated for Implementation List Fund (DIPA) of IDR 16.62 trillion and return on investment of IDR 2.5 trillion. Taking place at the Auditorium of the Ministry of Public Works and Public Housing (PUPR) on December, 18th 2020, the 30 implementing banks signed a Cooperation Agreement (PKS) with Pusat Pengelolaan Dana Pembiayaan Perumahan (PPDPP) of the Ministry of PUPR onsite and online via Zoom Meeting. The dream of having a modern and spacious head office has now come true. A certainty that Bank NTB Syariah will own a new building with a modern concept has been determined. On the 62nd anniversary of West Nusa Tenggara Province on Thursday, December, 17th 2020, groundbreaking of the head office building was put by the Governor of NTB together with the Mayor of Mataram accompanied by the President Director of Bank NTB Syariah. The development plan for the Head Office of Bank NTB Syariah, which is located on Jalan Udayana, is located between the Islamic Center (IC) of West Nusa Tenggara and the DPRD of West Nusa Tenggara Province Office with a land area of 15,000m2. It is a five-story building with one basement on an area of 12,000m². The construction of the Bank NTB Syariah head office building is one of the efforts to improve services to the community. On this land, in addition to building an office Spirit of Amanah, Optimistic and Growth in Sustainable Business Bank NTB Syariah Head Office Groundbreaking PT Bank NTB Syariah. 2020 Annual Report 30
  32. Flash Pe r f o r m a n c e network , infrastructure, and human resources. To achieve this vision, Bank NTB Syariah offers the opportunity for the Best Millennials to build West Nusa Tenggara. They can join through a recruitment process to recruit more competent and competitive workers. The recruitment was initiated with the registration process opened from December, 7th to 20th 2020. Of all the efforts of Bank NTB Syariah throughout 2020, amid the Covid-19 pandemic when the national economic conditions continued to slow The Cooperation signatory with Ministry of Public Works and Public Housing down, Bank NTB Syariah was able to maintain its performance. This is reflected through the Bank NTB Syariah consistently provides financial literacy to appreciation given by various parties throughout 2020. Such as various levels of society, one of which is the dissemination of the awards given by various trusted institutions i.e. as a Taxpayer banking products during the Regional Conference of the with Significant Contribution in 2019 given by Directorate General Indonesian Muslim Women Entrepreneurs Association (IPEMI) of Taxes of Nusa Tenggara, ranked first with the predicate of at the Jayakarta Hotel of Mataram on Saturday, December, 19th “Very Good” in the Category of BUKU 2 Bank group with assets 2020. The event was attended by 130 UKMKs from 10 under IDR 10 trillion awarded by Info Bank Magazine, Top BUMD districts/cities. 2020 the #Bintang 4 level and the Best Performance CEO 2020 awarded to Mr. H. Kukuh Rahardjo as the President Director of On this occasion, Bank NTB Syariah introduced the Amanah POS Bank NTB Syariah, as BUMD in the category of the Best Overall for (Point of Sales) Application which is an online cashier application Performance Excellence and Digital Technology, and the Best CEO product that will be given free of charge to business actors in Performance 2020 awarded to Mr. H. Kukuh Rahardjo as NTB. This application is Bank NTB Syariah's contribution to President Director of Bank NTB Syariah by Nusantara Awards business actors in NTB so that the financial management of 2020, as Top Digital Implementation 2020 on Shariah Bank Sector UMKMs in NTB gets better and more accurate. #Bintang 3 Level and Top Leader on Digital Implementation 2020 awarded to Mr. H. Kukuh Rahardjo as President Director of Bank NTB Syariah is one of the economic drivers in West Nusa Bank NTB Syariah given by Top Digital Awards 2020, as the most Tenggara with the vision of "Becoming a Safe, Prominent and Efficient Sharia Bank for the BUKU Group 2 awarded by Anugerah Community Choice Sharia Bank". Aggressive business growth Syariah Republika 2020. demands Bank NTB Syariah to develop an organization, Bank NTB Syariah Recruitment Process The sosialization of Amanah POS 31 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  33. Inauguration of Bank NTB Syariah Water Tank Car Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 32
  34. 02
  35. MANAGEMENT REPORT Sharia Supervisory Board Report 35 Report of The Board of Commissioners 37 Report of The Directors 45 Statement of Responsibility for the Truth Contents on the PT Bank NTB Syariah 2019 Annual Report . 52
  36. M a n a g e me n t Report SHARIA SUPERVISORY BOARD REPORT ُ‫ﻋﻠَ ْﯿ ُﻜ ْﻢ َو َر ْﺣ َﻤﺔُ ﷲِ َوﺑَ َﺮ َﻛﺎﺗُﮫ‬ ‫اﻟ ﱠ‬ َ ‫ﺴﻼَ ُم‬ ‫ﺑِﺴ ِْﻢ ﱠ‬ ‫اﻟﺮ ِﺣﯿﻢ‬ ‫�ِ ﱠ‬ ‫اﻟﺮ ْﺣ ٰ َﻤ ِﻦ ﱠ‬ Shareholders and Stakeholders, who are glorified by Allah Subhanahu wa Ta’ala. Alhamdulillah and our gratitude to Allah Subhanahu wa Ta'ala who has given us guidance and mercy so that we can carry out the sharia in doing transcation (muamalah) according to the guidance of Allah and His Messenger. Sholawat and greetings for our Prophet Muhammad Shallallahu ‘alaihi wa sallam who brought the righteous teachings (religion) and guided his people (ummah) towards the right path. In accordance with PBI No. 11/33/PBI/2009 regarding the implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units and SEBI No. 12/13/DPbS, the Sharia Supervisory Board conducts supervision of Bank NTB Syariah in 2019 with the following explanation: 1. The objective of supervision is to determine the quality of the implementation of the fulfillment of Sharia Principles for the distrubution and collection of funds as well as Bank services based on the reports analysis submitted by and/or requested from the work unit; 2. Examination was carried out on 12 Branch Offices (Pejanggik Branch Office, Selong Branch Office, Praya Branch Office, Gerung Branch Office, Bima Branch Office, Sumbawa Besar Branch Office, PTC Pancor Branch Office, Sriwijaya Branch Office, Tanjung Branch Office, Dompu Branch Office, Taliwang Branch Office, and Surabaya Branch Office) and Sub-Branch Offices under the management of each Branch Office, by determining the schedule of visits to Branch Offices and Sub-Branch Offices which are double-checked, conducted before each Semester of each year based on the internal meeting of the Sharia Supervisory Board; 3. The number of sampling tests (samples) of audit transactions is determined at each 10 (ten) files for the Branch Office and each 5 (five) files for Sub-Branch Offices; H. RUBAI AHMAD MUNAWAR, Lc., M.Si Sharia Supervisory Board Chairman 35 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  37. Examination is carried out semi annually or 2 (two) times a year for each type of transaction based on the transaction documents that are tested for sampling to determine compliance with sharia aspects (sharia compliance) as required in the applicable internal Bank regulations with a focus on compliance checks, such as: a. The suitability of the contracts used in fund-raising products and bank services such as Wadi'ah, Mudharabah, Kafalah, and Ijarah (Ujrah). b. The suitability of the contracts used in fund distribution or financing products with the Murabahah, Salam, Istishna', Musyarakah Mutanaqishah (refinancing) and Musyarakah (cooperation with shared profit) contracts; c. Fulfillment of contract elements, especially in a financing scheme; d. Fulfillment of documents including Financing Decree (SKP), Financing Analysis Note (NAP), Akad, Notary Deed, Receipt or proof of transaction and other documents. 5. In addition to the examination, observations, requests for information, discussion and/or confirmation are also carried out to Bank Employees and/or Customers to strengthen the results of the examination; 6. The Sharia Supervisory Board also provides quarterly guidance to all Branch Offices and Sub-Branch Offices. The Sharia Supervisory Board provides guidance and explanations to all employees regarding the administrative and management processes that must be carried out in the Bank's operations in order to fully implement sharia and syamil principles. 7. Reviewing applicable internal provisions related to compliance with sharia aspects if there are indications of non-compliance with the implementation of Sharia Principles; 8. Providing a sharia opinion on the activities of the Bank, particularly as a requirement that must be met by Bank NTB Syariah in order to fulfill the requirements of the annual financial report audit process for Bank NTB Syariah; 9. Reporting the results of supervision to the Board of Directors, the Board of Commissioners, and the Financial Services Authority (OJK) containing documentation of DPS activities every semester, including: a. The results of supervision of the Bank's product development process include objectives, characteristics, contract in products, compliance with sharia principles and DSN-MUI Fatwa, review of systems and procedures for product distribution. b. The results of supervision of the Bank's activities include the collection and distribution of funds, as well as Bank services in the form of supervision in the form of determining and checking the number of transaction quotation tests, reviewing the Standard Operational Procedure (SOP) related to Sharia aspects. 10 In addition to monitoring the implementation of transactions, the Sharia Supervisory Board also provides opinions on Bank activities during 2020, namely 09 opinions in the First Semester and 35 opinions in the Second Semester. 11. Improve understanding of Islamic Banking practices to all Leaders and Employees at the time of conducting exit meetings by asking for information and opening dialogues, especially those related to raising funds and financing, strengthening contract materials and Sharia Banking products to find out more about matters related to operational constraints and technicalities in order to ensure compliance with sharia principles. This is intended so that all leaders and branch employees understand and re-recognize the sharia banking product and service scheme. Including the standard contracts used in funding, financing and service products so that expectations from the business side continue to grow and from the aspect of sharia compliance are also fulfilled. 4. Spirit of Amanah, Optimistic and Growth in Sustainable Business To support all of the above achievements, the Sharia Supervisory Board morally and spiritually has an obligation to convey motivation and direction to all branch leaders and all branch employees so that they always prioritize Islamic morals/ethics in carrying out all duties and responsibilities that are the mandate of the Company. This is an added value as well as a very fundamental milestone for Bank NTB Syariah. THE SHARIA SUPERVISORY BOARD COMPOSITION Bank NTB Syariah has only one Sharia Supervisory Boards consisting of a Chairperson. Following is the Sharia Supervisory Board in 2020 composition: No Name Position 1. H. Rubai Ahmad Munawar, Lc. M.Si. Chairman The Annual General Meeting of Shareholders (GMS) on April 22, 2020, it was decided that there would be a respectful dismissal of the Member of the Sharia Supervisory Board and approved the candidate for the Member of the Sharia Supervisory Board to be further processed according to the provisions and submitted to the Financial Services Authority (OJK) The Sharia Supervisory Board is committed and responsible for directing and providing guidance to Heads of Branch Offices and Sub-Branch Offices as well as all employees at PT Bank NTB Syariah to implement sharia principles in transactioning (muamalah). The aims is to ensure seriousness and adherence to sharia principles and compliance with laws and regulations by constantly reminding the management of PT Bank NTB Syariah This is the report of the Sharia Supervisory Board of PT Bank NTB Syariah in 2020. Wabillahittaufik wal Hidayah ‫ﻋﻠَ ْﯿ ُﻜ ْﻢ َو َر ْﺣ َﻤﺔُ ﷲِ َوﺑَ َﺮ َﻛﺎ ﺗُﮫ‬ ‫َو اﻟ ﱠ‬ َ ‫ﺴ َﻼ ُم‬ On behalf of the Sharia Supervisory Board H. Rubai Ahmad Munawar, Lc., M.Si Chairman PT Bank NTB Syariah. 2020 Annual Report 36
  38. M a n a g e me n t Report REPORT OF THE BOARD OF COMMISSIONERS H . ZAINAL FANANI Independent President Commisioner 37 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  39. ُ‫ﻋﻠَ ْﯿ ُﻜ ْﻢ َو َر ْﺣ َﻤﺔُ ﷲِ َوﺑَ َﺮ َﻛﺎﺗُﮫ‬ ‫اﻟ ﱠ‬ َ ‫ﺴﻼَ ُم‬ ‫ِﺑﺴ ِْﻢ ﱠ‬ ‫اﻟﺮ ِﺣﯿﻢ‬ ‫�ِ ﱠ‬ ‫اﻟﺮ ْﺣ ٰ َﻤ ِﻦ ﱠ‬ Respected Shareholders and Stakeholders, Our gratitude goes to Allah SWT for His grace and guidance poured to Bank NTB Syariah (Bank), which until 2020 has been able to go through various obstacles, especially the Covid-19 pandemic that has hit the whole world including Indonesia and West Nusa Tenggara Province and Alhamdulillah, Bank NTB Syariah is able to maintain business continuity well. 2. 3. Furthermore, please allow us as the Board of Commissioners of Bank NTB Syariah to convey the main points of the Supervisory Report on the course of the Company in the financial year ending on December 31, 2020. Several important matters related to the implementation of supervisory duties and providing advice to the Board of Directors on the course of the Company are as follows: SUPERVISION OF IMPLEMENTATION OF BANK STRATEGY The Board of Commissioners realizes that the challenges faced in 2020 are not easy. Therefore, in carrying out its supervisory and advisory duties, the Board of Commissioners is guided by the prevailing laws and regulations, the Financial Services Authority Regulations, Bank Indonesia Regulations, and the Company's Articles of Association. The duties of monitoring and providing advice, the Board of Commissioners are carried out through a meeting mechanism to discuss developing strategic issues, challenges faced, realization of the target achievement of the Bank's Business Plan (RBB) for 2020, as well as other matters that support the improvement of the Bank's performance. In 2020, the Board of Directors set a number of targets for achieving financial and non-financial performance as well as strategic policies to be pursued. These strategic policies have been approved by the Board of Commissioners. With regard to the implementation of these strategic policies by the Board of Directors, the Board of Commissioners performs the function of monitoring and providing advice independently as well as directing, monitoring and evaluating the implementation of the bank's strategic policies. The Board of Commissioners intensively directs, monitors and evaluates the implementation of these strategic policies, among others, in the following strategic policy focuses: The financing distribution strategy is to ensure that NTB 1. Syariah Bank promotes a culture of risk and compliance in quality financing expansion, particularly for the retail and commercial segment financing. In particular, the Board of Commissioners considers that expansion into the commercial segment must consider a culture of risk and compliance well, even though most commercial financing Spirit of Amanah, Optimistic and Growth in Sustainable Business 4. 5. 6. 7. 8. is aimed at financing contractors for APBD-based projects and prospective sectors with a more manageable level of risk; The strategy of collecting Third Party Retail Funds as an effort to improve liquidity stability and independence in order to reduce dependence on corporate funds so as to provide flexibility to NTB Syariah Bank in formulating a competitive pricing strategy in the distribution of financing; Strategy for developing technology and network infrastructure to support technology-based services in line with the development and modernization of the banking industry; Organizational development strategy and human resource management as the main capital in achieving and growing performance; Monitoring and evaluation of the implementation of the Bank's Business Plan; Comprehensive implementation of risk management and compliance policies; Implementation of Good Corporate Governance; Supervision and other advice on the implementation of strategic policies of the Board of Directors in carrying out banking activities. ASSESSMENT ON THE PERFORMANCE OF THE BOARD OF DIRECTORS The COVID-19 pandemic was greatly affecting the economic conditions of West Nusa Tenggara in 2020. The economy of the NTB region in 2020 grew negatively by 0.64%, this condition was due to the outbreak of COVID-19 virus in 2020 which put pressure on the global, national and even regional economies, this condition also affects the performance of the banking industry in West Nusa Tenggara (NTB). The banking challenge in West Nusa Tenggara Province is collection third-party funds. Based on data from the Financial Services Authority NTB Province, up to December 2020, the Banking Loan to Deposit Ratio (LDR) or Financing to Deposit Ratio (FDR) in NTB was 151.90%, which means that 51,9% of credit / financing was financed by third-party funds from outside NTB. This indicates that there is still a lot to finance credit and / or financing using funds from outside NTB. No exception on Bank NTB Syariah. FDR of Bank NTB Syariah, when calculated from third-party funds which sourced from West Nusa Tenggara reached 183.16%. This matter indicates the funds used to finance partial financing uses third party funds from outside West Nusa Tenggara. Third-Party Funds is generally Corporate hird-Party Funds, which usually costs more than Retail Third-Party Funds. Therefore, Bank NTB Syariah needs to seriously build ability to explore Retail Third-Party Funds in West Nusa Tenggara Province. PT Bank NTB Syariah. 2020 Annual Report 38
  40. M a n a g e me n t Report Alhamdulillah , in the midst of these challenging conditions, Bank NTB Syariah was able to record excellent business growth. In general, the performance of Bank NTB Syariah is above the average of the national Islamic banking industry. The operational and financial indicators of Bank NTB Syariah in 2020 experienced very good growth. Bank assets were recorded at Rp.10.42 trillion or grew 20.59% (yoy), Third Party Funds (DPK) collected reached Rp.7.41 trillion or grew 8.69% (yoy), Financing reached Rp.6.41 trillion or grew 14.85% (yoy). The impact of the Covid-19 pandemic which limits the movements and business activities of customers and in maintaining the quality of debtors who were affected by Covid-19 remained at a smooth quality, the Bank carried out restructuring steps. The restructuring that has been carried out by the Bank, among others, is by providing leeway for installment payments, lowering the level of margin or yield. The final result of the Bank's financial performance is the achievement of the Bank's net profit decreasing by 20.27% (yoy), reaching Rp130.17 billion (audited) against the Bank's 2019 net profit of Rp.163.25 billion. The Bank's financial performance has been audited by the Public Accountant Firm (KAP) Tanubrata Sutanto Fahmi Bambang & Partners (BDO). The KAP opinion is stated in the Independent Auditor's Report No.0096 / 2.1068 / AU.4 / 07 / 0007-2 / 1 / III / 2021 dated March 5, 2021 with the financial report Opinion presenting fairly, in all material respects or called “Fair Without Modifications ". The Bank's Financial Statements have been published in the Lombok Pos, Radar Lombok and Republika newspapers on March 29, 2021. In addition to the achievement of this financial performance, Bank NTB Syariah also received awards from various parties. In 2020 Bank NTB Syariah received the following awards: No Awards 1. Significant contribution Taxpayers in 2019 TOP Regionally Owned Enterprise (BUMD) Awards 2020 No 2. 3. 4. 5. 6. Jabatan 2019 Financial Performance - Predicate of Excellent BUMD Kategori Keseluruhan Terbaik untuk Keunggulan Kinerja dan Teknologi Digital dan Sebagai CEO Kinerja Terbaik 2020 Efficient Islamic Bank - Book Group 2 Top Digital Implementation on Shariah Back Sector and as TOP leader on Digital Awards 2020 Award-Giving Institution Nama Direktorat Jenderal Pajak (DJP) Nusra Top Business, Regional Autonomy Institute (i-OTD), Nawacita Research Institute (LKN)) Bank Info Magazine Indonesia Popular Mandiri Anugerah Syariah Republika (ASR) 2020 IT Works Magazine This shows that in general the NTB Syariah Bank has succeeded in achieving the targets set in the Bank Business Plan (RBB) for 2020 which has been approved by the Board of Commissioners and received awards for its participation in advancing the regional and national economy. This achievement shows that the Board of Directors of Bank NTB Syariah has carried out the mandate given during the year of 2020. In addition to the above points, the Board of Commissioners also pays attention to the safety of the Bank's Human 39 PT Bank NTB Syariah. 2020 Annual Report Resources, especially related to the health and safety of employees during the COVID-19 pandemic. During 2020, we assess that the Board of Directors has made various effective efforts to overcome the impact of COVID-19, particularly on the health and safety of employees both at the Head Office and all Branch Offices. As for what has been implemented, among others, the implementation of a habitual program for washing hands, wearing masks, maintaining a minimum distance of 1 meter to support employee activities while still prioritizing safety and comfort in the workplace. The bank has also implemented several policies related to limiting working hours to support the government to prevent and control the spread of COVID-19. For the Bank's performance achievements in 2020, the Board of Commissioners highly appreciates the Board of Directors and all ranks for this achievement. FREQUENCY AND METHOD OF PROVIDING ADVICE TO THE BOARD OF DIRECTORS In carrying out its functions and responsibilities, the Board of Commissioners is supported by supporting committees including the Audit Committee, the Risk Monitoring Committee, and the Remuneration and Nomination Committee. The effectiveness of the implementation of the duties and responsibilities of the Board of Commissioners is carried out either in writing or orally in formal forums such as meetings. Types of meetings held by the Board of Commissioners are as follows: 1. Meetings of the Board of Commissioners and Directors Meetings of the Board of Commissioners with the Board of Directors (Rakomdir / Radirkom), the Board of Commissioners with the Division Director (Rakomdirbid), and the Board of Commissioners Meeting with Divisions work units. These meetings are packed with the agenda of the realization of the achievement for the monthly bank business plan, the Bank's latest issues, the Bank's strategic initiatives such as the implementation of risk management, compliance, internal control, and especially the monitoring of the bank's rating (TKB). 2. Committees Meetings Meetings held by the Committees (Audit Committee, Risk Monitoring Committee, and Remuneration and Nomination Committee) in accordance with their respective duties and responsibilities to support the Board of Commissioners in carrying out supervision and providing advice to the Board of Directors. Throughout 2020, these meetings were held 35 (thirty five) times or more than 100% compared to the obligation to hold meetings and attendance levels of the Board of Commissioners as referred to in PBI Number 11/33 / PBI / 2009 concerning the Implementation of Good Corporate Governance for Sharia Commercial Bank. The intensity of the Board of Commissioners meetings is part of building a system in realizing the governance process with an agenda for meeting discussions, including periodic evaluations of the realization of the 2020 RBB target, discussions related to developing issues, challenges faced, strategies, action plans taken, and so forth. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  41. OUTLOOK ON THE BANK 'S BUSINESS PROSPECTS Economic conditions are a factor that greatly affects the Company's business activities. Therefore, economic conditions are one of the bases for our consideration in assessing the performance of the Board of Directors. The global economy is under enormous pressure due to the COVID-19 pandemic that has hit more than 200 countries in the world. In the World Economic Outlook January 2021 report, the IMF estimates that the global economy in 2020 will contract by 3.5%. The significant weakening of global economic activity is influenced by the Lockdown policy or the Large-Scale Social Restrictions policy and other terms which are essentially limiting the mobility of the people to reduce the spread of the virus which has resulted in a sudden cessation of economic activity in various countries. Global economic conditions have had a major impact on the Indonesian economy. The Indonesian economy experienced a recession for the first time since the monetary crisis in 1998. In 2020, the Indonesian economy recorded a contraction of negative 2.07% (YoY). In addition to global and national economic conditions, the COVID-19 pandemic has also had a significant impact on overall banking performance, in line with weak domestic demand and banking prudence. This is indicated by the relatively low demand for credit so that credit growth is in line with fund growth and the increasing trend of Loan at Risk (LaR) during 2020. Until December 2020, bank credit growth has grown by 9.75% (YoY) while growth in deposits has grown by 9.19% (YoY). It is hoped that in the future the function of banking inter-identification will begin to recover in line with the Government's program in the framework of the National Economic Recovery. Meanwhile, the economic condition of West Nusa Tenggara (NTB) Province in 2020 contracted negatively by 0.64% (yoy), decreasing from 2019 which grew positively by 3.85% (yoy). On the expenditure side, all components experienced either contraction or slowdown in growth, except for the component for foreign exports. Overall, for 2021 it is estimated that the NTB economy will grow higher than in 2020, in line with the increase in economic activity in line with expectations of a gradual vaccination process. Household consumption is predicted to increase in line with the recovery in purchasing power and improvement in conditions of employment. Government consumption is also expected to increase in line with the increase in the budget ceiling for 2021. Seeing the strong financial and non-financial conditions of Bank NTB Syariah, we stand in the opinion that the business strategy prepared by the Board of Directors is correct. In the preparation of a quantitative business plan, projections for the Bank's financial statements for 2021-2023 are aimed at solid financial performance while maintaining the growth of the Bank's business as well as maintaining the quality of financing and maintaining a healthy liquidity and capital position. banking industry. This is based on the projected growth of financing in 2021 in the range of 10.38%. Meanwhile, the growth in deposits is projected in 2021 to be around 10.56%. In accordance with the principles of prudence and the Bank's Vision and Mission, Bank NTB Syariah continues to take various strategic steps in maintaining financing growth through selective and prudent financing in sectors that still have positive prospects. Alhamdulillah, Bank NTB Syariah has built collaborations with several strategic partners consisting of Telecommunication Companies, Public and Private Universities in NTB, Regional Companies in NTB, Hajj and Umrah Travel Agencies, Hospitals, Banking, Building Material Suppliers, Insurance Companies, Online Transportation Services. In addition, as an effort to develop partnerships to increase financing, Bank NTB Syariah in 2020 has also made a strategic partnership with the Center for Housing Financing Fund Management (PPDPP) of the Ministry of Public Works for the distribution of FLPP KPR financing for low-income people, Collaboration with the Ministry of Public Works of Indonesia regarding down payment subsidies for FLPP KPR customers, and cooperation agreements with FLPP housing developers / developers related to the distribution of Subsidized KPRs. These business collaborations support the achievement of business targets in 2020 and the coming years. The support and commitment of all Bank Shareholders is going very well. The invitation of shareholders to all stakeholders to play an active role in conducting financial transactions at Bank NTB Syariah received a positive response and is one of the important triggers for the growth of Bank NTB Syariah performance. With the improving of economic conditions in 2021, it is a good hope for Bank NTB Syariah to reach a wider market with a spirit of optimism while still providing the best for shareholders and all other stakeholders. VIEW ON BANK SOUNDNESS LEVEL Bank soundness is assessed based on OJK Regulation N0.8/POJK.03/2014 concerning the Rating of the Soundness of Islamic Commercial Banks and Sharia Business Units using a risk approach (Risk-Based Bank Rating). Assessment of the Soundness of Islamic Commercial Banks is carried out with a coverage of the following 4 (four) factors: 1. Risk Profile 2. Good Corporate Governance (GCG) 3. Rentability 4. Capital. Alhamdulillah, Bank NTB Syariah is always able to maintain the soundness level of the bank at composite rating 2 which means the bank is in a HEALTHY condition. This reflects the condition of the Bank which is generally healthy so that it is considered capable of facing significant negative effects from changes in business conditions and other external factors. The detailed assessment of bank soundness is listed in the table below. We are confident that the Board of Directors will be able to make good use of the various opportunities that exist in the Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 40
  42. M a n a g e me n t Report Factor Risk Pro file Good Corporate Governance Rentability Capital Composite Value RISK MANAGEMENT Ratings 2020 2 2 2 2 2 2019 2 2 2 2 2 VIEW ON THE IMPLEMENTATION OF GOOD CORPORATE GOVERNANCE (GCG) Law No. 21 of 2008 concerning Sharia Banking and Bank Indonesia Regulation Number 11/33 / PBI / 2009 concerning the Implementation of GCG for Sharia Commercial Banks and Sharia Business Units mandates that the Board of Commissioners carries out its duties and responsibilities professionally and independently by conducting supervision, providing advice to the Board of Directors, as well as convincing PT Bank NTB Syariah to implement Good Corporate Governance (GCG) at all levels and levels of the organization. As one of the company's organs, the Board of Commissioners is directly responsible to the General Meeting of Shareholders (GMS). The responsibility of the Board of Commissioners to the GMS is a manifestation of the supervisory accountability for the management of the company in the context of implementing the principles of GCG, in accordance with the work guidelines and rules which are continuously evaluated and updated regularly. The application of Good Corporate Governance principles is expected to be able to support the face of business competition, increase the effectiveness and efficiency in the management of human resources so that it has implications for increasing corporate value. The commitment of all levels of management and employees in implementing GCG principles in the implementation of their respective duties and functions will determine the success of implementing Sustainable Governance. Bank NTB Syariah periodically conducts self-assessment of the implementation of GCG in accordance with Bank Indonesia Regulation Number 11/33 / PBI / 2009 concerning Implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units and Financial Services Authority Circular Letter Number 10 / SEOJK. 03/2014 concerning the Rating of Soundness of Sharia Commercial Banks and Sharia Business Units. The implementation of GCG principles in Bank NTB Syariah has generally gone well with a composite rating of 2. In carrying out its supervisory function, the Board of Commissioners not only focuses on the results that have been achieved but also monitors the process to achieve the expected results. Good corporate governance practices are an integral part of the efforts to achieve the goals of Bank NTB Syariah. 41 PT Bank NTB Syariah. 2020 Annual Report The Bank always strives to improve effective risk management through the implementation of risk management in accordance with POJK Number 65 / POJK.03 / 2016 concerning Application of Risk Management for Sharia Commercial Banks and Sharia Business Units. The Board of Commissioners is of the view that the implementation of risk management is good enough. The Bank's risk management has been carried out in a proactive and integrated manner to manage risk according to risk appetite and risk tolerance in order to maintain the availability of capital, support business strategies and maintain the bank's reputation. Risk management is implemented through four pillars of risk management implementation as follows: 1. Active supervision by the Board of Directors and Commissioners. The risk management organization consists of the Board of Commissioners who performs the risk oversight function assisted by the Risk Monitoring Committee (KPR) and the Board of Directors who carry out risk policy and strategy functions assisted by the Risk Management Committee. 2. Adequacy of Policies, Procedures, and Determination of Limits. The Bank has Risk Management Policies and Standard Risk Management Procedures as well as Determination of Limits as the main guidelines for the implementation of risk management, which are the basis for business and operational policies and procedures. 3. Adequacy of the Identification, Measurement, Monitoring and Risk Control Processes, as well as the Risk Management Information System. The Bank carries out the process of identification, measurement, monitoring, risk control, and risk management information system with a risk management approach through operational and capital activities. The Bank implements Enterprise Risk Management using a two-pronged approach, to ensure that risks are not only properly mitigated through daily business processes, but also in unexpected conditions (downturn) through capital reserves. The adequacy of the risk control system, the Bank implements an effective risk management application process that must be equipped with a reliable risk management information system. To ensure the adequacy of the risk control system, the Bank conducts regular reviews of risk-appetite and risk-tolerance by both the Risk Management Unit and the Internal Audit Work Unit. 4. Internal Control System. The Bank implements effective risk management practices in all Work Units by implementing the Three lines of defense model policy, namely the Business Unit (risk owner), the Risk Management Unit and Compliance Work Unit, and the Internal Audit Unit. The implementation of the internal control system for the Risk Management function is a shared responsibility for both the first, second and third line of defense. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  43. COMPLIANCE RISK 1 . In line with developments in information technology, globalization, and financial market integration, the Bank's business activities continue to experience changes and increases, and the complexity of their activities is getting higher. This has resulted in greater challenges and risk exposures faced, so that efforts are needed to mitigate these risks, both preventive (ex-ante) in order to reduce or minimize the potential risks of the Bank's business activities that are predicted to occur and those that are curative (ex-post). Therefore, it is necessary to increase the role and function of compliance by the Compliance Unit in managing compliance risk 2. Good and timely compliance risk management is expected to minimize the impact of risk as early as possible, in accordance with POJK Number 46/POJK.03/2017 concerning Implementation of the Compliance Function of Commercial Banks. Thus, the role and function of compliance by the Compliance Work Unit and all levels of the organization will not only see an event that is preventive (ex-ante) in the future but also be able to manage compliance risk so that it is in line with the ongoing implementation of risk management. 3. 4. 5. 6. In order to carry out the compliance function, the Director of Compliance through the Compliance and Risk Management Division has carried out activities through reviews, opinions and / or input to the Board of Commissioners, Directors, and related work units. During 2020 the compliance function has submitted a number of inputs including compliance culture strategies, monitoring of Bank commitments, compliance and legal analysis, which are then periodically reported to the Financial Services Authority as the implementation of POJK Number 46 / POJK.03 / 2017. OPERATIONAL RISK To prevent cases of irregularities in bank operations, especially fraud that can harm customers or banks as regulated in POJK Number 39 / POJK.03 / 2019 concerning Implementation of Anti-Fraud Strategies for Commercial Banks, it is necessary to increase the effectiveness of internal control as efforts to minimize the risk of fraud include implementing an anti-fraud strategy. The organizational system that is responsible for implementing the anti-fraud strategy at PT Bank NTB Syariah, namely the Internal Control Unit Division. In implementing the Anti-Fraud Strategy, Bank NTB Syariah has several policies related to Fraud Prevention, including internal control policies, Employee Discipline Regulations, Code of Conduct, Business Ethics and have been reflected in the Corporate Culture Values. Culture) to instill value integrity from every level of Bank NTB Syariah. The Board of Directors has periodically reported the realization of the anti-fraud program as well as the progress of improvements that have been made, We are of the opinion that the internal control system for the anti-fraud strategy that has been implemented has been effective, supported by the adequacy of the organization, internal regulations, and tools to detect any indications of fraud, including the Whistleblowing System. Spirit of Amanah, Optimistic and Growth in Sustainable Business Obligation to comply with internal and external regulations; Prohibition on all levels of the Bank from requesting or receiving, agreeing to receive a gift or reward from a third party who obtains or seeks to obtain facilities from the Company in the form of a "cash loan and non cash loan" credit facility, or in the context of purchasing or discounting letters. - money orders, promissory notes, checks and trading papers or other evidence of obligations, or other facilities related to the operations of the Company or those relating to the procurement of goods and services from the Company; Prohibition against all employees of the Bank from abusing their authority and taking advantage, either directly or indirectly, from the knowledge obtained from the Company's business activities for personal gain, benefits for family members or benefits for other parties; All levels of the Bank must make an annual disclosure that contains all circumstances or situations that may lead to violations / non-compliance with this code of conduct. All levels of the Bank can provide input to improve performance, strengthen good corporate governance and prevent fraud. Imposing sanctions ranging from mild to severe sanctions for violators of the prohibition; BThe Bank has a reporting and handling mechanism in the event of an indication of a violation within the Bank. This reporting can be done by any Bank personnel and by other stakeholders. The function of receiving a violation report will be to submit the report along with data and facts obtained from the reporter to the Board of Commissioners without disclosing the identity of the reporter if the reported party is the Board of Directors. In addition, the Board of Commissioners evaluates the violation report whether further investigation is needed or if a sentence is sufficient. In connection with a fraud incident at one of the Bank's branch offices, the Board of Commissioners has provided advice to the Board of Directors, namely: 1. Encourage the Board of Directors to create and implement an anti-fraud culture and concern for all levels of the Company's organization; 2. Conduct regular monitoring of the implementation of the Anti-Fraud Strategy and the improvements that have been made; 3. Encourage the Board of Directors to take decisive action against perpetrators of fraud; and 4. Evaluating the implementation of anti-fraud strategies on a regular basis. With operational risks (fraud) and compliance risk still occurring in 2020, the Board of Commissioners has paid attention to control over operational risk and compliance risk, and the Board of Directors has responded with concrete steps by strengthening the Quality of Risk Management Implementation for these two types of risk. PT Bank NTB Syariah. 2020 Annual Report 42
  44. M a n a g e me n t Report IMPLEMENTATION OF THE CODE OF ETHICS The application of the Code of Ethics in the management of the company becomes a standard of behavior that is reasonable , appropriate and trustworthy for all employees of Bank NTB Syariah in carrying out business activities including interacting with stakeholders. The implementation of the guidelines for the code of ethics for Bank NTB Syariah is carried out continuously in the form of attitudes, actions, commitments, and provisions to support the creation of a corporate culture and this Bank NTB Syariah Code of Ethics applies to all employees of Bank NTB Syariah at all levels of the organization. INTERNAL CONTROL SYSTEM The Internal Control System is a supervisory mechanism established by the management of the Bank, which aims to keep and save the assets of the Bank, ensure the availability of more accurate reports, increase compliance with applicable regulations, reduce financial impact or the impact of losses, fraud, violations of prudential aspects. caution, and to improve organizational effectiveness, and improve cost efficiency. The implementation of the Internal Control System at Bank NTB Syariah refers to the Regulation of the Financial Services Authority of the Republic of Indonesia Number 1 / POJK.03 / 2019 concerning the Implementation of the Internal Audit Function in Commercial Banks on January 29, 2019. Each Implementation Report and Principles of Internal Audit Results of the SPI Bank Division NTB Syariah which is reported regularly to the Representative of the West Nusa Tenggara Province Financial Services Authority (OJK) as well as the Performance Review Report of the Bank NTB Syariah Internal Audit Work Unit whose evaluation is carried out at least once every 3 (three) years by a competent external party. ASSESSMENT OF THE PERFORMANCE OF THE BOARD OF COMMISSIONERS COMMITTEE In carrying out its functions and responsibilities, the Board of Commissioners is supported by supporting committees including the Audit Committee, the Risk Monitoring Committee, and the Remuneration and Nomination Committee. The effectiveness of the implementation of the duties and responsibilities of the Committees in supporting the duties and responsibilities of the Board of Commissioners is carried out in writing in formal forums such as meetings. Meetings of the Audit Committee, Risk Monitoring Committee, Remuneration and Nomination Committee have produced useful reviews in supporting the supervisory and advisory function of the Board of Commissioners to the Board of Directors. The Board of Commissioners considers that the three Committees of the Board of Commissioners have carried out their functions and duties properly. CHANGES IN THE COMPOSITION OF THE BOARD OF COMMISSIONERS In connection with the above, the composition of the Board of Commissioners until the GMS for the 2020 financial year was opened, there was no change in the composition of the Board of Commissioners. The current number of members of the Board of Commissioners is 3 (three), with the following composition: No Position No Jabatan 1. Independent President Commissioner 2. 3. Name H. Zainal Fanani Non Independent H. Muhammad Nur Commissioner Independent Commissioner H. Muslihun The implementation of the audit function has been carried out quite adequately with a risk-based approach in each unit, in accordance with the principles of the Bank's Internal Audit Function Implementation Standards. The Board of Commissioners believes that the Board of Directors has fulfilled its commitment to follow-up on the results of internal examinations by the Internal and External Supervisory Unit Divisions such as OJK and BPK. In general, the follow-up has been in accordance with the stipulated time and the desired substance of the findings. 43 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  45. O APPRECIATION OF THE BOARD OF COMMISSIONERS ur deep appreciation and gratitude goes to Shareholders and Stakeholders for their trust and support so far for Bank NTB Syariah . We also give high appreciation to all levels of the Board of Directors, employees, and Business Partners who participate and support Bank NTB Syariah to continue to grow and develop. Wabillahittaufik wal Hidayah ‫َو اﻟ ﱠﺴ َﻼ ُم َﻋﻠَ ْﯿ ُﻜ ْﻢ َو َر ْﺣ َﻤﺔُ ﷲِ َوﺑَ َﺮ َﻛﺎ ﺗُﮫ‬ On behalf of the Board of Commissioners H. Zainal Fanani Independent President Commissioner Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 44
  46. M a n a g e me n t Report REPORT OF THE DIRECTORS H . KUKUH RAHARDJO President Director 45 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  47. ُ‫ﻋﻠَ ْﯿ ُﻜ ْﻢ َو َر ْﺣ َﻤﺔُ ﷲِ َوﺑَ َﺮ َﻛﺎﺗُﮫ‬ ‫اﻟ ﱠ‬ َ ‫ﺴﻼَ ُم‬ ‫ِﺑﺴ ِْﻢ ﱠ‬ ‫اﻟﺮ ِﺣﯿﻢ‬ ‫�ِ ﱠ‬ ‫اﻟﺮ ْﺣ ٰ َﻤ ِﻦ ﱠ‬ Praise be to our gratitude, we always pray for the presence of Allah Subhanahu wa Ta'ala for the abundance of mercy, grace, and guidance to all employees of Bank NTB Syariah during 2020, we still maintain business progress excellently. Prayers and greetings are always poured out of the Prophet, who is the leader and helper, the noble Prophet Muhammad Shalallahu Alaihi Wa Sallam. To the respected Shareholders and Stakeholders Alhamdulillah, this year, 2020 is the second year for Bank NTB Syariah to be a fully fledge sharia operated bank after its conversion to be a Sharia Commercial Bank (SCB). The transformation of NTB Bank into Bank NTB Syariah has earned strong support from the shareholders and major Muslim population in West Nusa Tenggara. Here, Bank NTB Syariah exists to complete the needs for implementing "Shariah lifestyle, Blessing Life Without Interest", a lifestyle following the guidance of Islamic law. The Bank NTB Syariah's business progress did not run smoothly like expected in the Bank's Business Plan. 2020 was a year full of challenges due to a slowdown in the macroeconomic as the result of the Covid-19 pandemic outbreak. This severe condition encouraged the government to implement Physical Distancing which restricts national and regional society mobilization. However, it did not discourage Bank NTB Syariah to provide maximum performance to benefit the stakeholders. Therefore, we are the Directors Board to report our core program for the financial year ending on 31 December 2020 as follows: THE ECONOMIC CONDITIONS AND SHARIA BANKING INDUSTRY IN 2020 In 2020, the World Health Organization (WHO) announced that the Covid-19 was a pandemic. This was not only public health but a crisis for all life sectors. Almost all countries in the world experience negative economic growth. In the World Economic Outlook report for January 2021, the IMF estimated that global economic growth in 2020 contracted by 3.5%. The global economic conditions also impacted the Indonesian economy as well. The government designated the Covid-19 pandemic as a National Non-Natural Disaster which caused the slowdown of the Indonesian economy. In 2020, Indonesia's economic growth contracted by 2.07% (YoY). Moreover, the Government stipulated a large-scale social restriction (LSSR) and physical distancing policy limited the community mobilization, resulting in a weakening of the economic activity. Spirit of Amanah, Optimistic and Growth in Sustainable Business Since then, the government has tried to provide various economic stimuli to boost Indonesia's economic growth. Throughout 2020, Bank Indonesia (BI) has issued a policy by lowering the BI 7-day repo rate by 8 (eight times) from 6.00% to 4.00%. Supporting the policy, the Financial Services Authority (FSA) issued the policy to encourage the banking intermediation function optimization, maintain financial system stability, and support economic growth by issuing POJK No. 11 / POJK.03 / 2020 concerning National Economic Stimulus as a Countercyclical Policy on the Impact of Corona Virus Disease Spread in 2019. Moreover, the Financial Services Authority (OJK) has recorded a growth in Sharia banking financing of 8.1% (YoY) at the end of December 2020, it was much higher than the growth of national banking financing contracted by -2.40%. Meanwhile, third-party funds collected by the sharia banking industry had been growing by 11.86% (YoY) to IDR. 465,977 billion, it was higher than the growth in national banking deposits of 11.11%. Total assets of Sharia banking by the end of December 2020 have grown by 13.23%, greater than the growth of national banking assets of 7.18% By 2020, Bank NTB Syariah has been experiencing the same growth. It was recorded that Bank NTB Syariah Financing at 14.85%, higher than the regional banking credit of 12.59%, and contracted national banking. Furthermore, the Third-Party Funds Collection grew by 8.69% to IDR. 7,409 billion, it was higher than the regional banking growth of 7.24%. If we compare, Bank NTB Syariah total asset has grown significantly at 20.59%, higher than the national banking at 7.18% and the National Sharia banking at 13.23%. CHALLENGES The Covid-19 virus pandemic outbreak brought risk and new challenges to disturb economic activity in all countries in the world, including Indonesia. The spread of the Covid-19 virus was very fast from one person to another at a close distance. The implementation of physical distancing and large-scale social restrictions to reduce direct contact must be done. Work from home (WFH) was introduced, it gradually affected the activities of workers/employees. Besides, the increasing case of Covid-19 has had a direct or indirect impact on the performance and capacity of the business sector. Society opted to prioritize their need for staple food and medication rather than the other secondary needs. This contributed to a decrease in banking industry performance as intermediary institutions. PT Bank NTB Syariah. 2020 Annual Report 46
  48. M a n a g e me n t Report Bank NTB Syariah as one of the Sharia Commercial Banks in Indonesia and a Regional Development Bank had a role to maintain financial stability and encourage regional economic growth. For this reason, it was expected that the role of Bank NTB Syariah should be optimized under the current condition, especially in West Nusa Tenggara. There were several challenges that we faced, first; handling financial service for customer who was directly affected by the pandemic, second; making a new selective distribution expansion for financing while improving prudential banking principles, and third; optimizing the role of digital banking for the convenient transaction. Bank NTB Syariah still optimistic that we could run the business well. In the future, we will increase our performance so that Bank NTB Syariah will perform better, especially in facing challenges that can be turned into an opportunity to be advanced and well-developed as a highly competitive regional bank. Moreover, the other classical issue that occurred in Sharia banking was the limited knowledge of Sharia finance literation and inclusion. Thus, to minimize this issue, it was required that Sharia Bank performing more socialization and education related to the products and services of Sharia finance. One form of literacy and education program that had been done by Bank NTB Syariah was giving public lectures and public discussion about the understanding of Sharia banking products and services. This activity was presented directly by the directors’ board and the sharia supervisory board. Besides, another important challenge was the minimum core capital fulfillment of the Bank of 3 trillion. According to POJK number 12 / POJK.03 / 2020 concerning the consolidation of Commercial Banks, Regional Government-owned Banks (RGB) per their capital ability fulfillment of Local Governments must fulfill the minimum core capital no later than December 31st, 2024. In this case, Bank NTB Syariah has prepared a plan/strategy to fulfill the requirement by making intense coordination with shareholders and It had been decided in the GMS on April 22, 2020. THE POLICIES AND STRATEGIES In this uncertain condition, Bank NTB Syariah remained optimistic to embrace the challenges and turned them into opportunities. It had created several adjustments to its implemented strategy following the slowing down of the economy and business. 1. 2. 3. 4. 5. 6. 7. A sustainable business growth that could contribute to regional economic growth was supported by strengthening the internal resistance; Enhancing the capability and professionalism of Human Resources and revitalizing of the organizational structure based on the stipulation of the Bank's business; Improving the implementation quality of Good Corporate Governance (GCG), internal supervision, and the Bank health improvement using Risk-Based Bank Rating (RBBR) in all bank business sectors with a healthy risk appetite and risk profile; Developing various products and programs as well as sharia banking service management which met the need of society; Developing and improving an integrated information technology system to increase digital services and support access to Bank information; Strengthening the Bank's capital under the Stake Holders concerning fulfilling the core capital to comply with the POJK Number: 12 / POJK.03 / 2020 dated 17 March 2020 concerning Commercial Bank Consolidation which regulated the minimum core capital for Regional Government Owned Banks of IDR 3 trillion; Increasing social and environmental awareness to support sustainable finance. Furthermore, these policy implementations had been done by establishing strategic partnerships with government and private institutions/agencies, developing existing products to expand market share, making improvements to Standard Operating Procedures (SOPs) and provisions to mitigate risks, increasing products socialization and promotion to enter the market, etc. HUMAN RESOURCES DEVELOPMENT We believe that the fundamental asset for one’s development and growth was its people, thus, Bank NTB Syariah committed to improve and develop the quality of human resources to meet the need of the customer. Bank NTB Syariah had implementing strategic directions in providing excellent services for its customer. Currently, the number of employees of Bank NTB Syariah is 1,265 people. This number has increased compared to the previous year which was 1,157 people. Not only the employee’s quantity that is improved but also the quality, capabilities, and skills that have been improved throughout education and training. Bank NTB Syariah Employees Number based on their education level: 653 714 441 466 Furthermore, with the improvement of the Indonesian Economy as well as Sharia banking, Bank NTB Syariah optimized to maintain its positive performance and seized the existed opportunities to continue growing and developing. Based on the NTB Sharia Business Plan, the policies and strategies focused in 2020 were as follows: 47 PT Bank NTB Syariah. 2020 Annual Report 1 1 Doctor 19 27 Master 43 Bachelor 2019 2020 57 Diploma ES-SHS Spirit of Amanah, Optimistic and Growth in Sustainable Business
  49. Bank NTB Syariah was consistently holding employee competency development through training programs for both internally (In House Training) and externally by collaborating with other parties (Public Training). The training and competency development programs that had been held during 2020 were divided through in-house training and public training with the following details: a. There were 31 activities with 1,314 participants for In-house training in 2020. b. There were 107 activities with 1,342 participants for public training in 2020. INFORMATION TECHNOLOGY The government required people to reduce their activities outside their homes. This encourages Bank NTB Syariah to continue developing a digital banking system to provide convenient and comfortable transactions. This was in line with the Bank's mission to provide excellent service and innovative sharia banking to meet the needs of society. Information Technology (IT) is the key to improve innovative service quality stated in the company mission to expand the service access and transactions coverage by optimizing the technology. In 2020, Bank NTB Syariah focused on developing Electronic Banking, Digital Banking, increasing the effectiveness and efficiency of business processes, and implementing technology following IT Blueprint that mainly focused on its business development needs. To reach this goal, it had increased the number of ATM and EDC Merchant terminals in strategic places, adding payment and purchase features at ATMs, Mobile Banking and SMS Banking increasing marketing and utilization of Corporate Cash Management System services, developing delivery channel services as well as developing Mobile Banking products that were integrated with the QRIS payment system. Moreover, facing the digital industry 4.0 era, Bank NTB Syariah strengthens the information technology infrastructure by increasing the availability and reliability of the system and transforming from traditional servers to cloud computing technology, virtualization, and increasing system security to maintain data confidentiality and customer protection. It was expected to meet the needs of digital-based customer transaction services while strengthening the position of Bank NTB Syariah as a Regional Bank that applies modern technology. Bank NTB Syariah received the TOP Digital Awards 2020 as the TOP Digital Implementation on Shariah Bank Sector from IT Works magazine. It was an appreciation for the bank's commitment to breakthroughs in technology-based services. OFFICE NETWORK DEVELOPMENT KWe realized that the physical office presence was always required to build trust and brand awareness among larger society. Also, the Bank awarded that branch offices function as the contact point in creating relationships with the customers, increasing sharia financial literacy and inclusion, as well as meeting the public's need for large cash transactions. By December 31st, 2020, Bank NTB Syariah had 1 Head Office, Spirit of Amanah, Optimistic and Growth in Sustainable Business 48 Office Networks consisting of branch offices, sub-branch offices, service offices, and cash offices spread throughout West Nusa Tenggara and Surabaya regions. The Bank also had 5 Mobile Cash Car Units to facilitate services access. PRODUCTS AND SERVICES According to the Association Articles of PT Bank NTB Syariah, especially in article 3 paragraph 1, that the Bank in conducting it's business and operation must be following the Islamic Sharia Principles. Bank NTB Syariah’s business is categorized into 3 (three), namely Fundraising, Financing Distribution, and Financial Services. Bank NTB Syariah offers diverse products especially for raising funds. The products are iB Amanah Giro, for savings we have Tambora iB Amanah, Taharah iB Amanah, Simpeda iB Amanah, Simpel iB Amanah, Tabunganku iB Amanah, and iB Amanah Deposit. We make it a priority to develop products and services based on "Customer Focus", mainly providing products that the customer needs. In 2020, the Bank has diversified its superior products, namely Tambora iB Amanah into 3 segments. They are Tambora Rencana iB Amanah intended for customers to plan for the future, Tambora Bisnis iB Amanah intended for Entrepreneurs or Individuals in managing business financial transactions, and Tambora Prestise iB intended for individuals in managing specific business financial transactions. Meanwhile, for financing products the Bank provides competitive products including consumer financing such as Bale (Housing) iB Amanah, Kendaraan (Vehicle) iB Amanah, Multipurpose iB Amanah, Sejahtera iB Amanah, FLPP iB Amanah, Cash Collateral Financing. Also, productive financing consists of Tunas Sejahtera iB Amanah, IB Amanah Working Capital, iB Amanah Investment, and iB Amanah Syndication. Furthermore, the Bank Financial Services includes Transfer (Money Transfer), Bank Guarantee, Bank Support Certificate, and Bank Reference. BANK NTB SYARIAH PERFORMANCE IN 2020 In 2020, Bank NTB Syariah faced challenging conditions. However, Alhamdulillah with various strategic implementation, we could deliver an excellent performance. It could be seen by the increase of our total assets to IDR.10,420 billion. It grew by 20.59% (YoY) if it was compared to the previous year of IDR. 8,640 billion supported by the accumulation of Third Party Funds which increased to IDR.7,409 billion, growing by 8.69% (YoY). It was also higher compared to the previous year about IDR 6,816 billion. The increasing asset was supported by the deposit growth by 31.71% or IDR1,114 billion. The average profit-sharing ratio given to customers was similar to the equivalent rate of 4.75% during 2020. PT Bank NTB Syariah. 2020 Annual Report 48
  50. M a n a g e me n t Report Moreover , financing also showed an increase to Rp6,411 billion, growing by 14.85% (YoY) if it was compared to the previous year's amount of IDR. 5,582 billion. The Financing increase was dominated by Consumptive Financing of 90.39% from the total financing portfolio to IDR.5,795 billion, meanwhile productive financing with a proportion of 9.61% from the total financing portfolio became IDR. 616 billion. The Financing quality had positive development, it was better, indicated with the NPF ratio indicator at 1.26% (improved) compared to the previous year at 1.36%. Meanwhile, the average margin or profit-sharing received by the Bank from the total financing distributed during 2020 was equivalent to the equivalent rate of 10.29%. The capital adequacy ratio (Capital Adequacy Ratio, abbreviated as CAR) at the end of 2020 was 31.60%, lower than 2019 at 35.47%. The Financing to Deposit Ratio (FDR) was 86.53% higher than the 2019 FDR of 81.89%, indicating an expansion of financing distribution. Returning on Asset (ROA) of 1.74% indicated that the Bank managed its assets properly to generate profits, as well as the achievement of Return on Equity (ROE) in 2020 about 9.54% which indicated that banks were effective in managing capital to generate profitable income. Net Income (NI) in 2020 was 4.38% lower than the NI in 2019 which was 5.51%. The BOPO ratio in 2020 reached 81.39% or 3.48% higher than the BOPO in 2019 of 76.83%. Alhamdulillah, in 2020 Bank NTB Syariah had successfully recorded a net profit of IDR 130 billion. It was lower than the previous year's net profit. It was caused by the tax obligation that should be paid by the Bank. Bank NTB Syariah was committed to settle its tax. Thus, no wonder Bank NTB Syariah has received an award from Nusra TDG as a Taxpayer with Significant Contribution in 2019. Also, the Bank provided stimuli to customers, such as free administration fees for financing and so on. COMPARISON OF TARGET AND ITS REALIZATION Generally, the target set and achieved by Bank NTB Syariah was good even better. On December 31st, 2020, it managed to achieve IDR.130 billion net profit that exceeded the target of IDR. 127 billion at 102.29%. This achievement occurred because of the financing distribution of IDR.6,411 billion which succeeded in exceeding the target of Rp6,100 billion at 105.10%. The Bank's assets reached IDR.10,420 billion, exceeding the target at 112.95%- and Third-Party Funds (TPF) reached Rp7,409 billion at 119.80%. 49 PT Bank NTB Syariah. 2020 Annual Report MSME FINANCING DISTRIBUTION Up to December 2020, Bank NTB Syariah NTB Syariah had distributed financing for MSME with the total IDR 464,478 million or 113.83%, which was higher than the target of IDR 408,063 million, with the composition of MSME financing toward the total financing of 7.25%. BUSINESS PROSPECT ANALYSIS According to the KSSK Press Release (01 February 2021), the financial stability system was well improved up to the fourth quarter which was a positive impact on the loosening of LSSR, global economic improvement, and the response of mix national policy application. In 2021, the Indonesian Economic condition is predicted to keep on improving due to progress in handling the Covid-19 issue, including vaccinations, global economic recovery, as well as stimulus and policy strengthening. In 2021 West Nusa Tenggara economy is projected to grow by 3% - 4% with the support sectors of GRDP such as, agriculture, mining, trade, construction, government administration, defense, and social security, which potential for the Bank to distribute working capital and financing investment that supports the regional economy. If we look at it from the demand side, household consumption determines the future of economic growth, thus a high opportunity can be provided by the distribution of consumer financing in WNT. Indonesian Sharia Banking industry shows positive developments amid the Covid-19 pandemic. Until December 2020, sharia banking assets, financing distribution, and third-party funds (TPF) were growing. The assets grew by 13.23%, which was higher than the national banking growth which was 7.18%. Moreover, Financing Distribution grew by 8.10%, compared to national banking credit distribution which was contracted by 2.41%, and TPF grew by 11.86%. This exemplified that the concept of profit-sharing as a principle of sharia banking business could mitigate the impact of the Covid-19 pandemic. In West Nusa Tenggara itself, the growth of sharia banking is as good as the national sharia banking growth. The market asset share grew by 23.98%, financing grew by 15.37%, and TPF grew by 11.89%. The market share position of Bank NTB Syariah is good if it is compared to the other sharia banking institution in WNT. Market share for assets reached 61.60% with asset growth of 21.05% to IDR10,459 billion, market share for financing reached 66.19% with a growth of 14.85% to IDR6,411 billion, and market share for TPF reached 79, 91% with a growth of 8.70% to IDR.7,409 billion. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  51. GOVERNANCE IMPLEMENTATION Bank NTB Syariah realizes that the consistent implementation of the Corporate Governance principles will strengthen the competitive position , improve the performance and increase the trust of Shareholders and other Stakeholders. Corporate Governance is an administrative mechanism regulating the relationship between Shareholders, Commissioners Board, Sharia Supervisory Board, Directors, Management, and other interested parties in the company. Therefore, Bank NTB Syariah is committed to creating effective GCG principles as a reference at all levels and levels of the organization by following the guidelines issued by the National Committee for Governance Policy (NCGP), namely transparency, accountability, responsibility, independence, and fairness. Furthermore, Bank NTB Syariah has implemented a good Corporate Governance system. Therefore, the management can be responsible for its financial accountability, transparency, and behavior following the ethics code to stakeholders through business strategies and important decisions that were taken. The General Meeting of Shareholders (GMS) as the highest organ in Corporate Governance appoints the Commissioners Board to monitor the implementation of the Directors Board’s duties in managing the Bank NTB Syariah. The implementation of Corporate Governance principles in 2020 was progress and refinement from the previous years, for the three aspects of governance, namely governance structure, governance process, and governance outcome. Improving the quality of Corporate Governance sustainably, Bank NTB Syariah always measured the implementation of Corporate Governance as a form of commitment to FSA Circular Letter No.10 / SEOJK.03 / 2014 concerning the Health Level of Sharia Commercial Banks and Sharia Business Units. Moreover, ensuring the application of the Corporate Governance principles, Bank NTB Syariah routinely performed self-assessment on the implementation of the three aspects of Corporate Governance on a semi-annual basis which focuses on 11 (eleven) main points of Corporate Governance principles, as follows: 1. The implementation of duties and responsibilities of the Commissioners Board; 2. The implementation of duties and responsibilities of the Directors Board; 3. The completeness and implementation of Committee duties; 4. The implementation of duties and responsibilities of the Sharia Supervisory Board; 5. The implementation of sharia principles in raising funds, channeling funds, and providing services; 6. Handling the conflicts of interest; 7. The implementation of compliance function; 8. The implementation of the internal audit function; 9. The implementation of the external audit function; 10. The Maximum Fund Distribution Limit (MFDL); and 11. The financial and non-financial transparency conditions, the implementation of Corporate Governance report and internal report. Spirit of Amanah, Optimistic and Growth in Sustainable Business In 2020, Bank NTB Syariah had achieved the optimum results of the Corporate Governance implementation. The Bank had submitted the results of the self-assessment of GCG implementation to FSA for 2020 which refers to Bank Indonesia Regulation Number: 11/33 / PBI / 2009 dated 7 December 2009 concerning Implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units, with a rating Composite 2 (two) or categorized as “Good". IMPLEMENTATION OF SOCIAL RESPONSIBILITY CORPORATE Corporate social responsibility (CSR) is a series of activities and programs performed by companies to give benefit to society as a form of community service. Bank NTB Syariah CSR program is aligned with the company's goals and implemented in a directed, structured and sustainable manner supporting the company's reputation as well as increasing the company's performance. Bank NTB Syariah CSR program concerns with helping and empowering society to gain prosperity. Through a sustainable CSR program implementation, Bank NTB Syariah expects to improve regional welfare, achieve joint business success per Bank NTB Syariah's mission to provide maximum contribution to shareholders, as well as increase the role of WNT people. In the future, Bank NTB Syariah will maximize its efforts by increasing its role and contribution to improving prosperity through CSR. Annually, Bank NTB Syariah budgets its CSR Program based on the Constitution Number 40-year 2007 to run the CSR program which aligned with the local government program such as; 1. Social, community, arts, culture, health, religion, education, sports, social welfare, and disaster care and response, 2. Community economic empowerment and development sector; 3. Environmental preservation 4. Other social activities. DIRECTORS BOARD COMPOSITION According to Financial book 2019, the Annual General Meeting of Shareholders (GMS) which was on April 22nd, 2020 has respectively dismissed H. Saharuddin and H. Ferry Satrio from their current director position to be replaced by Muhamad Usman. Therefore, by the 31st December 2020, the Bank NTB Syariah Directors Board compositions as follows: No Name Position 1. H. Kukuh Rahardjo President Director 2. Hj. Bq. Dien Rosana J. Finance and Operational Director 3. Muhamad Usman Financing Director PT Bank NTB Syariah. 2020 Annual Report 50
  52. M a n a g e me n t Report DIRECTORS BOARD OWNERSHIP , COMMISSIONERS BOARD, AND SHAREHOLDERS Also, we express our gratitude and appreciation to the Commissioner Board, and Sharia Supervisory Board for their beneficial suggestions thus, we can achieve our mission in 2020. Bank NTB Syariah share is owned entirely by the provincial, regency, and municipality governments of West Nusa Tenggara. All the management board and the employees of Bank NTB Syariah don’t have any ownership of the share as to which the share isn’t offered to the public. Bank NTB Syariah is not a public company. CLOSING We give the highest appreciation to all the Shareholders, Customer, Working Partners, and Stakeholders, for their trust and cooperation that has been well established. Moreover, we appreciate the trust, commitment, hard work, and cooperation from all Executive Officers and Employees, who were resilient, reliable, and integrating teamwork to face global and regional challenges to meet the Bank objectives. Finally, this is the end of the Directors Board report of NTB Sharia Management Performance in 2020. We are committed to giving the best contribution for the improvement of Bank NTB Syariah to be a Safe and the first Society choice for banking products and services. Hopefully, our 2020 achievement will be increased and improved in the future. Aamiiin Yaa Mujibas Saaii'lin. Wabillahittaufik wal Hidayah ‫ﻋﻠَ ْﯿ ُﻜ ْﻢ َو َر ْﺣ َﻤﺔُ ﷲِ َوﺑَ َﺮ َﻛﺎ ﺗُﮫ‬ ‫َو اﻟ ﱠ‬ َ ‫ﺴ َﻼ ُم‬ On Behalf of Board of Directors H. Kukuh Rahardjo, MP, CWM 51 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  53. STATEMENT OF RESPONSIBILITY ON THE 2020 ANNUAL REPORT This Annual Report , including corporate governance reports, financial reports, and other related information is the responsibility of the Management of Bank NTB Syariah and has been approved by all members of the Board of Commissioners and Directors through the signature of each of the following: The Board of Directors Muhamad Usman H. Kukuh Rahardjo Hj. Baiq Dien Rosana Juwita The Director of Financing President Director The Director of Finance and Operations The Board of Commissioners H. Muhammad Nur H. Zainal Fanani Non-Independent Commissioner Independent President Commissioner Spirit of Amanah, Optimistic and Growth in Sustainable Business H. Muslihun Independent Commissioner PT Bank NTB Syariah. 2020 Annual Report 52
  54. COMPANY PROFILES Company Identity 55 Company Logo 56 A Brief History of the Company 57 Business Fields 59 - Products and Services 60 Business Area Maps 65 Organizational Structures 67 Company Vision , Mission, and Culture 71 Sharia Supervisory Board Profiles 75 Board of Commissioners Profiles 78 Directors Profiles 82 Executive Officers Profiles 87 Branch Manager Profiles 99 Profiles and Competency Developments of Employees 103 Structure and Composition of Shareholders 114 Structure Group of company, Subsidiaries, and Affiliated Company 119 Chronology of Stock Listing and Other Securities 119 Name and Address of Supporting Institutions and/or Professionals 120 Name and Address of Branch Offices 121 Information Available on the Website 123 Educations and/or training for the Board of Commissioners, Sharia Supervisory 124 Board, Directors, Committees, Corporate Secretary and Internal Audit
  55. 03
  56. Company P ro fi l e s COMPANY IDENTITY Company Name Nickname Business Line PT Bank NTB Syariah Bank NTB Syariah Sharia Banking Company Status Date of Establishment Limited Liability Company July 5th, 1964 Operational Effective Date as BUS September 24th, 2018 Legal Basis of Establishment a) West Nusa Tenggara Province Regulation Number 06 of 1963 concerning the Establishment of the West Nusa Tenggara Regional Development Bank; b) The change in legal form from a Regional Company to a West Nusa Tenggara Regional Development Bank (PT Bank NTB) Limited Company through Deed of Establishment of a Limited Liability Company Number 22 dated 30 April 1999 which was ratified through the Decree of the Minister of Justice of the Republic of Indonesia Number C-8225.HT.01.01. TH.99 May 5, 1999; c) West Nusa Tenggara Province Regulation Number 08 of 2018 concerning the Minister of Law and Human Rights of the of the changes in Articles of conversion of PT Bank NTB to Bank NTB Syariah and ratified in a Decree of the Republic of Indonesia Number: AHU-0017252.AH.01.02. year 2018 regarding the Approval Association of PT Bank Pembangunan Daerah Nusa Tenggara Barat dated August 23, 2018; d) Decisions Members of the Board of Commissionaires Authority Services Finance Number. KEP-145/D.03/2018 on Granting Permit Changes Activity Bank's Business General Conventional become General Sharia Bank dated September 4, 2018. Authorized Capital Ownership IDR2.500.000.000 Trillion West Nusa Tenggara (Province/Regency/City) Regional Governance • NTB Province • East Lombok Regency • Sumbawa Regency • Central Lombok Regency • Dompu Regency : 43.13% : 9.71% : 9.63% : 7.74% : 7.48% • West Sumbawa Regency • Bima Regency • North Lombok Regency • West Lombok Regency • Mataram City • Bima City Capital Issued and Paid in Full • NTB Province • East Lombok Regency • Sumbawa Regency • Central Lombok Regency • Dompu Regency • West Sumbawa Regency • Bima Regency • North Lombok Regency • West Lombok Regency • Mataram City • Bima City : IDR : IDR : IDR : IDR : IDR : IDR : IDR : IDR : IDR : IDR : IDR Contact Address Corporate Secretary e-mail : sekper.bankntb@gmail.com Access Website Social Media • Facebook • Instagram : www.bankntbsyariah.co.id 334,216,060,000 75,230,830,000 74,650,170,000 59,999,980,000 57,967,600,000 39,643,280,000 37,918,260,000 32,021,570,000 26,087,290,000 27,097,130,000 10,067,610,000 10.067.622.290,- : 5.12% : 4.89% : 4.13% : 3.37% : 3.50% : 1.30% 1 12 23 6 7 5 Bank Code Number of Employee 128 In 2020 there were 1,265 employees unit units units units units units Head Office Address Jalan Pejanggik No. 30 Mataram – 83126 Phone: (0370)636331, 632177, 635332, 632745, 622103, 646739, (0370) 623526, 623527, 648766 Company Secretary Febrianto Budi Cahyono Phone : 0370 (636331) Fax : 0370 (622415) e-mail : sekper.bankntbsyariah@gmail.com Website www.bankntbsyariah.co.id Call Center : PT Bank NTB Syariah : bankntbsyariah Bank NTB Syariah Call 1500-667 ATM Networks ATM Bank NTB Syariah 55 Office Network Headoffice Branch Offices Supporting Branch Offices Cash Office Serviced Offices Mobile Cash Cars PT Bank NTB Syariah. 2020 Annual Report : 203 Units Spirit of Amanah, Optimistic and Growth in Sustainable Business
  57. COMPANY LOGO Bank NTB Syariah 's identity consists of symbols, letters, and colors. In simple terms, each item can be explained, as follows: Makna Umum The overall visual of the logo is dominated by a tick mark with two meanings, namely "as a sign of choice" and "a sign of something right" so that the philosophical meaning is a "right choice". Warna The “Green” color symbolizes Islamic values which serve as the main guidelines in carrying out business activities, and represents the desire to continue to grow and develop. The “Gold” color represents an energy that create harmony and balance of relationship for mutual prosperity. The “Blue” color symbolizes a dynamic movement, towards a better direction, based on trust, clean, safe and organized with the support of good Information Technology. Thus, the overall meaning of the Bank NTB Syariah logo is "a right choice following Islamic values that prioritizes the harmony and balance of a relationship; supported by trust, reliable information technology, clean, safe and orderly management within a framework of change, growth, a better movement to achieve mutual prosperity ". Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 56
  58. Company P ro fi l e s A BRIEF HISTORY OF THE COMPANY 57 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  59. Bank NTB Syariah , first established as BPD NTB, is a BUMD whose shares are owned by the Provincial Government of West Nusa Tenggara together with the Municipal Governments of the West Nusa Tenggara Province aiming to managing regional finances, helping and encouraging economic growth, and equitable development in the West Nusa Tenggara Region. The initiation of the establishment was based on Regional Regulation No. 6 of 1963 under the name West Nusa Tenggara Regional Development Bank (hereinafter referred to as BPD NTB) in the form of a Regional Company (PD) with the initial capital of IDR60,000,000 (sixty million rupiahs) and officially operated on July 5, 1964, as conventional banking. Along with the development of business and changes in regulations on BUMD regarding banking, BPD NTB took several strategic steps to increase participation in regional economic development, strengthen competitiveness, expand the Bank business territory and services to customers and anticipate national and global economic developments, including: 1. Adjustment of authorized capital to IDR6,000,000,000 (six billion rupiah) in accordance with Regional Regulation Number 8 of 1984 on October 20, 1984 and has been approved by Decree of the Minister of Home Affairs Number: 584.62-546 on June 18, 1985; 2. Adjustment of the status of the Regional Development Bank to a Regional Company in accordance with West Nusa Tenggara Province Regional Regulations (PERDA) No. 01 of 1993 as a follow up to the issuance of Law Number: 7 of 1992; 3. Changing the legal form from a PD to a Limited Liability Company (PT) BPD NTB and increasing the Bank capital to IDR100,000,000,000 (one hundred billion rupiahs) following West Nusa Tenggara Provincial PERDA Number 7 of 1999 dated February 15, 1999, ratified in the legal document sheets of the Province of West Nusa Tenggara Number: 05 dated April 21, 1999, and outlined in the Deed of Establishment of a Limited Liability Company in the presence of Notary Samsaimun, SH replacing Abdullah, SH and having been approved by Decree of the Minister of Justice and Human Rights of the Republic of Indonesia Number C. 8225.HT.01.01 Th.99 on May 5, 1999; 4. Addition of Bank business activities based on sharia principles as outlined in Notarial Deed of Abdullah, S.H., No. 24 dated October 20, 2004 and endorsed by the Minister of Law and Human Rights of the Republic of Indonesia with Decree No. C-27471.HT.01.04. TH.2004 dated November 3, 2004. Furthermore, on May 9, 2005, the license for opening the first Sharia Branch Office located in Selong City, East Lombok Regency by Bank Indonesia through Approval Letter No. 7/16/DPwB2/IDwB2/Mtr; Spirit of Amanah, Optimistic and Growth in Sustainable Business 5. Adjustment of authorized capital to IDR250,000,000,000 (two hundred and fifty billion rupiah) in accordance with the Decree of RUPS PT Bank NTB in Notary of Decision Statement of PT Bank NTB Shareholder signed on February 5, 2008 before the Notary Fikry Said, SH., and stated in the Deed of Amendment to Articles of Association Number: 3 dated March 3, 2008 and made before the Notary Fikry Said SH and has been approved by Decree of the Minister of Law and Human Rights of the Republic of Indonesia Number AHU-30716 AH.01.02 of 2008 June 6, 2008; 6. Adjustment of authorized capital to IDR1,000,000,000,000 (one trillion rupiahs), to meet Bank Indonesia's policy on the Indonesian Banking Architecture (API) regarding the Bank Minimum Requirements (Capital Requirement) until 2010, according to the Decree Shareholders of PT. Bank Pembangunan Daerah Nusa Tenggara Barat signed on December 5, 2011, as outlined in the Deed of Amendment to Articles of Association Number: 53 dated December 9, 2011. Received approval of the Minister of Law and Human Rights of the Republic of Indonesia Decree Number: AHU-01707.AH.01.02 2012 on January 11, 2012; 7. The plan to convert PT Bank NTB into Bank NTB Syariah and change the authorized capital to IDR2,500,000,000,000 (two trillion five hundred billion rupiah) in accordance with the Decree of RUPS PT Bank NTB dated October 31, 2016 as outlined in the Deed of Decision Statement RUPS PT Bank NTB Number: 14 dated 30 November 2016 before a Notary and official certifier, Abdullah SH, and was approved by Decree of the Minister of Law and Human Rights of the Republic of Indonesia Number AHU-AH.01.03-0115452 dated January 23, 2017 8. The conversion of PT Bank NTB to Bank NTB Syariah is stipulated through the Regional Regulation of West Nusa Tenggara Province Number 08 of 2018 concerning the conversion of PT Bank NTB to Bank NTB Syariah and is validated in a Decree of the Minister of Law and Human Rights of the Republic of Indonesia Number: AHU-0017252. AH.01.02 on August 23, 2018 and obtained an operational license as a Sharia Commercial Bank from the Financial Services Authority Decision of Members of the Board of Commissioners Number.KEP-145/D.03/2018 on September 4, 2018 and officially operated at all Branch Offices on the 24th September 2018. PT Bank NTB Syariah. 2020 Annual Report 58
  60. Company P ro fi l e s BUSINESS FIELDS In accordance with the Company's Articles of Association, Bank NTB Syariah conducts business activities in the banking sector. Based on the prevailing laws and regulations, the fields of business activities include: 1. Collecting funds in the form of Demand Deposits, Savings, Deposits or other equivalent forms based on wadiah, mudharabah or other contracts in line with Sharia Principles; 2. Distribute profit-sharing financing based on the sale and purchase agreement (murabahah), cooperation (mudharabah, musyarakah), leasing or providing services (ijarah), bailout (qardh), debt takeover or transfer of obligations (hawalah) or other contracts in line with Sharia Principles; 3. Providing banking services including the issuance of bank guarantees (kafalah), Bank Certificates, remittances (for own or customer interests) or other services following Sharia Principles; 4. Conducting debit and/or financing card business based on Sharia Principles; 5. Carrying out bank activities or products based on Sharia Principles using electronic facilities; 6. Purchasing securities based on Sharia Principles issued by Bank Indonesia and/or the Government; 7. Conducting activities in the capital market as long as it does not conflict with the Sharia principles and the provisions of the legislation in the Capital Market sector; 8. Issuance, offer and trade short-term securities based on Sharia Principles, both directly and indirectly through the financial market; 9. Issuance, offer and trade long-term securities based on Sharia Principles, both directly and indirectly through the financial market; 10. Acting as the founder and administrator of the Pension Fund based on Sharia Principles; 11. Conducting other activities that are commonly carried out in the banking sector as long as they are in line with Sharia principles and under statutory provisions. 59 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  61. PRODUCT AND SERVICES Along with the rapid development of the banking industry in Indonesia and intense competition , Bank NTB Syariah is committed to continuing to innovate and adapt to changes so as to provide solutions for customers in conducting banking transactions in accordance with Sharia principles. Bank NTB Syariah's business activities are categorized into 3 (three), namely savings products, financing products and service products with the following explanation: SAVINGS PRODUCTS Giro iB Amanah A deposit in Indonesian Rupiah using a mudharabah or wadiah contract. This savings product can be used by Individual Customers and Business Entities. Withdrawal of deposits can be made at any time by using check, bilyet giro or other equivalent means of payment orders, and is supported by the interconnection of banking transactions through the Cash Management System application to support the convenience and comfort of the Customer while still prioritizing security in every transaction. This savings product is equipped with a Debit Card with support for the GPN network or ATM Bersama and the flexibility of transactions through the Bank NTB Syariah’s Mobile Banking application (especially for individual customers). Tambora iB Amanah A deposit in Indonesian Rupiah using a mudharabah or wadiah contract. This savings product can be used by individual customers or business entities. This product is equipped with a Debit Card (only for Individual Customers) with the support of the GPN network for free withdrawals at more than 200 Bank NTB Syariah ATMs or all ATM Bersama with applicable withdrawal fees. This savings product is supported by interconnection and flexibility of banking transactions through the Bank NTB Syariah Mobile Banking application to support the convenience and comfort of customers while still prioritizing security in each transaction. There have been some segmentations added to Tambora iB Amanah namely: Tambora Rencana iB Amanah Tambora Bisnis iB Amanah Tambora Prestise iB Amanah A savings product intended for individuals as a means of investment to help realize customers desires to plan their future such as their children's education, religious trips, health, old age preparation, etc. with a varied investment period; A savings product intended for Individual Entrepreneurs or Legal Entities. It provides more complete facilities and services to support the management of business financial transactions. A savings intended for individuals who need more comprehensive management of business financial transactions, facilities and services. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 60
  62. Company P ro fi l e s Taharah iB Amanah A deposit in Indonesian Rupiah using wadiah and mudharabah contracts. This savings product is specifically designed to provide convenience in planning and depositing money for Hajj or Umrah pilgrimage. It provides auto debit services through other savings accounts as affiliates. Simpeda iB Amanah A deposit in Indonesian Rupiah using a mudharabah or wadiah contract. This savings product is a collaborative product of the Indonesian Regional Development Banks (BPDSI). This savings product is also equipped with a Debit Card (only for Individual Customers) with the support of the GPN network for free withdrawals at more than 200 Bank NTB Syariah ATMs or all ATM Bersama with applicable withdrawal fees. This savings product is supported by interconnection and flexibility of banking transactions through the bank’s Mobile Banking application to provide convenience and comfort for customers while still prioritizing security in every transaction. SimPel iB Amanah A deposit in Indonesian Rupiah using a mudharabah or wadiah contract. This savings product is a product of an alliance between Commercial Bank and the Financial Services Authority aimed at educating and encouraging a culture and interest in saving from an early age for students under 17, it calls for easy and simple requirements and was supported by appealing programs. TabunganKu iB Amanah A deposit in Indonesian Rupiah using a mudharabah or wadiah contract. This savings product is a product of an alliance between Commercial Bank and Bank Indonesia aimed at supporting transactions and investment of funds for the productive circles, Micro Small and Medium Enterprises (UMKM) and creative groups which calls for easy and simple requirements. This deposit product is also provided with a Debit Card with the support of the GPN network for free withdrawals at more than 200 Bank NTB Syariah ATMs or all ATM Bersama with applicable withdrawal fees. This savings product is supported by interconnection and flexibility of banking transactions through the bank’s Mobile Banking application to provide convenience and comfort for customers while still prioritizing security in every transaction. Deposito iB Amanah A deposit in Indonesian Rupiah using a mudharabah or wadiah contract. This savings product is a time-investment product which can be withdrawn after the maturity. 61 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  63. FINANCING PRODUCTS Sejahtera iB Amanah Consumption financing provided to Civil Servants (ASN), Candidates of Civil Servants (CASN), Civil Servants Retirees, Council Members (Province, District, City), Regional Leaders, Village Officials and Village Heads, National and local private employees, State-owned Corporation (BUMN) employees and BUMN subsidiaries, Regionally-owned enterprise (BUMD) employees and BUMD subsidiaries, and employees of other agencies or companies that have payrol relationships with Bank NTB Syariah to meet consumptive needs. As for the contract used in the implementation of the Sejahtera iB Amanah financing, it is adjusted to the object to be transacted between the Bank and the Customer, which currently uses the murabahah contract for purchases of goods or Conventional Bank loans take over, ijarah contract is for multi-service transactions such as education and health services, pilgrimage trips of Hajj/Umrah, musyarakah mutanaqisah (MMQ) contract is for refinancing transactions on on-going financing or take over financing from other banks, and other contracts suitable for financing needs; Kendara iB Amanah Consumption financing provided for the purchase of motorized vehicles (cars and motorbikes) new in condition and carried out directly by branch offices and sub-branch offices using a murabahah contract; Bale iB Amanah Consumption financing provided for the purchase of property such as house, apartment or ready-to-build plot of land where the collateral is the object being financed using the murabahah and the musyarakah mutanaqisah (MMQ) contracts. As for the Bale iB Amanah product, bank requires Down Payment/DP which is quite affordable for the customers deducted from the bank’s selling price as well as loosening the long installment period Multiguna iB Amanah Consumptive financing provided to employees of BUMN, BUMD, private employees, as well as professionals and entrepreneurs to meet consumptive needs where the collateral is fixed assets i.e. land and buildings and it uses the Murabahah contract for consumer goods purchase transaction and take over from conventional bank, Ijarah contracts for multi-service transactions such as Umrah, registering for Hajj, children's education or other consumptive needs, and musyarakah mutanaqisah (MMQ) contract is for additional or refinancing. The advantage provided by the Multiguna iB Amanah financing is that customers can meet their needs without collateralizing the item to be purchased, besides they have various promos with margin and testing not less competitive with similar facilities at banks and/or financial institutions other than Bank NTB Syariah. Spirit of Amanah, Optimistic and Growth in Sustainable Business Pembiayaan FLPP iB Amanah Consumptive financing for Low-Income Communities (MBR) for subsidized housing ownership. For this financing, Bank NTB Syariah collaborates with the Ministry of Public Works for Public Housing (PUPERA) by using the Housing Financing Liquidity Facility (FLPP) scheme. In 2020, Bank NTB Syariah was one of the Regional Development Banks with the largest distribution for FLPP financing in national level. Cash Collateral Financing Consumption or productive financing Suitable for financing purpose where the collateral is customer deposits such as Time Deposits, Savings and/or Giro issued by Bank NTB Syariah using the musyarakah and murabahah contracts where the margin/profit sharing calculation is determined by the percentage profit sharing of deposits. Tunas Sejahtera iB Amanah Productive financing for Micro and Small Businesses to provide capital and/or business investment development with a maximum amount of IDR50 million. Modal Kerja iB Amanah Productive financing for Small and Medium Enterprises in all Economic Sectors that have the chance of developing productive businesses to provide them capital for their business. Investasi iB Amanah Productive financing for Small and Medium Enterprises in all Economic Sectors that have the prospect of developing productive businesses to develop business investment. Sindikasi iB Amanah Productive financing of Bank NTB Syariah together with other Sharia Banking which is provided to Medium Enterprises in all Economic Sectors which have the prospect of developing productive businesses to provide them capital and/or develop business investment. PT Bank NTB Syariah. 2020 Annual Report 62
  64. Company P ro fi l e s FINANCIAL SERVICES Debit Card iB Amanah A deposit product transaction facility that can be used for withdrawal, payment, purchase or transfer of funds through Bank NTB Syariah ATMs or ATM Bersama, ATM Link and ATM MEPS as well as transactions using Electronic Data Capture (EDC) of Bank NTB Syariah or other banks that are members of the GPN network for shopping transactions at the merchants. ATM iB Amanah a deposit product transaction facility in the form of Bank NTB Syariah Automated Teller Machine (ATM) that can be used by customers of the bank or customers of other banks who are members of the GPN network, ATM Bersama, ATM Link, AMEX (American Express), and JCB (Japan Credit Bureau) to do overbooking transactions between customer accounts, cash withdrawals, transfers to accounts of Bank NTB Syariah or other banks, payment or purchase of monthly bills (bill payments). Mobile Banking iB Amanah A savings product transaction facility to provide convenience and comfort for the customers while still prioritizing security in every transaction in the form of a banking service application via a smartphone with an android or iOS platform which can be downloaded easily on the Play Store or the App Store. Several types of transactions that can be carried out include transfers between customer accounts, transfers to Bank NTB Syariah accounts or other bank accounts, payment or purchase of monthly bills (bill payments). Electronic Data Capture (EDC) iB Amanah A facility in the form of the bank’s EDC machine that can be used by the bank’s customers by using an iB Amanah Debit Card or other bank Debit Cards incorporated in the GPN network. In principle, this machine is widely used for purchase payment transactions through merchants in partnership with Bank NTB Syariah. Besides for payment purposes, this machine can also be used for several other types of transactions namely transfers to accounts of Bank NTB Syariahs or other banks, payments or purchases of monthly bills (bill payments) and others. Cash Management System (CMS) iB Amanah A deposit product transaction facility to provide convenience and comfort for the customers while still prioritizing security in every transaction in the form of a banking service application via the internet (web-based). This application is called Cash Management System and is primarily intended for companies to support faster financial activity processes related to banking transactions. Several types of transactions that can be carried out include monitoring company accounts, transferring between customer accounts, transfers to Bank NTB Syariah accounts and other bank accounts through BI RTGS, SKN , ATM Bersama Online Transfers facility, payment or purchase of obligations to suppliers or monthly bills (bill payments). ) and others. Kas Daerah (KasDa) iB Amanah Asavings product transaction facility to provide convenience and comfort for the customer while still prioritizing security in every transaction in the form of a banking service application via the internet (web-based) which is integrated with the Regional Management Information System (SIMDA) service. This application called Regional Cash Management System and is primarily intended for Provincial and City/District Governments to support faster financial activity processes related to banking transactions. Several types of transactions that can be carried out include monitoring regional cash accounts, transferring between customer accounts, transfers to accounts of Bank NTB Syariah or other bank accounts, payment or purchase of obligations to suppliers or monthly bills (bill payments) and others. SMS Banking iB Amanah Asavings product transaction facility that provides convenience and comfort for the Customer while still prioritizing security in every transaction in the form of a banking service application via a smartphone with an Android or IOS platform which can be downloaded easily in the Play Store or App Store. The SMS Banking service has the advantage of having multi connection access by using the SMS, USSD or Data Connection. It has complete facility features including transfers between customer accounts, transfers to Bank NTB Syariah accounts or other bank accounts, payment or purchase of monthly bills (bill payments), information and account mutations. Jasa Payroll Package (JPP) iB Amanah SMS Notifikasi iB Amanah A service to provide the latest information on the mutation of the Customer's deposit account registered by the Customer through the Short Message System (SMS). Besides being a medium of information, this service also functions as a monitor of transactions that occur in customer savings accounts. 63 PT Bank NTB Syariah. 2020 Annual Report A service for paying salaries, allowances, honorariums and others for employees of an institution or company which is carried out collectively and monthly according to a pay order list. This service is called the Payroll Package Service which provides effectiveness and efficiency for the Institution or Company in managing their payment obligations to employees on-time. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  65. Call Center Service Auto Debit iB Amanah A 24-hour line service at 1500667 that can be utilized by the Customers and public to obtain information related to Bank NTB Syariah banking services . A scheduled transfer service for Customer's payment of obligations or bills through automatic debiting from the Customer's saving account and destination account registered by the Customer. Bank Garansi iB Amanah SKB iB Amanah A payment guarantee from Bank NTB Syariah for certain agreed activities, which is given to the party receiving the guarantee (called the Beneficiary) if the guaranteed party, in this case is the Customer, fails to fulfill obligations or breaches of contract or default. Certain activities that have been agreed upon include, among others, the process of bidding, implementing and receiving project advances. A Bank Certificate issued by Bank NTB Syariah at the customers’ request which is used for a specific purpose and is non-binding, non-promising and non-guaranteeing. SKN iB Amanah A service for sending (transfer) of funds electronically which final settlement is carried out nationally. The Clearing System is divided into Debit Clearing for debit transfers and Credit Clearing for credit transfer activities. Currently, the Clearing System has served for nine periods. MPNG3 iB Amanah An electronic payment service used by Customers to make payments for Taxes, Customs and Excise, Non-Tax State Revenues, Refunds of Expenditures, Non-Budget Revenues, and Receipt of financing to the State. Spirit of Amanah, Optimistic and Growth in Sustainable Business RTGS iB Amanah A service for sending (transfer) of funds electronically, the settlement of which is done at the same time (real time). This transaction is known as the Real Time Gross Settlement (RTGS) and is executed in Indonesian rupiah. Virtual iB Amanah A virtual account provisioning service, namely a virtual account that functions as a sub account of the main savings account. The concept of this service is widely used by Institutions or Companies that have financial transaction activities with other third parties as partners, so that its function is to make it easier for Institutions or Companies to identify financial transactions with other third parties as partners. Every deposit to a virtual account will automatically be booked on the main saving account. PT Bank NTB Syariah. 2020 Annual Report 64
  66. Company P ro fi l e s BUSINESS AREA MAP Development of distribution networks Networks Year 2020 2019 Office Networks 49 Head Office Branch Offices Supporting Branch Offices Cash Office Service Office Cash Car 2018 2017 2016 42 43 43 42 1 12 23 6 7 1 12 21 4 4 1 12 21 4 5 1 11 22 4 5 1 11 22 4 5 5 2 - - - 203 438 18,312 183 574 200 403 10,573 175 415 151 211 5,311 82 330 127 200 2,701 80 - 127 6 1,359 2 - E-Channel: Automatic Teller Machines (ATMs) Electronic Data Captures (EDCs) Mobile Banking Users Laku Pandai Users (Branchless Banking) CMS Corporate Users (Internet Banking) SURABAYA Head Office 65 Branch Coffice PT Bank NTB Syariah. 2020 Annual Report Supporiting Branch Office Spirit of Amanah, Optimistic and Growth in Sustainable Business
  67. Distribution of distribution networks Networks Mataram City North Lombok Regency East Lombok Regency West Lombok Regency Central Lombok Regency Sumbawa Regency West Sumbawa Regency Bima City Bima Regency Dompu Regency Surabaya Total Spirit of Amanah , Optimistic and Growth in Sustainable Business Year HO BO SBO CO and PP 1 1 2 1 2 1 1 1 1 1 1 1 12 2 1 2 2 2 5 2 4 3 23 7 2 1 2 1 13 Cash Car 5 5 ATMs 54 8 26 21 20 28 8 16 9 12 1 203 PT Bank NTB Syariah. 2020 Annual Report 66
  68. Company P ro fi l e s ORGANIZATIONAL STRUCTURES With regard to the implementation of the Bank's operational activities in 2020, the provisions that are effectively used by the Bank as the basis for the implementation of organizational functions during 2020 are based on the Decree of the Board of Directors Number SK.01 / 16/64/022/2020 dated February 17th, 2020 concerning Organizational Structure and Work Procedures of PT Bank NTB Syariah and its changes as follows: GMS PRESIDEN DIRECTOR H. Kukuh Rahardjo SHARIA SUPERVISORY BOARD FUND & SERVICES DIRECTOR FINANCING DIRECTOR FINANCE & BANKING OPERATIONS DIRECTOR H. Saharuddin Muhamad Usman Hj. Baiq Dien Rosana Juwita GM DNR GM TRS GM PBY GM JKE DGM PRJ DGM SPD DGM PRK DGM JKC DGM PBM DEALER DGM PKO DGM TEL GM APK DH APP GM UMM DGM PAK DGM PBJ DGM LPK DGM PAU DH RBN BO CLASS I, II & II SBO CLASS I & II 67 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  69. The dynamics of the development of the Bank 's business and organization which are increasingly complex both in terms of operations and customer needs, have encouraged the Bank to make adjustments and improvements continously in order to find an effective and efficient organizational structure composition. In 2020, Bank NTB Syariah has made several adjustments to the Organizational Structure in order to respond to every opportunity and challenge according to the needs and business orientation of the Bank, including: 1. The first amendment is in accordance with the Decree of the Board of Directors Number: SK.01 / 16/64/001/2020 dated January 2nd, 2020 concerning the Organizational Structure and Work Procedure of PT Bank NTB Syariah regarding changes in the division of work units under the Board of Directors and the addition of Desk level work units namely Business Risk Desk (RBN) under the Directorate of Finance and Operations. 2. Second Amendment, through the Decree of the Board of Directors Number: SK.01 / 16/64/022/2020 dated February 17th, 2020 concerning the Organizational Structure and Work Procedure of PT Bank NTB Syariah regarding the addition of the Director of Financing in charge of the Branch and E-Channel Performance Network Division (JKE) and the Financing Division (PBY) at the same time changing the division of work units under the Board of Directors. 3. Third Amendment, through the Decree of the Board of Directors Number: SK.01 / 16/64/047/2020 dated 10 July 2020 concerning Amendments to the Decree of the Board of Directors Number SK.01 / 16/64/022/2020 concerning Organizational Structure and Administration The work of PT Bank NTB Syariah only concerns the adjustment of several position formations in the organizational structure of Class I, II, and III Branch Offices and is an integral part of the previous Directors' Decree. BOARD OF COMMISIONERS COMPLIANCE & RISK MANAGEMENT DIRECTOR H. Ferry Satrio GM KEP DGM HKM DH MJR BOARD OF COMMISIONERS COMITTEE DIRECTORS COMITTEE DH SEP DGM KPA GM TSI GM SDI GM REN GM SPI DGM PPT DGM PLS DGM PRS DGM PWF DGM PPS DGM CMO KIC SMP AUDITOR Note: : Supervision Line : Coordintaion Line Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 68
  70. Company P ro fi l e s ORGANIZATION STRUCTURES Based on the Decree of the Board of Directors, the Bank's Organizational Structure consists of 5 (five) Directorates, namely the President Director, the Director of Finance, the Director of Funds and Services, the Director of Finance and Operations as well as the Director of Compliance and Risk Management. The management of functions, duties and responsibilities of work units under the Board of Directors are grouped into Business Work Units and Supporting Work Units with the following descriptions: 1. Business Work Unit, is a Division or Desk that is directly related to the Bank's main activities in the collection and management of Third Party Funds, investment of productive assets in the form of financing, placement of securities, provision of Bank services and network management. Some of the current functions of the Business Work Unit are as follows: a. The Retail Funds and Product Development (DNR) Division has the duty and responsibility to formulate a strategic plan for the deve/lopment and marketing of the Bank's retail fund products / services and to ensure that the product development program (content & features) runs according to the direction of the Bank's policies and business strategies to increase market share. b. The Financing (PBY) Division has the duties and responsibilities to plan and manage the distribution of funds in the form of consumer financing and productive financing in accordance with operational standards and procedures as well as regulatory requirements. c. The Treasury (TRS) Division has the main duty and responsibility to manage the Bank's assets in the form of fund placement, corporate fund management, cash management, fundraising, fund marketing, and management and control of the Bank's liquidity. d. The Administration, Supervision and Rescue Financing (APP) Desk has the main duties and responsibilities to manage financing administration, financing rescue, and reporting related to financing and management and settlement of collectibility III, IV, V financing and write-off financing, including processing restructuring. collectability III, IV, V and write-off financing, carry out a periodic collection program for collectability III, IV, V and write-off debtors, as well as manage and evaluate the collectability of III, IV, V and write-off financing. e. The Network, Branch Performance and E-Channel (JKE) Division has the main duties and responsibilities to plan the development and management of the Bank's network and services, E-Channel management, and carry out business development for branch offices including monitoring the implementation of service excellence strategies for improving service quality and customer loyalty throughout the office network. 69 PT Bank NTB Syariah. 2020 Annual Report 2. Supporting Work Unit, is a Division or Desk that has a role to support the implementation of the Bank's main activities in the collection and management of Third-Party Funds, investment of productive assets in the form of financing, placement of securities, provision of Bank services and network management. Some of the functions of the existing Supporting Work Units are as follows: a. The Internal Supervisory Unit (SPI) has the duty and responsibility to carry out supervision independently and objectively by providing assessments, recommendations and internal consultations to minimize risks and encourage all work units to comply with the provisions and policies outlined by management, and act as a management control tool to measure and assessing the effectiveness of operational activities according to their function. b. The Compliance Division (KEP) has the duty and responsibility to formulate steps in order to support the creation of a Compliance Culture in all Bank business activities at every level of the organization by carrying out compliance risk monitoring and control, ensuring the Bank's policies, regulations, systems and procedures. in accordance with the prevailing laws and regulations, as well as establishing and developing steps to assess Good Corporate Governance (GCG). c. The Risk Management Desk (MJR) has the duty and responsibility to formulate standards and policies for risk management (financing risk, market risk, operational risk and others) and conglomerate risk along with the results of evaluation and updates to facilitate management in making policies related to risk mitigation. d. The Strategic Planning Division (REN) has the duty and responsibility for compiling strategic plans, organizational planning and work procedures, managing economic surveys/research and special studies regarding the Bank's business prospects, as well as preparing accountability reports for the Board of Directors. e. The Accounting and Financial Bookkeeping Division (APK) has the duty and responsibility to manage the Management Information System, Financial Information System, Electronic Data Processing and documentation system in each work unit concerned so that the financial management of the Head Office and Branch Offices are able to present data and/or financial statements that can be justified for their truth/accuracy. f. The Human Resources Division (SDI) has the duty and responsibility to carry out the development program, managing and guiding the Bank’s human resources, including coaching services to all work units related to human resources and personnel administration. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  71. g . The Information Technology Division (TSI) has the duty and responsibility to develop and implement the Bank's Information Technology (IT) Strategic Plan, as well as ensuring the continuity of the Bank's operations by ensuring reliable, effective and efficient IT support in accordance with the Bank's business objectives. h. The General Division (UMM) has the main duty and responsibility to manage the procurement of goods and services, facilities, infrastructure, security, and general administration management as well as the auction of fixed assets effectively, efficiently, transparently, fairly and accountably in accordance with policies, systems and procedures of good and services procurement or other general administration. i. The Corporate Secretariat Desk (SEP) has the duty and responsibility to manage the Public Relations, secretarial and protocol activities of the Board of Directors and Commissioners, compile and manage the agenda and meeting documents of the Board of Directors and Commissioners, prepare a schedule and stages of activities leading up to the General Meeting of Shareholders (GMS), compile and manage the Bank's annual report, organize public expose management, corporate image, customer complaint services and public relations, and manage the administration of the Corporate Social Responsibility (CSR) Fund. L j. The Business Risk Desk (RBN) has the task and responsibility of analyzing the implementation of Head Office business activities such as fund management Spirit of Amanah, Optimistic and Growth in Sustainable Business activities (collection and placement), investment management, financing distribution and cooperation in the form of assets. The business risk unit plays a role in ensuring compliance with regulations, standards, policies and procedures in the daily activities of the business unit. The unit alos identifies, measures, monitors, manages and reports business risks to take risk mitigation steps in decision making. At the end of 2020 the Bank made adjustments / changes to several business units at the Head Office according to the Decree of the Board of Directors Number: SK.01/16/64/075/2020 dated December 1st, 2020, these changes will take effect in 2021. Some of the changes are as follows: 1. Upgrading the status of the APP Desk work unit (Administration, Supervision, and Financing Recovery) to become the APR Division (Financing Administration and Remedial Recovery). 2. Splitting the Organizational Structure of the Financing Division into KSM (Consumer) Financing and KRM (Commercial, Retail and Micro) Financing Divisions 3. Changes in the nomenclature of work unit, namely the DNR Division (Retail Funds) to the DNJ (Funds and Services) Division as well as changes in the nomenclature of several position formations. 4. Other changes in the form of merging, adding and reducing position formations. PT Bank NTB Syariah. 2020 Annual Report 70
  72. Company P ro fi l e s COMPANY VISION, MISSION, AND CORPORATE CULTURE Bank NTB Syariah always builds optimism to continue to maintain quality and business growth in a sustainable manner. The Bank has its goals that must be achieved, both for short and long term. The vision and mission are used as benchmarks for achieving the success and progress of the company. Based on the 2018-2022 of PT Bank NTB Syariah Corporate Plan, the vision and mission of the Bank has been approved by the Board of Commissioners and the Board of Directors, with the following explanation: To be a Trustworthy, Reputable, Community Choice Sharia Commercial Bank TRUSTWORTHY REPUTABLE COMMUNITY CHOICE The entire bank management system is performed in a trustworthy manner, meaning that the funds invested by customers will be maintained and safeguarded, so that they reach those who are entitled, and will provide benefits to all stakeholders; To become a leading Sharia Commercial Bank, a sharia bank that is influential in banking industry, is widely recognized, is always ready to face changes, and prioritizes meeting customer needs through excellent service; The sharia bank has excellent performance and a good image, and contributes to and encourages economic growth of customers and society, especially the people of West Nusa Tenggara To realize the vision of sustainable finance, the Bank has a Sustainable Finance mission which is also the main mission of the Bank as follows: 1 Give excellent service and provide innovative Sharia banking products based on customers needs; 2 Develop professional and prosperous human resources through the implementation of a consistent performance-based system; 3 Expand the scope of services for access and transactions through the application of reliable technology; 4 Provide maximum contribution to shareholders and increase the role of social care; 5 Encourage regional economic growth. 71 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  73. CORPORATE CULTURES AND MAIN BEHAVIORS The application of the corporate values starts from habits , beliefs, and characteristics that develop into behaviors as actions and responses to be better. All employees of Bank NTB Syariah have agreed on the values of the corporate culture that are embedded in each individual. Integrity and Work Ethic Implementing Amanah and Sharia Principals Implementing Amanah and Sharia Values in carrying out work and duties in a professional and full of responsibility based on sharia principals. 4 Having consistency in working and always in a high spirit. CORPORATE CULTURES Making Continuous Improvement This means that it always makes improvements to obtain added value and achieve the best performance. Spirit of Amanah, Optimistic and Growth in Sustainable Business Implementing Synergy in Achieving Goals Always make improvements to get added value and achieving the best performance. Carrying out productive cooperative relationship and harmonious partnerships with stakeholders. PT Bank NTB Syariah. 2020 Annual Report 72
  74. Company P ro fi l e s MAIN BEHAVIORS HONEST AND IKHLAS Honesty the attitude of the heart that is reflected in good deeds, righteous, not lying (telling the truth), not cheating. Ikhlas is the attitude of heart that is reflected in acts of kindness without strings attached or hidden desires. COURTEOUS AND FRIENDLY Courtesy is the attitude of the heart that is reflected in actions that are subtle in speech and are good in behavior, patience, calm, polite, compassionate and helpful. Friendly is the attitude of the heart that is reflected in good deeds and is attractive, sociable and pleasant COMPETENT AND RESPONSIBLE Competent is having abilities and skills that are appropriate or sufficient to carry out the duties and responsibilities. Responsible is the willingness to accept and carry out tasks well and bear all consequences for the actions taken. DISCIPLINE AND CONSISTENT Discipline is the attitude of the heart that is reflected in the conduct and execution of duties and responsibilities that are appropriate or compliant with applicable regulations. Consistent is the attitude of the heart that is reflected in good deeds and obedience that is continuous, unchanging, orderly and in harmony. RESILIENT AND DEDICATION Resilient is persistance and never give up when facing the challenges Dedication is comitted and devoted wholeheartedly to the company as well as being positive and using its capabillities to the fullest for the success of the company 73 PT Bank NTB Syariah. 2020 Annual Report CREATIVE AND INNOVATIVE Creative is the attitude and deed to develop and create ideas, initiatives or new ways that are different from before and useful in the implementation of tasks and responsibilities. Innovative is the attitude and deed to utilize the ability and expertise to produce new work that is useful in the implementation of tasks and responsibilities CONTINUOUSLY LEARNING AND DEVELOPING Continuously learning is the act of continually trying to obtain and improve the knowledge and competencies needed in carrying out tasks and responsibilities. Continuously developing is the attitude, deed and openness to add and expand the self-potential virtues. RESPONSIVE AND PROACTIVE Responsiveness is the attitude of the heart that is reflected in fast and responsive actions, (not indifference) in reading any situation or event. Proactive is the attitude of the heart that is reflected in spontaneous actions, more active and not waiting for a reaction in the face of something. PRODUCTIVE AND DYNAMIC Productive is always doing something meaningful for itself, work environment, and the company, as well using its capabillities to the fullest to achieve the best result for the company. Dynamics is always ready to face the challenges ans working in different place, situation, and in any type of work assigned. HARMONIOUS AND RESPECTING DIVERSITY Harmonious is a teamwork to achieve the unity and harmony Respecting Diversity is respecting the initiative diversity, role, and other people contribution. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  75. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 74
  76. Company P ro fi l e s SHARIA SUPERVISORY BOARD PROFILE Certifications and Trainings TGH. Rubai Ahmad Munawar, Lc., M.Si Chairman Citizenship Indonesia. Certification of Sharia Banking Supervisory Board Sharia Banking Batch IX, Jakarta (October 28, 2013) Certification of The Role and Function of Commissioner, Directors and Sharia Supervisory Board in Managing Islamic Bank, Jakarta (May 10, 2014) Exclusive Certification of Maqashid Syariah Application in Sharia Banking and Financial Products Batch 120, Jakarta (5 February 2015) Ijtima'Sanawi, DPS, LKS, OJK, DSN-MUI, Bandung (December 19, 2015) Exclusive Certification of Financing Sharia Refinancing, Take Over, MMQ and Hybrid Contracts, batch 190, Mataram (September 10, 2016) Certification of Product Operational Standards and Sharia Banking Contracts, OJK, Surabaya (20 October 2016) Ijtima’ Sanawi, DPS, LKS, OJK, DSN-MUI, Jakarta (9 December 2016) iB Overview For The Boards Certification, Jakarta (January 26, 2017) Ijtima' Sanawi, DPS, LKS, OJK, DSN-MUI, Jakarta (November 2017) Certification and Capacity Building of the Sharia Supervisory Board, Surabaya (April 12, 2018) Sharia Supervisory Competency Certification, National Professional Certification Board, Jakarta (July 16, 2018) Ijtima'Sanawi, DPS, LKS, OJK, DSN-MUI, Jakarta (November 2018) Certification of Sharia Line Facility Financing for Bankers, Academics and DPS Batch 368, Jakarta (September 11, 2019) Ijtima'Sanawi, DPS, LKS, OJK, DSN-MUI, Bogor (October 2019) Webinar Ijtima’Sanawi DPS, LKS, OJK, DSN-MUI, through the Zoom Cloud Meeting application (November 2020). Work Experience Before serving as Chairman of the Sharia Supervisory Board of PT Bank NTB Syariah, once served as: Chairman of the Sharia Supervisory Board, PT. Bank NTB Syariah (April 2018 - April 2022) Sharia Supervisory Board Member, UUS Division PT. Bank NTB (2013 - 2018) Political and Information Staff, Embassy of the Republic of Indonesia, Beirut, Lebanon (1998 - 2005); Announcer, translator and editor of the Radio of the Arab Republic of Egypt (1990-1997); Sharia Banking Study Program Lecturer, Islamic Institute of Hamzanwadi, Pancor; Operational Director of PT Radio Hamzanwadi, East Lombok; Domicile Legas Basis of Appointment East Lombok, West Nusa Tenggara, Indonesia Appointed as Chairman of the Sharia Supervisory Board of Bank NTB Syariah based on the decision of the Extraordinary General Meeting of Shareholders (EGMS) of PT Bank NTB Syariah dated August 21, 2018 as outlined in the Deed of Amendment to the Articles of Association of PT Bank NTB Syariah Number 5 dated August 21, 2018. And, Recommendations DSN-MUI No: U-285 / DSN-MUI / IV / 2-18. Place of Birth, Date of Birth, and Age Kalijaga, December 25 , 1962, 57 years old on December 31, 2020. Educational Background Bachelor of Sharia, Al-Azhar University Cairo, Egypt (1990) Master of Sharia, Darul Ulum University (2011) Term of Office Term of office effective from September 4, 2018 till September 4, 2022. Concurrent Position Does not have Concurrent Positions at other Banks and Non-Bank Financial Institutions or other Companies. Affiliate Relationship Does not have an Affiliate Relationship, either with other members of the Board of Directors, members of the Board of Commissioners, Sharia Supervisory Board, or the Controlling and Major Shareholders Bank NTB Syariah Share Ownership Does not have stocks in Bank NTB Syariah. 75 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  77. TGH . Rubai Ahmad Munawar, Lc., M.Si Sharia Supervisory Board Chairman Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 76
  78. Company P ro fi l e s SHARIA SUPERVISORY BOARD PROFILE Citizenship Indonesia. Domicile East Lombok, West Nusa Tenggara, Indonesia Place of Birth, Date of Birth, and Age Kelayu, October 01, 1961 58 years old on April 22, 2020 Educational Background Bachelor of Sharia, Al-Azhar University Cairo, Egypt (1987) Master of Sharia, Malaya University, Kuala Lumpur (1999) Term of Office TGH Hudatullah Muhibuddin Abdul Aziz, Lc., MA Member 77 PT Bank NTB Syariah. 2020 Annual Report Length of service since the Extraordinary General Meeting of Shareholders (EGMS) on August 21, 2018 and ends on April 22, 2020 based on the decision of the Annual General Meeting of Shareholders (GMS) for the 2019 Financial Year. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  79. BOARD OF COMMISIONERS PROFILES H . Muslihun Independent Commisioner H. Zainal Fanani Independent President Commisioner Spirit of Amanah, Optimistic and Growth in Sustainable Business H. Muhammad Nur Commisioner PT Bank NTB Syariah. 2020 Annual Report 78
  80. Company P ro fi l e s BOARD OF COMMISIONERS PROFILE Certifications and Trainings National Seminar, Regional Development Bank Strategies in Facing the Impact of the Covid-19 Pandemic, FKDK BPDSI (2020) Sustainable Finance Training, TSC (2020) Refreshing on Level V Risk Management Certification, Indonesian Banking Training Institute (2019) Refreshment of Risk Management Certification - Sustainable Finance, LPPI Jakarta (2019) Refreshing on Level V Risk Management Certification, Indonesian Banking Training Institute (2017) Implementation of Risk Management Information Technology on Banking Industry, Indonesian Banking Training Institute (2017). Governance, Risk Management and Compliance, Financial Services Authority (2014) Refreshment of Level V Risk Management Certification, Banker Association for Risk Management (BARA), Frankfurt German (2012) Indonesian Banking Facing the Enactment of the ASEAN Economic Community, Communication Forum of the Board of Commissioners of BPD All Indonesia (2012). Banking Crime Prevention, Bank Indonesia (2012). Refreshment of Level V Risk Management Certification, BSMR Amsterdam, The Netherlands (2010). Refreshment of Level V Risk Management Certification, Risk Management Certification Agency (BSMR), Denpasar Bali (2007) Sharia Banking Basic Training Certificate, Indonesian Banking Training Institute (1999) Work Experience H. Zainal Fanani Independent President Commisioner Citizenship Indonesia. • • • • Expert Staff and Consultants, Indonesian Banking Training Institute (2017 - present). Compliance Director, Bank Syariah Mandiri (2010 - 2014). Compliance and Risk Management Director, Bank Syariah Mandiri (2007 - 2010) Head of Development Planning and Performance Management Division, Bank Syariah Mandiri (2002 - 2007) Legas Basis of Appointment Bekasi, West Java, Indonesia. Appointed as the Independent President Commissioner of Bank NTB Syariah for the first time based on the decision of PT Bank NTB Syariah Extraordinary General Meeting of Shareholders on 21 August 2018 which was stated in the Deed of Amendment to the Articles of Association of PT Bank NTB Syariah Number 5 dated 21 August 2018. Place of Birth, Date of Birth, and Age Term of Office Domicile Ngawi, October 24, 1964, 56 years old on December 31, 2020. Term of office effective from September 4, 2018 till September 4, 2022. Concurrent Position Educational Background Does not have Concurrent Positions at other Banks and Non-Bank Financial Institutions or other Companies. Bachelor of Civil Engineering in Transportation, 10 November Institute of Technology Surabaya (1989). Affiliate Relationship Does not have an Affiliate Relationship, either with other members of the Board of Directors, members of the Board of Commissioners, Sharia Supervisory Board, or the Controlling and Major Shareholders. Bank NTB Syariah Share Ownership Does not have stocks in Bank NTB Syariah. 79 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  81. BOARD OF COMMISIONERS PROFILE Certi fications and Trainings Virtual seminar: "Indonesia Risk Management Outlook (IRMO) 2021", LPPI (Dec-2020). National Seminar, Regional Development Bank Strategies in Facing the Impact of the Covid-19 Pandemic, FKDK BPDSI (2020) Sustainable Finance Training, TSC (2020) Webinar: “Financial Service Innovation When New Normal- Traditional Banks vs. Challenger Bank, LPPI (June-2020). Sharia Online Talk: "Get to know Halal and Legal Sharia Fintech", Central MES (May-2020). Training: "Prophetic Leadership and Management Wisdom (Fundamental Module)," PROLM Jakarta (Dec-2019). Sharia Banking Basic Training Certification, “Executive Overview of Islamic Bank”, Indonesian Banking Training Institute (2019); Seminar: "The role of the Compliance Director in Responding to the Challenges of the Digital economy and Banking Readiness to Face the Mutual Evaluation Review (MER)," FKDKP (June 2019). Risk Management Level 2 Certification, Jakarta Banking Professional Certification Institute (2018). Training of Trainer Module for Islamic Economics and Finance (Zakat, Waqf, and Islamic Micro Business), Bank Indonesia (2018). National Seminar "The Role of the Board of Commissioners and Directors in Prevention of Fraud Detection and Investigation in Banking", FKDK BPD-SI (2018). Work Experience H. Muslihun Independent Commisioner Citizenship Indonesia. Domicile Mataram, West Nusa Tenggara, Indonesia Place of Birth, Date of Birth, and Age Coordinator and Member of the Technical Implementation of the NTB Province DSN-MUI Secretariat (2017). Sharia Supervisory Board, several Sharia Cooperatives in NTB (2017). Sharia Coordinator at the NTB Province Cooperative and UMKM Office (2016). Coordinator of the Management of the Indonesian Waqf Board Representative of NTB in the Field of Waqf Research and Development (2013 - 2017). General Secretary of the NTB Province National Sharia Abritase Agency (Badan Abritase Syariah Nasional (Basyarnas)) (2011 - 2016). Chairman of the Department of Islamic Economics, Faculty of Sharia and Islamic Economics, Mataram State Islamic University (2010 - 2015). Lecturer in the Faculty of Economics and Business, Mataram State Islamic University (2001 - present). Legas Basis of Appointment Sakra, East Lombok, May 13, 1974 46 years old on December 31, 2020. Appointed as an Independent Commissioner of Bank NTB Syariah based on the decision of the Extraordinary General Meeting of Shareholders (EGMS) of PT Bank NTB Syariah on August 21, 2018 as outlined in the Deed of Amendment to the Articles of Association of PT Bank NTB Syariah Number 5 dated August 21, 2018. Educational Background Term of Office Bachelor of Religius studies, Hamzanwadi Islamic Institute (1998), Master’s degree, IAIN Sunan Kalijaga (2001) Doctoral Degree, IAIN Walisongo Semarang (2012). Term of office effective from September 4, 2018 till September 4, 2022. Concurrent Position Does not have Concurrent Positions at other Banks and Non-Bank Financial Institutions or other Companies. Affiliate Relationship Does not have an Affiliate Relationship, either with other members of the Board of Directors, members of the Board of Commissioners, Sharia Supervisory Board, or the Controlling and Major Shareholders. Bank NTB Syariah Share Ownership Does not have stocks in Bank NTB Syariah. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 80
  82. Company P ro fi l e s PROFIL DEWAN KOMISARIS Certifications and Trainings Sustainable Finance Training, TSC (2020) Sharia Banking Basic Training Certification, Executive Overview of Islamic Bank, Indonesian Banking Training Institute (2019). Level I Competency Certification for Commissioners, Banking Risk Management, National Professional Certification Agency (2015). Education and Training for Level I Risk Management Certification Competency Test, Indonesian Banking Training Institute (2015). Education and Training for Upgrading Management of the Strategic Economic Sector, Batch IX by the Ministry of Home Affairs of the Republic of Indonesia (1997). Education and Training of National Administrative Leadership Staff Schools by the Ministry of Home Affairs and the State Minister for State Apparatus and State Administration Institutions (1995). Technical Functional Education and Training Course on Regional Government and Urban Management, Batch X by the Ministry of Home Affairs of the Republic of Indonesia (1991). Education and Training of Administrative Colleges of Kindergarten Class Work Experience H. Muhammad Nur Commisioners Citizenship Indonesia. Domicile Mataram, West Nusa Tenggara, Indonesia. Place of Birth, Date of Birth, and Age Bima, December 28, 1957 usia 63 years old on December 31, 2020. Educational Background Bachelor of Laws, Mataram University (1983) Master of Government Science, Udayana University (2005) Commissioner of PT Bank NTB Syariah (2018-present) Regional Secretary of NTB Province (2010 - 2016) Official Regent of Sumbawa Regency (2010) Assistant for Economy and Development of the NTB Provincial Secretariat (2008 - 2010) Head of Bakesbangpol NTB Province (2008) Head of the Culture and Tourism Department of NTB (2006 - 2008) Secretary of the Provincial KPU NTB (2005 - 2006) The officer of Mayor of Bima (2002) Head of General Bureau of the Regional Secretary of NTB Province (1999 - 2001) Regional Secretary of Lospalos Regency, East Timor (1995 - 1998) Official Regent of the District of Ainaro East Timor (1995) Regional Secretary of Ainaro Regency, East Timor (1989 - 1995) Legas Basis of Appointment Appointed as a Commissioner of Bank NTB Syariah based on the decision of the Extraordinary General Meeting of Shareholders (EGMS) of PT Bank NTB Syariah on August 21, 2018 as outlined in the Deed of Amendment to the Articles of Association of PT Bank NTB Syariah Number 5 dated August 21, 2018. Term of Office Term of office effective from September 4, 2018 till September 4, 2022. Concurrent Position Does not have Concurrent Positions at other Banks and Non-Bank Financial Institutions or other Companies. Affiliate Relationship Does not have an Affiliate Relationship, either with other members of the Board of Directors, members of the Board of Commissioners, Sharia Supervisory Board, or the Controlling and Major Shareholders. Bank NTB Syariah Share Ownership Does not have stocks in Bank NTB Syariah. 81 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  83. DIRECTORS PROFILE Hj . Baiq Dien Rosana Juwita Director of Finance and Operations Spirit of Amanah, Optimistic and Growth in Sustainable Business H. Kukuh Rahardjo President Director Muhamad Usman Director of Financing PT Bank NTB Syariah. 2020 Annual Report 82
  84. Company P ro fi l e s DIRECTORS PROFILE Certifications and Trainings Sustainable Finance, TSC (2020) Risk Management Certification Level 5, Global Association of Risk Professionals (2016) Risk Management Certification Level 5, Banking Professional Certification Institute (2015) Sharia Banking Basic Training Certificate, Banking Professional Certification Institute (2011) International Certified Wealth Management Association, MM UGM Jakarta (2011) Leadership Development Program, United in Deversity (2011) Consumer Insight in Blue Ocean Strategy, IPMI Business School (2007) Risk Management Certificate (2005) Twinning Program Certificate on Sales & Product Management (2005) Marketing Strategy Certificate, Asian Institute of Management (AIM) Philippines (2004) Certificate of Balridge Criteria for Excellent Performance, Tata Group Consultant (2004) Leadership Certificate, (2003) Winning on Competition, Havard University and University of Indonesia (2002) International Strategic Marketing Research Training Certificate, Global Brand Forum, Singapore (2000) Work Experience H. Kukuh Rahardjo President Director Citizenship Indonesia. Domicile Mataram, West Nusa Tenggara, Indonesia Starting his career in Bank Nasional Indonesia (BNI) in 1992 before moving to BNI Syariah with several strategic positions and being a Consultant in the last few years with the following explanation: President Director, PT. Bank NTB Syariah (2018 - Present) Talenta Hasanah Consultant and Lecturers (2017 - 2018) Business Development Consultant and Property Projects in several Development Companies (2017 - 2018) Business Director, Bank BNI Syariah (2016 - 2017) EVP of Consumer Financing, BNI Syariah (2015 - 2016) EVP of Funds and Financing, BNI Syariah Retail (2013 - 2015) EVP of Retail and Network Business, BNI Syariah (2011 - 2013) VP Consumer Business, Jakarta Kota Area, BNI (2011) SAVP Consumer, Jakarta Processing Center, BNI (2008 - 2011)) AVP Mortgage and Business Strategy, BNI (2004 – 2008 Legas Basis of Appointment Jakarta, November 24, 1968, 52 years old on December 31, 2020. Appointed as Director of Funds and Services of NTB Syariah based on the decision of the Extraordinary General Meeting of Shareholders (EGMS) of PT Bank NTB Syariah on August 21, 2018 as outlined in the Deed of Amendment to the Articles of Association of PT Bank NTB Syariah Number 5 dated August 21, 2018. Educational Background Term of Office Place of Birth, Date of Birth, and Age Professional Master’s Degree in Small and Medium Industrial Business Management, Bogor Agricultural University (2004) Agricultural Engineer of the Agricultural Socio-Economic Department, Yogyakarta "Veteran" National Development University (Universitas Pembangunan Nasional “Veteran” Yogyakarta)(1991) Term of office effective from September 4, 2018 till September 4, 2022. Concurrent Position Does not have Concurrent Positions at other Banks and Non-Bank Financial Institutions or other Companies. Affiliate Relationship Does not have an Affiliate Relationship, either with other members of the Board of Directors, members of the Board of Commissioners, Sharia Supervisory Board, or the Controlling and Major Shareholders. Bank NTB Syariah Share Ownership Does not have stocks in Bank NTB Syariah. 83 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  85. DIRECTORS PROFILE Certi fications and Trainings Sustainable Finance Workshop, TSC (2020) Economic Outlook Workshop and Work Meeting, ADPI (2018) Economic Outlook 2017 “New Era, Protectionism”, ADPI (2017) Socialization and workshop on the implementation of PSAK 71, Asbanda (2017) Sharia Banking Basic Training Certificate, ICDIF LPPI (2017) Executive Overview of Islamic Bank, ICDIF LPPI (2016) Indonesia Banking Human Capital Forum, Asbanda (2016) Dynamic Capital Management Workshop (2015) Executive Training of Islamic Banking, Tazkia (2013) Risk Management Certification Level 3, Risk Management Certification Body (2008). Work Experience Started his career at Bank NTB Syariah (formerly BPD NTB) in 1987 with several strategic positions as follows: Director of Finance and Operations (2018-present) General Director (2010 - 2018) Head of the Treasury Division (2009 - 2010) Planning Division Leader (2007 - 2009) Mataram Branch Leader (2005 - 2006) Deputy Leader for Operations Pejanggik Office (2004 - 2005) Leader of Planning and Development Sub-Division (2002 - 2004) Legas Basis of Appointment Hj. Baiq Dien Rosana Juwita Director od Finances & Operations Citizenship Indonesia. Domicile Mataram, West Nusa Tenggara, Indonesia Place of Birth, Date of Birth, and Age Mataram, November 19, 1963, 57 years old on December 31,2020. Educational Background Bachelor of Economics majoring in Accounting, STIE Malang Kucecwara (1986) Master of Business Administration, PPMT Malang (1993) Spirit of Amanah, Optimistic and Growth in Sustainable Business Appointed as Director of Funds and Services of NTB Syariah based on the decision of the Extraordinary General Meeting of Shareholders (EGMS) of PT Bank NTB Syariah on August 21, 2018 as outlined in the Deed of Amendment to the Articles of Association of PT Bank NTB Syariah Number 5 dated August 21, 2018. Term of Office Term of office effective from September 4, 2018 till September 4, 2022. Concurrent Position Does not have Concurrent Positions at other Banks and Non-Bank Financial Institutions or other Companies. Affiliate Relationship Does not have an Affiliate Relationship, either with other members of the Board of Directors, members of the Board of Commissioners, Sharia Supervisory Board, or the Controlling and Major Shareholders. Bank NTB Syariah Share Ownership Does not have stocks in Bank NTB Syariah. PT Bank NTB Syariah. 2020 Annual Report 84
  86. Company P ro fi l e s DIRECTORS PROFILE Certifications and Trainings Certification of Pension Fund Certification Institutions, Jakarta Basic Knowledge of Pension Funds (2020) Certification of Risk Management Certification Bodies (BSMR), Jakarta Risk Management Level 5 (2019) Certification of the Banking Professional Certification Institute (LSPP), Jakarta Level 4 Risk Management (2019) Certification of the Banking Professional Certification Institute (LSPP), Jakarta Risk Management Level 3 (2015) TSC, Mataram Sustainable Finance Training (online) (2020) ADPI, General Management of Pension Funds, Jakarta (online) (2020) BNI Syariah, Training on Sharia Financing Aspects, Jakarta (2019) BNI Syariah, Core Credit Skill Training, Jakarta (2018) LSPP, Banking Risk Management Response Training, Jakarta (2017) MARSLIO Training, International Conference On Gold Dinar Economy, Kuala Lumpur (2007) BNI Syariah, Six Sigma Awareness, Jakarta (2006) ESQ Leadership, ESQ Training Jakarta (2005) LPPI, Basic Training in Islamic Banking, Jakarta (2005) Stand Card Bank, Core Credit Workshop, Jakarta (2004) Bank BNI, Banking Operational Training, Jakarta (1997) Work Experience Muhamad Usman Director of Financing Citizenship Indonesia. Domicile Jl. Adisucipto, Griya Selaparang no A16 Pejarakan Karya Mataram Place of Birth, Date of Birth, and Age Solo, Mei 117 , 1971, 49 years old on Desember 31, 2020. Educational Background Master of Management, Accounting Management Department, Gajah Mada University, Yogyakarta (1996) Architectural Engineering Department of Architecture, Gajah Mada University, Yogyakarta (1994) Starting his career at Bank Nasional Indonesia (BNI) in several strategic positions with the following explanations: Director of Finance of PT Bank NTB Syariah (2020 - Present) Branch Manager BNI Syariah Surakarta Branch (2018-2019) Deputy Division Head Consumer and Financing Card Division of Bank BNI Syariah (2016-2018) Branch Manager of BNI Syariah, Bumi Serpong Damai Branch (2015-2016) Deputy Division Head Consumer Financing Division Bank BNI Syariah (2015-2015) Coordinator Manager of the Consumer Financing Division of Bank BNI Syariah (2013-2015) Division Head Commercial Division BNI Syariah (2012-2013) Legas Basis of Appointment Diangkat sebagai Direktur Pembiayaan Bank NTB Syariah untuk pertama kali berdasarkan keputusan Rapat Umum Pemegang Saham (RUPS) Sirkuler PT Bank NTB Syariah yang telah ditandatangani terakhir oleh Pemegang Saham pada tanggal 11 Februari 2020 dan ditegaskan kembali dalam RUPS Tahunan Tahun Buku 2019 pada tanggal 22 April 2020. Term of Office Masa Jabatan sejak tanggal 9 Maret 2020 sampai dengan 9 Maret 2024. Concurrent Position Does not have Concurrent Positions at other Banks and Non-Bank Financial Institutions or other Companies. Affiliate Relationship Does not have an Affiliate Relationship, either with other members of the Board of Directors, members of the Board of Commissioners, Sharia Supervisory Board, or the Controlling and Major Shareholders. Bank NTB Syariah Share Ownership Does not have stocks in Bank NTB Syariah. 85 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  87. DIRECTORS PROFILE H . Saharuddin Director of Funds and Services H. Ferry Satrio Director of Compliance and Risk Management Citizenship Citizenship Indonesia. Indonesia. Domicile Domicile Mataram, West Nusa Tenggara, Indonesia Mataram, West Nusa Tenggara, Indonesia Place of Birth, Date of Birth, and Age Place of Birth, Date of Birth, and Age Mataram, June 21, 1960 59 years old on December 31, 2020. Yogyakarta, July 24, 1961 59 years old on Desember 31, 2020. Educational Background Educational Background Bachelor of Economics, Mataram University (1987) Master’s in management, Mataram University (2005) Bachelor of Laws, Mataram University (1986) Master’s in management, Mataram University (2006) Term of Office Term of Office Length of service since the Extraordinary General Meeting of Shareholders (EGMS) on August 21st, 2018 and ends on April 22nd, 2020 based on the decision of the Annual General Meeting of Shareholders (GMS) for the 2019 Financial Year. Length of service since the Extraordinary General Meeting of Shareholders (EGMS) on August 21st, 2018 and ends on April 22nd, 2020 based on the decision of the Annual General Meeting of Shareholders (GMS) for the 2019 Financial Year. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 86
  88. Company P ro fi l e s (Sitting) From left to right: Kukuh Rahardjo [President Director] - Sumbawa Traditional Costume B. Dien Rosana Juwita [Director of Finance and Operations] - Sasak Traditional Costume Muhamad Usman [Director of Financing] - Bima Traditional Costume 87 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  89. (Standing) From left to right: H. M. Taufiq Gozi [Sumbawa traditional costume], Febrianto Budi Cahyono [Bima traditional costume], L. Audi [Bima traditional costume], H. Nurul Hadi [Sumbawa traditional costume), Fakhriati Mahruf [Sumbawa traditional costume]. Nur Herlina [Sasak traditional costume], Ni Nyoman Saraswati [Sumbawa traditional costume], Hj. Andarini [Sumbawa traditional costume], Sri Wahyuni [Bima traditional costume, H. Usman [Sasak traditional costume}, Adhi Susantio [Sasak traditional costume], Zainal Abidin Wahyu Nugroho [Sasak traditional costume], L. Isnandar Pademan [Sasak traditional costume], Hari Hartanto Edi Asmara [Sasak traditional costume]. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 88
  90. Company P ro fi l e s EXECUTIVE OFFICERS PROFILES MAIN DIRECTORATE Heri Hartanto Edi Asmara (Technology and Information Systems Division) Hj. Andarini (Internal Audit Unit Division) Lalu Isnandar Pademan Kukuh Rahardjo (Human Resources Division) (President Director) 89 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  91. MAIN DIRECTORATE Hj . Andarini (Internal Audit Unit Division) Indonesian citizen, born in Yogyakarta on July 23rd, 1965, aged 55 years. She Completed her undergraduate education program at the Faculty of Economic, Indonesian Islamic University Yogyakarta in 1988 and first joined BPD NTB in 1989 through a recruitment program. Several strategic positions have been entrusted to Hj. Andarini, among others, is the Head of the Credit Division, General Manager of the Accounting and Financial Control Division and most recently as the General Manager of the Internal Audit Unit Division. Hari Hartanto Edi Asmara (Technology and Information Systems Division) Indonesian citizen, born in Yogyakarta on September 14th, 1967, aged 53 years. Completed his undergraduate education at the Faculty of Law, Islamic University of Indonesia in 1993. Starting his career at BPD NTB in 1995 through a recruitment program. Hari Hartanto has entrusted several strategic positions with the leadership of the Information Technology Development Sub Division and most recently as General Manager of the Technology and Information Systems Division. (Late) Lalu Isnandar Pademan (Human Resources Division) Indonesian citizen, born in Rarang, East Lombok on June 16th, 1967, aged 53 years, passed away on January 11th, 2021. Completed his undergraduate education at the Faculty of Economic, University of Mataram in 1991 and Postgraduate Program (S2), majoring in Management at Mataram University in 2006. Starting his career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to Lalu Isnandar Pademan, including Deputy Leader of the Selong branch office, Head of the Human Resources Development and Services Sub Division, most recently as General Manager of the Human Resources Division. Nur Herlina (Corporate Secretary Desk) She is an Indonesian citizen, born in Mataram on August 1st, 1967, aged 53 years. Completed his undergraduate education at the Faculty of Law at Al-Azhar Mataram in 2005. Started his career at BPD NTB in 1993 through a recruitment program. Several strategic positions have been entrusted to Nur Herlina, including Deputy General Manager of Management and Services of SDI and most recently as Corporate Secretary Desk. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 90
  92. Company P ro fi l e s EXECUTIVE OFFICERS PROFILES DIRECTORATE OF FUNDS & SERVICES H. Nurul Hadi H. Usman (Treasury Division) (Retail Funds and Product Development Division) Muhamad Usman (ad. Direktur of Fund and Service) 91 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  93. DIRECTORATE OF FUNDS AND SERVICES H . Usman (Retail Funds and Product Development Division) Indonesian citizen, born in Praya, Central Lombok Regency on Tuesday, September 20th, 1966, aged 54 years. Completed his undergraduate education at Al-Azhar University at the Faculty of Law in 2001 and the Postgraduate Program (S2) majoring in Financial Management at Mataram University in 2016. He started his career at BPD NTB in 1987 through a recruitment program. Several strategic positions have been entrusted to H. Usman, including the Head of the Sub-Division of Accounting and Financial Control, Head of the Operational Sub Division, Deputy General Manager of the Retail Funds and Product Development Division and most recently as General Manager of the Retail Funds and Product Development Division. H. Nurul Hadi (Treasury Division) Indonesian citizen, born in Kelayu, East Lombok on July 31, 1965, aged 55 years. Completing his undergraduate education at the Faculty of Economic, University of Mataram in 1993. Starting his career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to H. Nurul Hadi, including Deputy Manager of the Pejanggik Main Branch, Head of the Sub-Division of Goods & Services Procurement, General Manager of the General Division and most recently as General Manager of the Treasury Division Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 92
  94. Company P ro fi l e s EXECUTIVE OFFICERS PROFILES DIRECTORATE OF FINANCE AND OPERATIONS Adhi Susantio (Risk Business Desk) Febrianto Budi Cahyono (General Division) Ni Nyoman Saraswati Sri Wahyuni (Accounting and Financial Control Division) (Finance, Administration, and Rescue Desk ) Hj. Baiq Dien Rosana Juwita (Director of Finance and Operations) 93 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  95. DIRECTORATE OF FINANCE AND OPERATIONS Ni Nyoman Saraswati (Accounting and Financial Control Division) Indonesian citizen, born in Mataram on January 18, 1969, aged 51. Completing his undergraduate education at the Faculty of Economic, University of Mataram in 1993 and Postgraduate Program (S2) in Management Department at Mataram University in 2005. He started his career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to Ni Nyoman Saraswati, including Head of the Risk Management Desk, Deputy GM Settlement & Fund Management and most recently as General Manager of the Accounting and Financial Control Division. Sri Wahyuni (Finance Administration and Rescue Desk) Indonesian citizen, born in Bima on July 26, 1967, aged 53 years. Completed his undergraduate education at Universitas Muslim Indonesia Ujung Pandang in 1992. He started his career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to Sri Wahyuni, including the Head of the Mataram Sub-Branch, the Head of the Karang Jangkong Branch, the Deputy Head of the Sumbawa Branch, the Deputy GM of Retail and Consumer Financing, and most recently as the Desk Head of Administration, Supervision, and Financing Rescue. Febrianto Budi Cahyono (General Division) Indonesian citizen, born in Singaraja Bali on February 29, 1968, aged 52 years. Completing his undergraduate education at the Faculty of Economic at Widaya Gama University Malang in 1992. Starting his career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to Febrianto Budi Cahyono, including the Head of the Mataram Sub-Branch and most recently as General Manager of the General Division. Adhi Susantio (Risk Business Desk) Indonesian citizen, born in Mataram on October 14, 1971, aged 49 years old. He completed his undergraduate education at the Trianandra School of Economic, Jakarta in 1992. Starting his career at BPD NTB in 2011 through a recruitment program. Several strategic positions have been assigned to Adhi Susantio, including Deputy Head of Gerung Branch, Auditor of the SPI Division, Deputy GM of Fraud Supervision and Prevention Management, and most recently as the Business Risk Desk Head. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 94
  96. Company P ro fi l e s EXECUTIVE OFFICERS PROFILES DIRECTORATE OF FINANCING Zainal Abidin Wahyu Nugroho (Financing Division) H. Muhammad Taufiq Gozi (Network, Branch Performance, and E-Channel Division) Muhamad Usman (Director of Financing) 95 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  97. DIRECTORATE OF FINANCING Zainal Abidin Wahyu Nugroho (Financing Division) Indonesian citizen, born in Mataram on Thursday, May 7th, 1970, aged 50 years. He completed his undergraduate education at the Economic and Business Faculty, University of Mataram in 1994. Started his career at BPD NTB in 2017 as a contract worker. Zainal Abidin Wahyu Nugroho entrusted several strategic positions as Head of the Productive Credit Sub Division, Deputy General Manager of the Commercial Financing Division, and most recently as General Manager of the Financing Division H. Muhammad Taufiq Gozi (Network, Branch Performance, and E-Channel Division) Indonesian citizen, born in Mataram on August 22nd, 1965, aged 54. He completed his undergraduate degree at the Faculty of Economic, University of Mataram in 1989, Postgraduate Program (master’s degree) at Master of Management at Universitas Mataram in 2003 and Postgraduate Program (Doctorate degree) in the Department of Islamic Economics at Universitas Airlangga in 2015. He started his career at BPD NTB in 1990 through a recruitment program. Several strategic positions have been entrusted to H. Muhammad Taufiq Gozi, including as Sub-Branch Sweta Manager, Chief of Secretary Desk Leader, Chief of Strategic Planning Sub-Division Leader, Chief of Network and Service Development Division, Chief of Sharia Business Unit Division, General Manager of Retail Funds and Product Development Division, and finally as General Manager of Network, Chief of branch performance and e-channel Development Division. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 96
  98. Company P ro fi l e s EXECUTIVE OFFICERS PROFILES DIRECTORATE OF COMPLIANCE AND RISK MANAGEMENT 1 Lalu Audi (Compliance Division) Fakhriati Mahruf 2 (Risk Management Desk) 3 Hj. Baiq Dien Rosana Juwita (ad. Director of Compliance and Risk Management) 97 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  99. DIRECTORATE OF COMPLIANCE AND RISK MANAGEMENT Lalu Audi (COmpliance Division) Indonesian citizen, born in Tanjung Teros, East Lombok Regency on Tuesday, September 7th, 1965, aged 55 years. He Completed his undergraduate education at the Faculty of Law, University of Mataram in 1992. Started his career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to Lalu Audi including as Head of KCP Mataram Sweta, Deputy Head of KC Bima, Branch Manager of KC Bima, Pinsub Div of HR Training and Development, Deputy General Manager of HR Management and Services, Deputy General Manager of Compliance Management & APU-PPT, and finally as General Manager of the Compliance Division. Fakhriati Mahruf (Risk Management) Indonesian citizen, born in Praya on Thursday, May 1st, 1969, aged 51. Completing her undergraduate education at the Faculty of Economic, University of Mataram in 1994. Starting a career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to Fakhriati Mahruf including as Head of Planning Sub-Division, Head of Sub Division of Financing, Deputy Manager of Praya Branch, Branch Manager of Praya Branch and most recently as Desk Head of Risk Management. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 98
  100. Company P ro fi l e s BRANCH MANAGER PROFILE Ika Ranti Hidayah (Pejanggik Branch Office) Indonesian citizen, born in Sumbawa on May 11th, 1965, aged 55 years. She completed her D3 program at the Indonesian Management Academy (AKMI) in 1986 and joined BPD NTB for the first time in 1988 through a recruitment program. Several strategic positions have been entrusted to Ika Ranti Hidayah, including Head of Head Office's Productive Credit Sub Division, Deputy General Manager of Head Office Retail & Consumer Financing, and most recently as Branch Manager of Pejanggik branch office. Lalu Syamsul Hadi (Selong Pahlawan Branch Office) Indonesian citizen, born in Sakra, East Lombok Regency on May 18th, 1966, aged 55 years. He graduated from the Bachelor of Law program at Al Azhar University Mataram in 2007 and joined BPD NTB in 1987 through the recruitment program. Several strategic positions were entrusted to Lalu Samsul Hadi, among others, Sub Branch Manager of Paok Motong sub-branch office, Branch Manager of Tanjung branch office, and most recently as Branch Manager of the Selong Pahlawan Branch Office. Lalu Saefudin (Sriwijaya Branch Office) Indonesian citizen, born in Kuripan on May 1st, 1966, 54 years old. He completed his undergraduate education at the Faculty of Economic, Institute of Economic 45 Mataram in 1999. He started a career at BPD NTB in 1988. Several strategic positions have been entrusted to Lalu Saefudin, including Head of Plampang Sub-Branch, Leader of Alas Sub-Branch, Leader of the Taliwang Branch, and most recently as Sriwijaya Branch Manager. Dedy Karyadi (Pancor Branch Office) Indonesian citizen, born in Sumbawa Besar on January 10th, 1979, aged 41 years. He completed his Master education at Gadjah Mada University Yogyakarta in 2002 and joined BPD NTB in 2004 through a recruitment program. Several strategic positions have been entrusted to Dedy Karyadi, including the Sweta Sub-Branch Manager, Deputy Branch Manager of Pancor PTC branch office, and most recently as Branch Manager of Pancor PTC branch office. Ovi Syerley Rasda (Gerung Branch Office) Indonesian citizen, born in Sumbawa Besar on February 6th, 1972, aged 49. She completed her D3 education at Mataram Management Academy in 1993 and first joined BPD NTB in 1995 through a recruitment program. Several positions that have been assigned to Ovi Syerley Rasda include Sub Branch Manager of Kediri Sub-Branch Office, Deputy Branch Manager of KC Gerung and finally Branch Manager of KC Gerung. H. Kelana (Tanjung Branch Office) Indonesian citizen, born in West Lombok on 16th, August 1965, 54 years old. He completed his undergraduate education program at the Muhammadiyah University of Mataram Faculty in 1995 and first joined BPD NTB in 1987 through a recruitment program. Several strategic positions have been entrusted to H Kelana, among others, Head of the Karang Jangkong Branch and most recently as Branch Manager of the Tanjung Branch. 99 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  101. Neneng Suryati (Praya Sudirman Branch Office) Indonesian citizen, born in Gianyar Bali on April 21st, 1971, aged 49 years old. She completed her undergraduate education program at the Faculty of Economic, Al Azhar Mataram Islamic University in 2020 and first joined BPD NTB in 1990 through a recruitment program. Several strategic positions have been entrusted to Neneng Suryati, including Sub Branch Manager of the Sharia Sub-Branch Office of Surapati, Deputy Branch Manager of Gerung branch office and most recently as Branch Manager of the Praya Sudirman Branch Office. Nining Kurniati (Sumbawa Dr. Wahidin Branch Office) Indonesian citizen, born in Sumbawa Besar on September 16th, 1965, aged 55 years. She graduated from an undergraduate program at the Faculty of Social and Political Sciences (FISPOL), Muhamadiyah University, Mataram in 1990 and joined BPD NTB for the first time in 1990 through a recruitment program. Several strategic positions have been entrusted to Nining Kurniati, including the Head of the Sharia Sub-Branch Office in Sumbawa Hasanuddin, Sub Branch Manager of the Utan Sub-Branch Office, and finally as Branch Manager of the Sumbawa Hasanuddin Branch Office. Syarif Hidayatullah (Taliwang Sudirman Branch Office) Indonesian citizen, born in Sumbawa Besar on August 11th, 1969, aged 51. He completed his undergraduate education program at the Faculty of Economic, University of Wijaya Kusuma Surabaya and first joined and joined BPD NTB in 1989 through a recruitment program. Several strategic positions have been mandated, including Sub Branch Manager of Maluk sub-branch office, Sub Branch Manager of Dompu sub-branch office, Branch Manager of Dompu and most recently as Branch Manager of Taliwang Sudirman branch office. Sirajudin (Dompu Nusantara Branch Office) Indonesian citizen, born in Bima on 5th October 1969, aged 51 years old. He completed his undergraduate education program at STIH Bima in 2005 and joined BPD NTB for the first time in 1991 through a recruitment program. Several strategic positions have been assigned to Sirajudin, including the Head of the Tente Sub-Branch Office, the Sub Branch Manager of the Pujut Sub-Branch Office, the Deputy Head of the Bima Branch Office, the Head of the Bima Branch Office, and most recently as the Branch Manager of Dompu Abdul Hafith (Bima Soekarno Hatta Branch Office) Indonesian citizen, born in Dompu on August 6th, 1974, aged 46 years. He completed his undergraduate program education at STIE YAPIS Dompu in 2008, Masters Program at the Postgraduate Program at Sumbawa University of Technology in 2020, and first joined BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to Abdul Hafith, including the Head of the Manggelewa Sub-Branch Office, Deputy Head of the Taliwang Branch Office, Deputy Head of Sumbawa Branch Office, Branch Manager of Sumbawa Branch Office, and most recently as Branch Manager of the Bima Soekarno Hatta Branch Office. Budi Santoso (Surabaya Raya Darmo Branch Office) Indonesian citizen. Born in Mataram on March 23, 1969, aged 51 years. Completed his undergraduate education at the Faculty of Economics, University of Sumbawa and first joined BPD NTB in 1989 through a recruitment program. Several strategic positions have been entrusted to Budi Santoso, including Deputy of Tanjung Sub-Branch Office, Head of Aikmel Sub-Branch Office, Deputy of the Sumbawa Branch Office, and most recently as Branch Manager of the Surabaya Branch Office. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 100
  102. Company P ro fi l e s (Standing) From left to right: Budi Santoso [Sasak traditional costume], Hj. Kelana, S.Sos [Sasak traditional costume], L. Saefudin [Sasak traditional costume] Ovy Syerley Rasda [Sasak traditional costume], Ika Ranti Hidayah [Sasak traditional costume], Neneng Suryati [Sasak traditional costume] 101 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  103. (Standing) From left to right: Dedy Karyadi [Sasak traditional costume], L. Syamsul Hadi [Sasak traditional costume], Nining Kurniati [Sumbawa traditional costume], Syarif Hidayatullah, SE [Sumbawa traditional costume], H. Sirajudin [Bima traditional costume], Abdul Hafith [Bima traditional costume] Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 102
  104. Company P ro fi l e s PROFILES AND COMPETENCY DEVELOPMENTS OF EMPLOYEES The number of Bank NTB Syariah employees as of 31 December 2020 was recorded at 1,265 people, an increase of 108 people compared to the position on 31 December 2019 of 1,157 people. Comparison of employee composition based on position level, employment status, education level, age, birth generation and work unit can be seen in the following table TOTAL EMPLOYEES BASED ON POSITION Position* 2019 2020 Male Female Total Senior Management Middle Management Officer Staff Prospective Staff (Trainee) Non-Staff 37 85 74 164 92 399 26 72 89 151 76 - 63 157 163 315 168 399 28 77 77 150 79 366 20 73 62 147 78 - 48 150 139 297 157 366 Jumlah 851 414 1.265 777 380 1.157 *Note • Senior Management consists of Employees with the positions of General Manager, Deputy General Manager, Desk Head, Branch Manager and Deputy Branch Manager • Middle Management consists of Employees with the position of Supporting Branch Manager, Deputy Supporting Branch Manager, Manager, Auditor and Supervisor • Officers consist of Employees with the position of Analyst, Dealer, Juris and Branch Internal • Control Staff consists of Employees with Permanent Employee status for Customer Service, Teller and Administrative Assistant positions, and Outsourcing for Sales Funding, Call Center and • equivalent positions Prospective Staff (Trainees) are Prospective Employees who are undergoing a period of • (person) education, on job training or a trial period Non-Staff consists of Employees with Permanent and Outsourcing status for the position of Male Female Total Graph of Number of Employees Based on their Position Senior Management Middle Management Officer 63 157 163 315 Staff Prospective Staff (Trainee) Non-Staff 168 399 Pramubhakti (waitress/waiter), Driver, and Security. 103 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  105. TOTAL EMPLOYEES BASED ON STAFFING STATUS Employee Status (person) 2019 2020 Male Female Total Male Female Total Permanent Contract Trainee 456 11 92 325 5 76 781 16 168 405 3 78 261 79 666 3 157 Sub Total 559 406 965 486 340 826 Outsourcing 292 8 300 291 40 331 Total 851 414 1.265 777 380 1.157 Graph of Number of Employees Based on their Status 456 Permanent 325 11 Contract Male Female 5 92 76 Trainee 292 8 Outsourcing TOTAL EMPLOYEES BASED ON EDUCATIONAL LEVEL Educational Level (person) 2019 2020 Male Female Total Male Female Total Doctoral Master Bachelor Diploma Primary-Secondary 1 15 388 22 425 12 326 35 41 1 27 714 57 466 1 9 355 17 395 10 298 26 46 1 19 653 43 441 Total 851 414 1.265 777 380 1.157 Graph of Number of Employees Based on their Educational Level Bachelor 388 326 22 35 Diploma Master 15 12 425 41 Primary Secondary Doctoral 1 Male Female TOTAL EMPLOYEES BASED ON AGE Age (person) 2019 2020 Male Female Total Male Female Total <25 25 – 30 31 – 35 36 – 40 41 – 45 > 45 79 201 161 140 115 155 61 137 97 44 22 53 140 338 258 184 137 208 63 199 160 123 89 143 62 133 66 47 14 58 125 332 226 170 103 201 Total 851 414 1.265 777 380 1.157 Graph of Number of Employees Based on their Age <25 79 61 25-30 201 137 31-35 161 97 Spirit of Amanah, Optimistic and Growth in Sustainable Business Male Female 140 44 36-40 115 22 41-45 155 53 >45 PT Bank NTB Syariah. 2020 Annual Report 104
  106. Company P ro fi l e s TOTAL EMPLOYEES BASED ON BIRTH GENERATION Generation Baby Boomers X Generation Y Generation (Millennial) Z Generation Alpha Tahun Kelahiran (person) 2019 2020 Male 1946-1964 1965-1980 1981-1994 1995-2010 >2010 Total Female Total Male Female Total 5 265 502 79 - 2 73 278 61 - 7 338 780 140 - 11 269 434 63 - 7 86 224 63 - 18 355 658 126 - 851 414 1.265 777 380 1.157 Graph of Number of Employees Based on their Birth Generation Baby Boomers 5 2 262 Generasi X 73 Male Female 502 278 Generasi Y 79 61 Generasi Z TOTAL EMPLOYEES BASED ON WORK UNITS With the promotion, rotation, and retirement of employees during 2020, the composition of employees per directorate is illustrated as the following table: (person) Work Unit 2019 2020 Male Female Total Head Office Branch Office Supporting Branch Office 141 353 357 81 203 130 222 556 487 Total 851 414 1.265 Male Female Total 125 343 309 73 183 124 198 526 433 777 380 1.157 Graph of Number of Employees Based on their Work Unit Head Office 141 81 Branch Office 353 203 105 PT Bank NTB Syariah. 2020 Annual Report 357 130 Male S. Branch Office Female Spirit of Amanah, Optimistic and Growth in Sustainable Business
  107. EMPLOYEE COMPETENCY DEVELOPMENT Realizing the important role of Human Resources (SDI) in developing the banking business, Bank NTB Syariah provides full support and opportunities for each individual to develop themselves optimally. Throughout 2020 the Bank has consistently carried out employee competency development through training programs both carried out internally (In House Training) and in collaboration with external parties (Public Training). The education and training program includes technical skills and soft skills, including: Risk Management Certification and Refreshment, Bank Operations/Standard Operating Procedures (SOP), Financing, Retail TPF Collection Strategy, Information Technology, AML-CFT Training, Compliance, Induction Program, Product Knowledge, Leadership, as well as various workshops, seminars and other outreach. The realization of the implementation of training and development for Bank NTB Syariah during 2020 can be seen in the following table: a. The implementation of in-house training during 2020. A total of 31 activities were conducted with 1,314 participants. No Type of Education/ Training Job Type Partici pants PuIDRose Organizers 1. PDPS Activities and Employee Candidate Training Trainee 137 January 20th, 2020 SDI Division 2. Dissemination of Internal Regulations for KEP & MJR Division Top Management, Middle Management, Lower Management 33 March 13th, 2020 KEP Division, MJR Desk 3. Socialization of MMQ Contract Financing Technical Guidelines Top Management, Middle Management, Lower Management 46 May 5th, 2020 Financing Division 4. Dissemination of Internal Provisions KEP-MJR 2020 Division Middle Management, Lower Management 68 June 23rd-26th and 29th, 2020 KEP & MJR Division 5. Dissemination of FOS Lower Management, Middle Management 25 July 17th, 2020 Financing Division 6. Quarterly Performance Evaluation III/2020 Middle Management 49 July 23rd, 2020 JKE Division, DNR Division 7. Public Lecture in response to STIE TAZKIA student internships Top Management, Middle Management - July 20th -24th, 2020 Bank NTB Syariah 8. Assessment of Prospective Supervisors and analyst PT.Bank NTB Syariah Lower Management 37 July 25th, 2020 Bank NTB Syariah 9. Selection for Master Program ocollavoration of PT Bank NTB Syariah, UIN Mataram and, UTS Middle Management, Lower Management 107 August 8th-9th, 2020 Bank NTB Syariah 10. Government employees (ASN) Merdeka Marketing Program Dissemination Middle Management, Lower Management 130 August 19th, 2020 PBY Division 11. Bussines Review Year of 2019 Top Management, Middle Management, Lower Management - August 26th, 2020 Bank NTB Syariah 12. Performance Evaluation NPF III/2020 Lower Management, Midle Management 18 August 27th, 2020 JKE Division, PBY Division, APP Desk 13. Dissemination of Marketing Program “Gelegar Hijrah” Lower Management, Midle Management 130 August 28th, 2020 PBY Division 14. Coaching Clinic JKE Division Top Management, Middle Management, Lower Management 28 August 31stSeptember 2nd 2020 JKE Division Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 106
  108. Company P ro fi l e s Type of Education/ Training Job Type 15. STIE TAZKIA Internship Program Report Presentation Top Management, Middle Management, - September 10th, 2020 Bank NTB Syariah 16. Internship Program Briefing for IAIH NW Pancor and University of Muhammadiyah Yogyakarta Top Management, Middle Management - September 11th, 2020 Bank NTB Syariah 17. Closing of STIE TAZKIA Student Internship Top Management, Middle Management - September 11th, 2020 Bank NTB Syariah 18. General Lecture/Internship Program Desk for Students from IAIH Pancor and University of Muhammadiyah Yogyakarta Top Management, Middle Management 114 September 14th-18th, 2020 Bank NTB Syariah 19. General Banking Training for Prospective Employees of PT Bank NTB Syariah - 51 September 21st-25th, 2020 Bank NTB Syariah 20. Financing with PEN Program Insurance Lower Management, Middle Management 90 September 21st, 2020 PBY Division 21. MultipuIDRose SOP socialization Lower Management, Middle Management 130 September 21st, 2020 PBY Division 22. APU - PPT application socialization Lower Management, Middle Management 5 September 28th, 2020 Compliance Division 23. Islamic Lecture for PT Bank NTB Syariah Employees Top Management, Middle Management, Lower Management 24. Internship Program for students of NW Pancor dan Muhammadiyah University of Mataram Top Management, Middle Management, Lower Management 25 October 27th, 2020 REN Division 25. Web Seminar Traditional Banks VS Challenger Banks In The Era Of Open Banking Top Management 1 September 29th, 2020 Main Office 26. Dissemination of Phase II Online APU-PPT Report of 2020 Top Management, Middle Management, Lower Management 76 November 16th-18th, 2020 KEP Division 27. Dissemination of SOPs for Financing Restructuring and Monitoring of NPF Financing Top Management, Middle Management, Lower Management November 16th-18th, 2020 APP Desk 28. Dissemination of Tabungan Tambora Rencana Top Management, Middle Management, Lower Management November 23rd-25th, 2020 DNR Division 29. Refreshment of Management of CoIDRorate and Local Government Deposits Top Management, Middle Management, Lower Management 89 December 18th, 2020 TRS Division 30. Employee Master Degree Program Middle Management 1 No Total 107 PT Bank NTB Syariah. 2020 Annual Report Partici pants PuIDRose Organizers Main Office SDI Division 1.314 Spirit of Amanah, Optimistic and Growth in Sustainable Business
  109. b . No The realization of public training during 2020 with a total of 107 and 1,342 participants. Type of Education/ Training Job Type Partici pants PuIDRose Organizers 1. Basic Level Training & Treasury Certification Exam 2020 Top Management, Middle Management 2 January 17th, 2020 IIGMA 2. Treasury Dealer Competency Test Top Management, Middle Management 2 January 24th, 2020 LPPS 3. ASBANDA Training Preparation of 2019 Annual CoIDRorate Income Tax Return, Sharing PPAP and the Impact of PSAK 71 and & 73 on BPKH Tax Liabilities Middle Management, Lower Management 2 January 28th, 2020 Asbanda 4. Competency Improvement of IslamicBank Account Officers and LKS in financing analysist Middle Management, Lower Management 4 February 3rd, 2020 Iqtishad Consulting 5. Mid-level Environmental Analyst Training 2020 Middle Management, Lower Management 2 February 10th, 2020 OJK 6. National Seminar on the role of electronic transactions Top Management 1 February 10th, 2020 ARTAJASA 7. Provision of Materials & Level 1 Compliance Certification Tests in 2020 Top Management 2 February 11th, 2020 FKDKP 8. General Financing Training for Sharia Financial Institutions (LKS) and Socialization of New SOPs for Productive Financing Top Management, Middle Management, Lower Management 33 February 10th, 2020 Fajar Wahyudi 9. IT Competency Improvement Training, Especially for Network Administrator (Basic MTCNA) Middle Management, Lower Management 2 February 17th, 2020 PT Citraweb Solusi Teknologi 10. Socialization of the Alternate BI-ETP System and Discussion on the Implementation of Monetary Evaluation 2019 and Monetary Operations Strategy 2019 Lower Management 1 February 13th, 2020 Bank Indonesia 11. Implementation of Certification Refreshment, Plenary Meeting and Gathering Top Management, Lower Management 3 February 20th, 2020 IIGMA 12. CSR Workshop Lower Management 3 February 18th, 2020 LMKN 13. Invitation to the BPDSI National Seminar and Simpeda Savings Drawing Lottery Top Management, Middle Management 6 February 21st, 2020 ASBANDA 14. Basic / Intermediate Level Treasury Dealer Certification Training Top Management, Lower Management 3 February 21st, 2020 IIGMA 15. Level I, II and III Risk Management Certification Training and Equipments Top Management, Middle Management, Lower Management 134 February 24th, 2020 Solusi Bankir 16. Invitation to the Declaration of the 2020 MPN System Integrity Zone and Socialization Lower Management 1 February 26th, 2020 KPPN 17. Ujian Kompetensi Sertifikasi Treasury Top Management 2 February 28th-29th, 2020 IIGMA 18. Workshop on Interconnection of CMS / SP2D Online Version 4 with SIMDA Finance Middle Management, Lower Management 3 March 3rd, 2020 BKP PROV Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 108
  110. Company P ro fi l e s Type of Education/ Training No Job Type Partici pants PuIDRose Organizers 19. Advance Level Training and Treasury Certification Exam Top Management 1 March 6th, 2020 IIGMA 20. Intermediate Level Treasury Dealer Certification Training and Examination Lower Management 1 March 6th, 2020 IIGMA, LSPP 21. National Seminar on strategies to improve the quality of human resources in the field of payment systems and rupiah currency management Top Management, Lower Management 2 March 8th, 2020 Bank Indonesia 22. Taxation Workshop on Implementation of PSAK 71, 72 and PSAK 73 Middle Management 2 March 9th, 2020 ASBANDA 23. Material Provision of Level 5 Risk Management Top Management 1 March 11th, 2020 Solusi Bankir 24. Level 5 Risk Management Exam Top Management 1 March 14th, 2020 LSPP 25. Treasury Dealer-Basic Syariah Certification Exam Middle Management, Lower Management 2 March 13th, 2020 LSPP 26. Competency Test in the Field of Risk Management Level I, II and III Top Management, Middle Management, Lower Management 134 March 7th, 2020 LSPP 27. Assessment of Prospective Supervisors and Analysts Lower Management 63 March 9th, 2020 LPPI 28. Socialization of Health Talk Corona Virus (Covid-19) Top Management, Middle Management, Lower Management 50 March 20th, 2020 RS Risa Sentra Medika 29. Al-Qur'an Recitation Training End of Year Liquidity Provision Workshop Top Management, Middle Management, Lower Management 30 March 31st, 2020 Husnul Hadi, Rina Rahmatina 30. Treasury Certification Exam in the Advance Level of Treasury Dealer Top Management 2 March 31st, 2020 ASBANDA 31. Refreshment of Level 1 and 2 Risk Management Certification Top Management 1 April 18th, 2020 LSPP 32. Training / Provision for Level 4 Risk Management Certification and Level 2 Refreshment Top Management, Middle Management 16 April 22nd, 2020 Solusi Bankir 33. Basic Sharia Banking Training for Commissioners and DPS Candidates Top Management, Middle Management 4 April 28th, 2020 Solusi Bankir 34. Level 1 Risk Management Certification Training for Commissioners candidates Top Management 4 May 05th - 09th, 2020 LPPI 35. Risk Management Workshop on Sharia Banks Top Management 3 May 11th -12th, 2020 Solusi Bankir 36. Webinar on Resilience and Sharia Business Strategies to Face the Impact of Covid - 19 Top Management 6 May 13th, 2020 Ikatan Akuntan Indonesia 37. Webinar on Handling Non-Performing Financing and Banking Credit Restructuring (Impact of Covid-19) Top Management, Middle Management 8 May 14th, 2020 LPPI 38. Level 4 Risk Management Certification Exam Top Management, 3 May 18th, 2020 Halal Ventures Indonesia 109 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  111. No Type of Education / Training Job Type Partici pants PuIDRose Organizers 39. Level 4 Risk Management Certification Exam Top Management 3 June 06th, 2020 LSPP 40. Sharia Compliance Fulfillment Webinar Workshop in the preparation of sharia financing contract documents Middle Management, Lower Management 3 June 11th, 2020 Medina Consulting 41. Online Education and Training for General Management of Pension Funds Top Management 2 June 10th-11th, 2020 ADPI 42. Online Pension Fund General Management Certification Exam (MUDP) Top Management 2 June 12th, 2020 LSPDP 43. Musyarakah Mutanaqisah (MMQ) Agreement Webinar Workshop: Powerful Sharia Financing Schemes in the New Normal Period Middle Management, Lower Management 3 June 20th, 2020 Medina Consulting 44. Special provisions for Banking Risk Management Certification Level 2 Top Management 1 June 11th-12th, 2020 Solusi Bankir 45. Level 1 Commissioner Risk Management Certification Exam Top Management 3 June 20th, 2020 LSPP 46. Al-Qur'an Recitation Training Top Management, Middle Management, Lower Management 15 April 1st – 15th, 2020 Rina Rahmatina 47. Competency Improvement of CoIDRorate Human Resources Entering the New Normal Era Top Management, Middle Management 5 July 2nd, 2020 Econand 48. Level 2 Risk Management Certification Exam Middle Management 1 July 4th, 2020 LSPP 49. Level 1 Risk Management Certification Exam Calon Komisaris 1 July 4th, 2020 LSPP 50. Webinar Analyzing Team Performance Conditions and Determining New Covid-19 Billing Strategies and Methods of Evaluation Middle Management 3 July 4th, 2020 M-Knows Consulting 51. Special provisions for Banking Risk Management Certification Level 3 Middle Management 1 July 10th-11th, 2020 Solusi Bankir 52. Level 3 Risk Management Certification Exam Middle Management 1 July 14th, 2020 LSPP 53. Webinar Treasury Management dan Sharia Asset Liability Management (SHALMA) Top Management, Middle Management 4 July 28th, 2020 Medina Consulting 54. Webinar Treasury Management and Sharia Asset Liability Management (SHALMA) Top Management, Middle Management 2 July 29th, 2020 Bank Indonesia 55. Level 4 Risk Management Certification Exam Middle Management 1 July 30th, 2020 LSPP 56. RUA LAPSPI for Fiscal Year 2019 Middle Management 1 July 31tst, 2020 LAPSPI 57. Webinar on the Concept of a Guarantee Binding Contract in Sharia Financing Middle Management, Lower Management 3 August 6th, 2020 Mediana Consulting Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 110
  112. Company P ro fi l e s Type of Education/ Training No Job Type Partici pants PuIDRose Organizers 58. BPD SI National Seminar and Simpeda Savings Drawing Lottery Top Management, Middle Management 6 August 11th, 2020 ASBANDA 59. Sharia Supervisory Competency Certification Exam Calon DPS 1 September 1st, 2020 DSN-MUI 60. Sustainable Finance Action Plan (RAKB) Training Phase I Top Management, Middle Management 40 September 8th, 2020 Trisakti Sustainability Center 61. Level 1 Batch 1 and Level 2 Batch 1 Risk Management Certification Training Middle Management, Lower Management 91 September 7th-8th, 2020 Solusi Bankir 62. Risk Management Certification Training Level 2 Batch 2 Middle Management 48 September 9th-10th, 2020 Solusi Bankir 63. Batch IV Suspicious Financial Identification Training 2020 Middle Management 5 September 14th-15th, 2020 FKDKP 64. Level 3 Risk Management Certification Training Top Management, Middle Management 9 September 14th-15th, 2020 Solusi Bankir 65. Level 4 Risk Management Certification Training Top Management 3 September 16th-17th, 2020 Solusi Bankir 66. Sustainable Finance Action Plan (RAKB) Phase II Training Middle Management, Lower Management 40 September 17th, 2020 Trisakti Sustainability Center 67. Level 1 and Level 2 Risk Management Certification Examinations Middle Management, Lower Management 137 September 19th, 2020 LSPP 68. Level 3 Risk Management Certification Exam Top Management, Middle Management 9 September 19th, 2020 LSPP 69. Sharia Treasury Management and Sharia Asset Liability Management (SHALMA) Top Management 10 September 22nd, 2020 Medina Consulting 70. FKDKP Workshop on Understanding the Provisions related to Data Reporting of Customer Based Deposit Insurance (Single Customer View) PLPS No. 05 of 2019 Top Management, Middle Management 2 September 24rd, 2020 FKDKP 71. Dissemination of Plans for Implementing New Instruments for OMS Liquidity Injection Middle Management 1 September 23rd, 2020 Bank Indonesia 72. Web Seminar Traditional Banks VS Challenger Banks In The Era Of Open Banking Top Management 1 September 29th, 2020 Infobank 73. Webinar, Questions and Answers on the Implementation of Musyatakah Mutanaqishah (MMQ) Financing and Its Application to 15 Comprehensive Sharia Bank Products Middle Management, Lower Management 2 October 14th, 2020 Istishad Consulting 74. Sharia Line Facility Financing Webinar Middle Management, Lower Management 2 October 21st, 2020 Istishad Consulting 75. Distance Certification Training-PSJJ (Virtual Training) Candidates for Director I and Director II, Candidates for the Board of Commissioners of BPR BPR Batch 2 Bandung and Batch 5 in the DPD Region of Perbarindo, West Java Top Management, Middle Management 6 October 12th, 2020 DPD PERBARINDO JABAR 111 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  113. No Type of Education / Training Job Type Partici pants PuIDRose Organizers 76. Financing of Provision of Level 1 Compliance Certification Test Lower Management 2 4 Oktober 2020 FKDKP 77. Training Islamic Economics Summer School 2020 Middle Management 1 17 Oktober s.d 01 November 2020 AVRIST MANAGEMENT 78. Training Islamic Economics Summer School 2020 Middle Management, Lower Management 70 13-14 Oktober 2020 M-Knows Consulting 79. Webtraining Graphonomy & Graphology Top Management 3 17 Oktober 2020 LSPP 80. Level 4 Banking Risk Management Competency Test Top Management, Middle Management 7 17 Oktober 2020 Medina Consulting 81. Webinar : Avoiding Troubled Murabahah Financing Structures Middle Management, Lower Management 3 12 Oktober 2020 Bank Indonesia 82. BI Antasena Application Training Top Management, Middle Management 5 10-12 November 2020 CERTIF 83. Certification Competency Test for Candidates for Director Level 2 DPD Perbarindo West Java Top Management, Middle Management, Lower Management 16 10-November-2020 Trisakti Sustainability Center Sustainability Report Workshop (SR) Ketaspenan Training / Office Channeling Training at PT. Taspen (Persero) Mataram Top Management, Middle Management, Lower Management 88 21-November-2020 85. Individual CKPN Calculation Training Top Management, Middle Management, Lower Management 20 21-November 2020 86. End of Year Administration Socialization and Acceptance Guidelines Top Management, Middle Management 6 4 November 2020 Dissemination of Strengthening the Implementation of the Anti-Bribery Management System at PT PLN (Persero) Top Management, Middle Management 6 88. Evaluation of Rupiah Payment at Bank Indonesia Top Management, Middle Management 6 6 November 2020 Bank Indonesia 89. Sustainable Front Office, Middle Office dan Back Office Top Management, Middle Management 6 12-13 November 2020 BRI 90. Paritrana Award 2020 Top Management, Middle Management 6 16 November 2020 BPJS TK 91. FGD Evaluation of the Implementation of Sharia Treasury Certification Top Management, Middle Management 6 16 November 2020 Bank Indonesia 92. Proactive Treasury & Asset Liability Management Top Management, Middle Management 6 26 November 2020 Anabatic Solusi Digital 93. Financial Integrity Rating on Money Laundering and Terrorist Financing (FIR on ML / TF) Dissemination Training for Commercial Banks in 2020 Top Management 1 26-27 November 2020 PPATK 94. Banking Readiness Webinar for the 2020 Regional Head General Election Top Management, Middle Management 6 16 November 2020 PPATK 84. 87. Spirit of Amanah, Optimistic and Growth in Sustainable Business 5 November 2020 PT Taspen Persero Ahmad Fadri Malik Dirjen Penerimaan Negara Kementerian Keuangan RI PT PLN (Persero) PT Bank NTB Syariah. 2020 Annual Report 112
  114. Company P ro fi l e s Type of Education/ Training No Job Type Partici pants PuIDRose Organizers 95. Webinar On AML/CFT Related Virtual Asset Top Management 1 November 12th, 2020 PPATK 96. Dissemination of Leverage Ratio and KPMM Data Structure for Commercial Bank Operational Risk RWA Middle Management 1 November 9th, 2020 OJK 97. Socialization of Data Structure for Commercial Bank Business Report Plans and Student Savings Middle Management 2 November 24th, 2020 OJK 98. Treasury Dealer Certification Training Top Managemeent 1 November 28th, 2020 IIGMA 99. Socialization of Micro Waqf Bank Top Management, Middle Management 16 December 7th, 2020 Imam Teguh Saptono 100. Competency Test for BPR Qualification Director 2 Top Management, Middle Management 5 December 10th-12th, 2020 CERTIF 101. Reconciliation of Hajj Pilgrimage Data Middle Management 2 December 8th, 2020 Kemenag RI 102. Technical Implementation of Dealing Room Transactions Placement of funds at the BPD Top Management, Middle Management 7 December 2nd, 2020 PKN 103. End of Year Liquidity FGD Top Management, Middle Management 7 December 2nd, 2020 Bank Indonesia 104. Money Market Development Blue Print 2025 Top Management, Middle Management 7 December 14th, 2020 Bank Indonesia 105. Dissemination of Provisions Regarding Short-Term Liquidity Financing for Commercial Banks Top Management, Middle Management 7 December 14th, 2020 Bank Indonesia 106. Socialization of Public Offerings and IPO to BPD Top Management, Middle Management 12 December 17th, 2020 OJK 107. FGD Trial Tax Deposit to the State Treasury integrated with the Regional Expenditure Fund Top Management, Middle Management 7 December 17th, 2020 Kementerian Total 1.342 COMPETENCY DEVELOPMENT COSTS Bank NTB Syariah employee competency development is carried out through internal training programs as well as in collaboration with external parties. Throughout 2020, the Bank has spent the amount of IDR3,005,906,938, with the following details: Training Type No 2020 1 Internal IDR 935.931.400 2 Eksternal IDR 2.069.975.538 IDR 3.005.906.938 Total 113 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  115. STRUCTURE AND COMPOSITION OF SHAREHOLDERS INFORMATION REGARDING MAJOR SHAREHOLDERS Bank NTB Syariah is a Regional Owned EnteIDRrise with majority shares owned by all local governments . The composition of the majority paid-up capital as of December 31st, 2020 owned by NTB Provincial Government of IDR334,216 million or 43.13% and Regencies / Cities Governments throughout NTB of IDR 440,684 million or 56.87. The composition of shares for each Regional Government is described in the following table: (dalam jutaan rupiah) No Realization Description 2019 2020 Share (%) 1. NTB Province 334,216 334,216 43.13% 2. Sumbawa Regency 74,650 74,650 9.63% 3. East Lombok Regency 75,231 75,231 9.71% 4. Dompu Regency 57,968 57,968 7.48% 5. Central Lombok Regency 60,000 60,000 7.74% 6. West Sumbawa Regency 39,643 39,643 5.12% 7. West Lombok Regency 26,087 26,087 3.37% 8. Bima Regency 37,918 37,918 4.89% 9. North Lombok Regency 32,022 32,022 4.13% 10. Mataram City 27,097 27,097 3.50% 11. Bima City 10,068 10,068 1.30% 774,900 774,900 100% Total SHARE OWNERSHIP STRUCTURE The last change in the Authorized Capital of Bank NTB Syariah was carried out in accordance with Deed No. 5 dated August 21st, 2018, to IDR2,500,000,000,000 (two trillion five hundred billion rupiah) divided into 250,000,000 (two hundred and fifty million) shares. As of December 31st, 2020, the amount of additional paid-up capital is IDR774,899 million, with details of Central Lombok District of IDR7,150 million, West Sumbawa District of IDR 1,100 million, Bima District of IDR4,500 million, Mataram City of IDR4,000 million, and the City of Bima amounting to IDR 500 million, bringing the total to IDR17,250 million. The development of the authorized capital of Bank NTB Syariah is as follows Year The Legal Basis Authorized Capital 2018 Deed No. 5 dated August 21, 2018, the conversion to BUS 2,500,000,000,000 2016 Notarial Deed No. 14 dated 30 November 2016 2,500,000,000,000 2011 Deed No.53 of December 9, 2011 1,000,000,000,000 2008 Deed No. 03 dated March 3, 2008 250,000,000,000 1999 Deed No.22 dated April 30, 1999 100,000,000,000 BOARD OF COMMISSIONERS AND DIRECTORS SHARE OWNERSHIP As of December 31st, 2020, the Board of Commissioners and Directors of Bank NTB Syariah do not own shares in Bank NTB Syariah because because there is no share ownership option other than the West Nusa Tenggara Regional Government LESS THAN 5% OF COMMUNITY SHARE OWNERSHIP As of December 31, 2020, Bank NTB Syariah is a closed company where share ownership is only by the Regional Government, in other words no shares are sold or owned by individual or community Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 114
  116. Company P ro fi l e s IDENTITAS PEMEGANG SAHAM West Nusa Tenggara Province West Nusa Tenggara consists of Lombok Island and Sumbawa Island with an area of 20,153.15 km2. Located between 115 ° 46 '- 119 ° 5' East Longitude and 8 ° 10 '- 9 ° g 5' South Latitude. The NTB Province as a government consists of 10 (ten) City/Regencies and there are three major tribes namely Sasak, Samawa and Mbojo. The total population of 5.2 million people where 95% are followers of Islam with the number of mosques as places of worship that are very widely spread so that NTB is known as the "Island with Thousand Mosques". Shareholding 43.13% The NTB Province was officially established as part of the Province in Indonesia through Law Number 64 of 1958 on August 14, 1958 and December 17, 1958 was designated as the birthday of the Province of West Nusa Tenggara. The elected governor in each period will become the Shareholder of Bank NTB. IDR334,216 million Governor DR. Zulkiflimansyah SE, M.Sc Deputy Governor Dr. Ir. Hj. Sitti Rohmi Djalilah, M.Pd ssfgbg Mataram City Shareholding 3.50% IDR27,097 million Mataram City is the capital of West Nusa Tenggara Province which has an area of 61.30 km2. Located between the District of West Lombok and the Lombok Strait at position 080 33 'LS - 080 38' LS and 1160 04 'BT - 1160 10' BT. Administratively, Mataram City consists of 6 (six) Districts, namely Ampenan, Sekarbela, Mataram, Selaparang, Cakranegara, and Sandubaya Districts with a population of 484.19 thousand inhabitants of which 80% are Muslim residents. The city of Mataram was inaugurated on 31 August 1993 as the capital of the province of West Nusa Tenggara. Aside from being a center of government, the City of Mataram is also a center of tourist travel on the island of Lombok which was developed into a tourist city. Mayor H. Ahyar Abduh Deputy Mayor Mohan Roliskana ssfgbg North Lombok Regency Shareholding 4.13% IDR32,022 million North Lombok Regency is one of 10 (ten) Regencies/Cities in West Nusa Tenggara Province, whose position is located in the northern part of Lombok Island with coordinates between 080 21 '42 "South Latitude and 1160 09" 54 "East Longitude. North Lombok Regency has a land area of 809.53 Km2 and 594.71 Km2 sea waters. Administratively, North Lombok Regency is divided into 5 (five) Districts, namely Pemenang, Tanjung, Gangga, Kayangan, and Bayan Districts. The size of the territorial waters which is almost comparable to the land area, influences the governance policies in each sub-district including land and sea area management policies with a mission that includes improving the welfare of the community based on superior potential in the respective region (each sub-district). North Lombok Regency was formed based on Law No. 26/2008 which was a division of West Lombok Regency which on July 21, 2008 was designated as the birthday of North Lombok Regency. This area has a number of tourist objects that are quite well known in foreign countries, such as Gili Air, Gili Meno, Gili Trawangan, Sendang Gila Waterfall (Senaru Village, Bayan), and the beauty of Lake Segara Anak on the slopes of Mount Rinjani. Regent Dr. H. Najmul Akhyar, S.H. M.H Deputy Regent Sarifuddin, S.H ssfgbg 115 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  117. West Lombok Regency West Lombok Regency is a regency in West Nusa Tenggara Province which is geographically located between 1150 46 '- 1160 20' East Longitude, and 80 25 'to 80 55' South Latitude with an area of 862.6 Km2. West Lombok Regency consists of 15 districts, namely Bayan, Ganges, Pemenang, Kayangan, Gunung Sari, Batu Layar, Narmada, Lingsar, Labuapi, Kediri, Gerung, Sheet, and Central Sekotong. The plantation sector in West Lombok Regency is a significant contribution to the community's economy. Coconut, coffee, cloves, cashew, vanilla, cotton, cotton, cocoa, tobacco, tamarind and areca nut are some of the types of plantation crops produced in the district of West Lombok. Based on Law Number 69 of 1958, precisely on April 17, 1959 was designated as the anniversary of West Lombok Regency. juta Shareholding 3.37% IDR26,087 million Regent H. Fauzan Khalid, S.Ag,M. Si Deputy Regent Hj. Sumiatun ssfgbg Central Lombok Regency Central Lombok Regency is a level II area in West Nusa Tenggara Province which is located at position 820 7 '- 80 30' South Latitude and 1160 10 '- 1160 30' East Longitude, stretching from the foot of Mount Rinjani north to the coast of Kuta at the south with several small islands around it. There are 12 Subdistricts that enter the Central Lombok Regency namely Batukliang, North Batukliang, Janapria, Jonggat, Kopang, Praya, West Praya, Southwest Praya, Middle Praya, East Praya, Pringgarata, and Pujut Districts. Central Lombok Regency has an area of 1,208.39 km2 with a population of 922.08 thousand people which has considerable development potential, especially in the agriculture and tourism sectors. Central Lombok Regency was formed into an Autonomous Region based on Law Number 69 of 1958 juta on August 14, 1958. Geographically Central Lombok Regency has several mainstay which was ratified attractions, namely Tanjung Aan Beach, Benang Kelambu Waterfall, Sade Village, Craft Center Traditional Weaving, Selong Belanak Beach, and Kuta Beach. Regent H.Moh Suhaili FT, SH Shareholding 7.74% IDR60,000 million Deputy Regent Lalu Pathul Bahri, S.IP ssfgbg East Lombok Regency East Lombok Regency is a level II area in the province of West Nusa Tenggara which is geographically located between 1160 46 '- 1170 20' East Longitude and 80 00 '- 90 00' South Latitude with an area of 2,679.88 km2. East Lombok regency area is divided into 21 districts including Aikmel, Jerowaru, Keruak, Labuhan Haji, Lenek, Masbagik, Montong Gading, Pringgabaya, Pringgasela, West Sakra, East Sakra, Sakra, Sambelia, Selong, Sembalun, Sikur, Suela, Sukamulia, Suralaga, Terara and Wanasaba Districts. The northern region of this Regency is a fertile agricultural area included in the slope area of Mount Rinjani with a height of 3,726 m, coupled with a variety of potential sea owned. East Lombok Regency was legally formed on August 14, 1958 based on Law Number 64 of 1958 and Law Number 69 of 1958. The capital of this region is the City of Selong. Shareholding 9.71% IDR75,231 million Regent Drs. H. M. Sukiman Azmi, MM Deputy Regent H. Rumaksi SJ, SH ssfgbg Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 116
  118. Company P ro fi l e s West Sumbawa Regency West Sumbawa Regency is a Regency in West Nusa Tenggara Province which is geographically located between 1160 42 '- 1170 05' East Longitude and 080 08 '- 090 07' South Latitude with an area of 1,849.02 km2. In its development the administrative area of West Sumbawa Regency has been divided into 8 (eight) districts, namely Poto Tano, Seteluk, Brang rea, Brang Ene, Taliwang, Jereweh, Maluk, and Sekongkang Districts. Trade activities are the leading sector driving the community's economy in West Sumbawa Regency. Shareholding 5.12% West Sumbawa Regency was officially established on December 18, 2003 based on Law Number 30 of 2003 concerning the Establishment of the West Sumbawa Regency in West Nusa Tenggara Province. IDR39,643 million Regent Dr. Ir. H. W. Musyafirin, MM Deputy Regent Fud Syaifuddin, ST ssfgbg Sumbawa Regency Sumbawa Regency is one of the Regencies in the Province of West Nusa Tenggara which is located at position 1160 42 '- 1180 22' East Longitude and 80 8 '- 90 7' South Latitude with an area of 6,643.98 Km2. Administratively, the Sumbawa Regency region consists of 23 Subdistricts namely Lunyuk, Alas, Utan, Batu Lanteh, Moyo Hilir, Moyo Hulu, Ropang, Lape, Lape, Plampang, Empang, West Alas, Labuhan Badas, Labangka, Buer, Rhee, Unter Iwes, Unter North Moyo, Maronge, Tarano, Lopok, Lenangguar, and lantung District. The economic potentials that sustain the economy of the people of Sumbawa Regency are the Agriculture Sector, the Livestock Sector, and the Tourism Sector. Shareholding 9.63% Sumbawa Regency was officially established on January 22, 1959 based on Law Number 69 of 1958. IDR74,650 million Regent H.M. Husni Jibril, B.Sc Deputy Regent Drs. H. Mahmud Abdullah ssfgbg Dompu Regency Shareholding 7.48% IDR57,968 million Dompu Regency is a district in the Province of West Nusa Tenggara Province which is geographically located at position 117 42 '- 118 30' East Longitude and 08 06 '- 09 05' South Latitude with an area of 2,324.55 Km2. Administratively, the area of Dompu Regency is divided into 7 (seven) Districts, namely Hu'u, Pajo, Dompu, Woja, Kilo, Woja, Kempo, Manggalewa, and Pekat Districts. The Agriculture Sector is the leading sector supporting the economy of the people of Dompu Regency. The anniversary of Dompu Regency was set on April 11, 1815 based on Local Regulation No. 18 dated June 19, 2004 against a backdrop of natural phenomena namely the eruption of the highest mountain on Sumbawa Island, Mount Tambora in 1815. The Regency is located in the central part of Sumbawa Island and is famous as a producer of wild horse milk and honey Regent Drs.H.Bambang M.Yasin Deputy Regent Arifuddin, SH ssfgbg 117 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  119. Bima Regency Bima Regency is a Regency in West Nusa Tenggara Province which is geographically located at coordinates 1170 40 '- 1190 10' South Latitude and 080 08 '- 080 - 57' East Longitude with an area of 3,405.63 Km2. Administratively, Bima Regency consists of 18 Subdistricts namely Woha, Wera, Wawo, Tambora, Soromandi, Sape, Sanggar, Parado, Palibelo, Monta, Mada Pangga, Langgudu, Lambu, Lambitu, Dongitu, Bolo, Belo and Ambalawi Districts. The regency, which is located at the eastern end of Sumbawa Island, has quite good economic potential, starting from the natural, agricultural, marine and forestry potential and trade which has succeeded in driving regional economic growth. 4.89% Over time, the Regency of Bima also experienced development in a more advanced direction. With the existence of broad and responsible autonomy authority granted by the central government in the framework of regional autonomy as mandated in Law No. 22 of 1999 and revised to Law No.33 of 2004. IDR37,918 Regent Hj. Indah Dhamayanti Putri Shareholding million Deputy Regent Drs. Dahlan M. Noer ssfgbg Bima City Bima City is an Autonomous City located in West Nusa Tenggara Province bordering Bima Regency. Geographically, the City of Bima is located at positions 1180 41 '- 1180 48' East Longitude and 080 20 '080 30' South Latitude with an area of 222.2 Km2. The City of Bima is administratively divided into 5 (five) Districts, namely Asakota, Mpunda, Raba, West Rasanae, and East Rasanae Districts. Based on the potential of existing resources, various investment opportunities are quite prospective to be developed in the City of Bima, including in the fields of: services, including transportation, electricity and telecommunications, trade, agribusiness / agro-industry, bottled water industry, small industry and crafts, tourism and education. The City of Bima was officially formed through the Law of the Republic of Indonesia Number 13 of 2002. The City of Bima is led by a Mayor with the civilization culture of Dou Mbojo who has been rooted since the royal era until now can still be seen in the life of the people of the City of Bima in their daily lives. Both social, cultural and traditional arts attached to the activities of Traditional Ceremonies, Marriage Processions, Khataman Qur'an, Circumcision and others as well as historical evidence of the Kingdom and Sultanate can still be seen as Sites, Archeology and even become Attraction Attractions in the City of Bima and is the object of visit for local tourists, the archipelago and even foreign countries. Mayor H. Muhammad Lutfi, SE Shareholding 1.30% IDR10,067 million Deputy Mayor Feri Sofiyan, SH. ssfgbg Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 118
  120. Company P ro fi l e s STRUCTURE OF THE GROUP OF COMPANY SUBSIDIARIES AND AFFILIATED COMPANY Names and Addresses of Subsidiaries & Associates As of the end of December 2020, Bank NTB Syariah did not have subsidiaries and/or associated entities that were consolidated in the financial statements Company Group Structure As of the end of December 2020, Bank NTB Syariah did not have any subsidiaries, associated entities, joint ventures or special purpose vehicles (SPV) therefore The Bank has no information to describe the structure of the company group related to this matter. CHRONOLOGY OF STOCK LISTING AND OTHER SECURITIES Stock Listing Chronology Until the end of December 2020, Bank NTB Syariah did not issue shares and was not listed on the capital market, thus the bank has no relevant information regarding the number of shares outstanding, market capitalization, highest price, lowest price, closing share prices and trading volume. Other Securities Listing Chronology Until the end of December 2020, Bank NTB Syariah did not issue bonds, sukuk or convertible bonds, so The Bank hold no information regarding the number of bonds / sukuk / convertible bonds in circulation, interest rate, maturity date, and bond / sukuk rating. 119 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  121. NAME AND ADDRESS OF SUPPORTING INSTITUTIONS AND /OR PROFESSIONALS La Company Name Tanubarata Sutanto Fahmi Bambang dan Associate Member of BDO International. Address Prudential Tower 17th Floor. Jln. Jenderal Sudirman Kav. 79 Tel. 021-5795 7300 Phone/Fax/e-mail 021 57957300/021 57957301/ sutomo@bdo.co.id Work Field Audit Statement of Financial Position (Balance Sheet) as of December 31, 2020, Statement of Profit and Loss and Other Comprehensive Income, Statement of Changes in Equity and Statement of Cash Flow Assignment Period a. Interim Bank audits begin in September 2020 and end in October 2020. b. The financial year-end 2020 audit starts in December 2020 and ends at the end of February 2021. c. Preparation and submission of reports including a Management Letter submitted at the end of February 2021 Cost IDR352,000,000,- Law Consultant Company Name Emil Siain, S.H. & Rekan Address Jl. Sriwijaya No. 80 B Cakranegara - Mataram Phone/Fax/e-mail (0370) 6160449/ (0370) 648895 / noersiain@gmail.com Work Field a. Legal Consultant Services b. Licensing management related to legal aspects of the company, including HAKI (brand patent) when required c. Preparation of the draft and/or labor contracts, and company regulations d. Assitance or a company representative as the legal attorney, especially regarding criminal law, civil law, state administration, labour, and others related law related both inside and outside the court. Assignment Period 2019-2020 Cost IDR250,000,000 Notary Company Name Abdullah, S.H Address Jl. Bung Karno No. 58 Mataram Phone/Fax/e-mail (0370) 632109 Work Field Administration of yearly GMS, extraordinary GMS and Circular Assignment Period Year 2020 Cost IDR7,000,000 Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 120
  122. Company P ro fi l e s NAME AND ADDRESS OF BRANCH OFFICES Bank NTB Syariah, as a Regional Bank which was founded in 1964, besides managing the Regional Treasury for the Regional Government of the NTB Province and districts / cities Regencies in NTB and Surabaya, it is also a bank that serves public financial transactions. As form of quality services to all customers, Bank NTB Syariah is always committed to increasing access to the availability of office networks spread across the NTB region. The number of office networks as of 31 December 2020 is 49 offices, consisting of 12 Branch Offices (KC), 23 Sub-Branch Offices (KCP), 6 Cash Offices (KK), 7 Service Offices (KP) and 5 Mobile Cash Service Car with explanation of location, type, name and office address as follows: Mataram City Pejanggik Branch Office Sriwijaya Branch Office Mataram Cakranegara S. Branch Office Jl. Pejanggik No. 30 Mataram Jl. Sriwijaya, Kota Mataram Jl. Sultan Hasanuddin No. 27 Cakranegara Mataram Sweta Branch Office Mataram Kebon Roek Cash Office Mataram RSUP Provinsi Cash Office Jl. Sandubaya No. 12 Sweta Komplek Toko Pasar Kebon Roek Jl. Prabu Rangka Sari Dasan Cermen Mataram Mataram Pagesangan Service Office Governor NTB Service Office Purnabakti Cash Office Komplek Pasar Baru Pagesangan Jl. Pejanggik Mataram Jl. Majapahit, Kec. Selaparang Kota Mataram Senggigi Service Office Lombok Epicentrum Mall Service Office Komplek Pasar Seni Senggigi Jl. Sriwijaya No. 333 Mataram West Lombok Regency Gerung Branch Office Narmada S. Branch Office Kediri S. Branch Office Jl. Jenderal Ahmad Yani No. 1 Gerung Jl. Suranadi No. 46 Narmada Jl. TGH. Ibrahim Khalidy Kediri Lombok Barat Gerung Pemda Service Office Komplek Kantor Regent Lombok Barat, Gerung North Lombok Regency Tanjung Branch Office Pemenang S. Branch Office Jl. Tioq Tata Tunaq Tanjung, Lombok Utara Jl. Jenderal Sudirman No. 24 Pemenang Central Lombok Regency Praya Sudirman Branch Office Kopang S. Branch Office Pujut S. Branch Office Jl. Gajah Mada No. 127 Praya Jl. Bung Hatta No. 7 Kopang Jl. Raya Sengkol Kute-Pujut PLHUT Kemenag Loteng Service Office Jl. Ahmad Yani No. 5 Lombok Tengah Bagu Pringgarata Service Office 121 PT Bank NTB Syariah. 2020 Annual Report Jl. H. Badaruddin Bagu, Pringgarata Lombok Tengah Spirit of Amanah, Optimistic and Growth in Sustainable Business
  123. East Lombok Regency Selong Pahlawan Branch O ffice Aikmel S. Branch Office Labuhan Lombok Cash Office Jl. Pahlawan No. 3 Pancor Selong Jl. Raya Aikmel, Lombok Timur Jl. Raya Labuhan Lombok Kayangan Pancor Branch Office Paok Motong S. Branch Office Pancor Hamzanwadi Cash Office Jl. Raya Paok Motong Masbagik Komplek NW Pancor Sumbawa DR Wahidin Branch Office Alas S. Branch Office Plampang S. Branch Office Jl. Dr. Wahidin No. 3 Sumbawa Besar Jl. Pendidikan No. 3 Alas, Sumbawa Jl. Lintas Sumbawa-Bima Kec. Plampang Lunyuk S. Branch Office Utan S. Branch Office Lopok S. Branch Office Jl. Raya Lunyuk-Sumbawa Besar Jl. Raya Lintas Sumbawa Kec. Utan, Sumbawa Jl. Raya Lintas Sumbawa-Bima, Kec. Lopok Taliwang Sudirman Branch Office Pasar Taliwang S. Branch Office Maluk S. Branch Office Jl. Undru No. 5 Taliwang Jl. Lintas Taliwang No. 7-8 Sumbawa Barat Jl. Raya Maluk Sumbawa Barat Dompu Nusantara Branch Office Manggelewa S. Branch Office Kempo S. Branch Office Jl. Nusantara No. 20 Dompu Jl. Lintas Sumbawa-Dompu Soriotu, Dompu Jl. Raya Soro Dompu-Kec. Kempo, Dompu Bima Soekarno Hatta Branch Office Tente S. Branch Office Bolo S. Branch Office Jl. Soekarno-Hatta Bima Jl. Jurusan Bima-Tente No. 1, Bima Jl. Raya Lintas Sumbawa-Bima, Sila Bima Sape S. Branch Office Wawo S. Branch Office Raba Cash Office Jl. Pelabuhan Sape, Bima Jl. Raya Sape Wawo, Bima Jl. Raya Raba, Bima Jl. PB. Pancor Sudirman Komplek PTC Sumbawa Regency West Sumbawa Regency Dompu Regency Pekat S. Branch Office Jl. Lintas Calabai Dompu, Kedindi Barat - Pekat, Dompu Bima City/Regency Surabaya Surabaya Raya Darmo Branch Office Jl. Raya Darmo No. 95 Surabaya Mobile Cash Car Mobile Cash Car Bank NTB Syariah I Jl. Pejanggik No. 30 Mataram Mobile Cash Car Bank NTB Syariah II Jl. Pejanggik No. 30 Mataram Mobile Cash Car Bank NTB Syariah III Jl. Pejanggik No. 30 Mataram Mobile Cash Car Bank NTB Syariah IV Jl. Pejanggik No. 30 Mataram Mobile Cash Car Bank NTB Syariah V Jl. Pejanggik No. 30 Mataram Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 122
  124. Company P ro fi l e s INFORMATION AVAILABLE ON THE WEBSITE As a commitment to apply the principle of information disclosure and improve Good Corporate Governance to all Stakeholders, particularly Shareholders, Customers and Cooperation Partners; Bank NTB Syariah always submits information openly, transparently and up to date through the official website media www.bankntbsyariah.co.id which can be accessed by all parties concerned. The range of information conveyed through the website includes: 1. Home menu, contains information about: a. Slider image of main products, promotion programs, endowments and others that are delivered in turn for any given time. b. UMKM Corner Widget which contains information about NTB Syariah fostered by Bank NTB Syariah which is grouped into 4 categories, namely handicraft; cookies, food & beverages; clothes & fashion and beauty stuffs. This widget is a form of Bank NTB Syariah's concern for the development of MSMEs, which contains information on the diversity, excellence and contact person of each MSME product displayed. c. Simulation of the calculation of Zakat on Wealth (maal) d. 1500-667 Call Centre Link, Internet Banking and Virtual Hajj Account (link to the Hajj Financial Management Agency of the Republic of Indonesia (BPKH-RI) for checking the balance of the prospective Pilgrims e. Pilgrimage virtual account). News on activities and activities carried out by Bank NTB f. Syariah. Other information related to auctions, procurement of goods and services, job vacancies, event implementation g. and other educational activities. 2. Product Service Menu, contains information about: a. Main products and services of Bank NTB Syariah including Savings, Productive Financing, Consumer Financing, Services and Services as well as e-Banking . 123 PT Bank NTB Syariah. 2020 Annual Report 3. 4. 5. 6. Financing, Services and Services as well as e-Banking (Personal and Corporate Internet Banking) with types of information regarding description, types of contracts, benefits, facilities, requirements, fees and so forth. b. Simulation of profit-sharing calculation in accordance with applicable ratio and profit-sharing index and instalments of murabahah financing. Company Menu, contains information about: a. Bank NTB Syariah including History, Vision, Mission and Corporate Culture, Organizational Structure, Management Profile (Board of Commissioners, Sharia Supervisory Board and Directors) and Awards. b. Governances including Corporate Governance, Code of Ethics and Guidelines and Policies. c. Reports including the publication of Monthly, Quarterly and Annual Financial Statements, GCG Reports and Risk Exposure Reports. d. Corporate Social Events. Network Menu contains information on location and network address of Bank NTB Syariah offices and ATMs. UMKM Corner Menu, which contains information about NTB Syariah fostered by Bank NTB Syariah which is grouped into 4 categories, namely handicraft; cookies, food & beverages; clothes & fashion and beauty stuffs. This widget is a form of Bank NTB Syariah's concern for the development of MSMEs, which contains information on the diversity, excellence and contact person of each MSME product displayed. Contact Us menu contains information on the types and addresses of Bank NTB Syariah contacts including the Head Office, Call Centres, e-mails, Facebook, Instagram, and Twitter. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  125. EDUCATION AND /OR TRAINING FOR THE BOARD OF COMMISSIONERS, SHARIA SUPERVISORY BOARD, DIRECTORS, COMMITTEES, CORPORATE SECRETAR AND INTERNAL AUDIT UNIT COMPETENCY DEVELOPMENT OF THE BOARD OF COMMISSIONERS Throughout 2020, the Board of Commissioners of Bank NTB Syariah has participated in various competency improvement programs in the form of training, workshops and seminars as shown in the following table: Name Training Type Organizers Date and Place Zainal Fanani BPDSI National Seminar and Simpeda Savings Draw (PD.01,12/64/090/2020) BPDSI Jakarta, February 21st, 2020 Muslihun BPDSI National Seminar and Simpeda Savings Draw (PD.01,12/64/090/2020) BPDSI Jakarta, February 21st, 2020 Muhammad Nur BPDSI National Seminar and Simpeda Savings Draw (PD.01,12/64/090/2020) BPDSI Jakarta, February 21st, 2020 Zainal Fanani BPDSI National Seminar and Simpeda Savings Draw ASBANDA Jakarta, August 11th, 2020 Muslihun BPDSI National Seminar and Simpeda Savings Draw ASBANDA Jakarta, August 11th, 2020 Muhammad Nur BPDSI National Seminar and Simpeda Savings Draw ASBANDA Jakarta, August 11th, 2020 Zainal Fanani Sustainable Finance Action Plan (RAKB) Training Trisakti Sustainability Center Mataram, September 08th, 2020 Muslihun Sustainable Finance Action Plan (RAKB) Training Trisakti Sustainability Center Mataram, September 08th, 2020 Muhammad Nur Sustainable Finance Action Plan (RAKB) Training Trisakti Sustainability Center Mataram, September 08th, 2020 DEVELOPMENT OF COMPETENCY OF SHARIA SUPERVISORY BOARD Throughout 2020, the Sharia Supervisory Board for Bank NTB Syariah has participated in various competency improvement programs in the form of training, workshops and seminars as shown in the following table: Name Training Type Organizers Date and Place TGH. Rubai Ahmad Munawar, Lc. M.Si. Sustainable Finance Action Plan (RAKB) Training Trisakti Sustainability Center Mataram, September 08th, 2020 TGH. Rubai Ahmad Munawar, Lc. M.Si Webinar Workshop Pra-Ijtima'Sanawi (Annual Meeting) from DSN-MUI Dewan Syariah Nasional Majelis Ulama Indonesia Mataram, October 12th, 2020 Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 124
  126. Company P ro fi l e s DEVELOPMENT OF DIRECTORS COMPETENCY Throughout 2020, the Board of Directors of Bank NTB Syariah has participated in various competency improvement programs in the form of training, workshops and seminars as shown in the following table: Name Training Type Organizers Date and Place Kukuh Rahardjo BPDSI National Seminar and Simpeda Savings Draw (PD.01,12/64/090/2020) BPDSI Jakarta, February 21st, 2020 Baiq Dien Rosana J. BPDSI National Seminar and Simpeda Savings Draw (PD.01,12/64/090/2020) BPDSI Jakarta, February 21st, 2020 Saharuddin The cost of the National Seminar on strategies to improve the quality of human resources in the field of payment systems and rupiah currency management Lembaga Pengembangan Perbankan Indonesia Jakarta, March 08st, 2020 Ferry Satrio Level 5 Risk Management Certification Solusi Bankir Surabaya, March 11st, 2020 Saharuddin Additional Charge and Refreshment of Plano Meeting IIGMA Bandung, February 13th, 2020 Muhamad Usman Online Education and Training for General Management of Pension Funds ADPI Mataram, June 10th, 2020 Muhamad Usman Pension Fund General Management Certification Exam LSPDP Mataram, June 12th, 2020 Kukuh Rahardjo BPD SI National Seminar and Simpeda Savings Drawing Lottery ASBANDA Jakarta, August 11th, 2020 Baiq Dien Rosana J. BPD SI National Seminar and Simpeda Savings Drawing Lottery ASBANDA Jakarta, August 11th, 2020 Kukuh Rahardjo Sustainable Finance Action Plan (RAKB) Training Trisakti Sustainability Center Mataram, September 08th, 2020 Baiq Dien Rosana J. Sustainable Finance Action Plan (RAKB) Training Trisakti Sustainability Center Mataram, September 08th, 2020 Muhamad Usman Sustainable Finance Action Plan (RAKB) Training Trisakti Sustainability Center Mataram, September 08th, 2020 Web Seminar Traditional Banks VS Challenger Banks In The Era Of Open Banking Infobank Baiq Dien Rosana J Mataram, September 29th, 2020 Muhamad Usman Dealer Certification Training IIGMA Mataram, November 28th, 2020 Baiq Dien Rosana J. Waqf Bank Socialization Imam Teguh Saptonno Mataram, December 7th, 2020 Muhamad Usman Waqf Bank Socialization Imam Teguh Saptonno Mataram, December 7th, 2020 125 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  127. AUDIT COMMITTEE COMPETENCY DEVELOPMENT Throughout 2020 , the Bank NTB Syariah Audit Committee has participated in various competency improvement programs in the form of training, workshops and seminars as shown in the following table: Name Bambang Training Type Level 3 Risk Management Certification Training Organizers Solusi Bankir Date and Place Mataram, September 14th, 2020 RISK MONITORING COMMITTEECOMPETENCY DEVELOPMENT Throughout 2020, the Bank NTB Syariah Risk Monitoring Committee has participated in various competency improvement programs in the form of training, workshops and seminars as shown in the following table: Name Susi Retna Cahyaningtyas Training Type Level 3 Risk Management Certification Training Organizers Solusi Bankir Date and Place Mataram, September 14th, 2020 REMUNERATION AND NOMINATION COMMITTEE COMPETENCIES DEVELOPMENT Throughout 2020, the Bank NTB Syariah Remuneration and Nomination Committee has participated in various competency improvement programs in the form of training, workshops and seminars as shown in the following table: Name Training Type Organizers Date and Place Zainal Fanani BPDSI National Seminar and Simpeda Savings Draw (PD.01,12/64/090/2020) BPDSI Jakarta, February 21st, 2020 Zainal Fanani BPDSI National Seminar and Simpeda Savings Draw Draw ASBANDA Jakarta, August 11th, 2020 Zainal Fanani Sustainable Finance Action Plan (RAKB) Training Trisakti Sustainability Center Mataram, September 08th, 2020 Lalu Isnandar pademan Socialization of the Health Talk Corona Virus (Covid-19) Rs. Risa Sentra Medika Mataram, March 20th, 2020 Lalu Isnandar Pademan Risk Management Workshop on Islamic Banks Ikata Akuntansi Indonesia Mataram, May 13th, 2020 Lalu Isnandar Pademan Webinar on Resilience and Sharia Business Strategies in Facing Covid-19 LPPI Mataram, May 13th, 2020 Lalu Isnandar Pademan Competency Improvement of Corporate Human Resources Entering the New Normal Era Econand Mataram, July 20th, 2020 Lalu Isnandar Pademan Level 4 Risk Management Certification Training Solusi Bankir Mataram, September 16th, 2020 Distance Certification Training-PSJJ (Virtual Training) DPD PERBARINDO JABAR Mataram, October 12th, 2020 Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 126
  128. Company P ro fi l e s CORPORATE SECRETARY COMPETENCY DEVELOPMENT Throughout 2020, the Corporate Secretary of Bank NTB Syariah has participated in various competency improvement programs in the form of training, workshops and seminars as shown in the following table: Name Training Type Organizers Date and Place Nur Herlina Risk Management Certification Training and Briefing Solusi Bankir Mataram, February 24th-27th, 2020 Nur Herlina Risk Management Certification Training and Briefing LSPP Mataram, March 07th, 2020 L Ibnurush Al-Hafied Risk Management Certification Training and Briefing Solusi Bankir Mataram, February 24th-27th, 2020 L Ibnurusd Al-Hafied Risk Management Certification Training and Briefing LSPP Mataram, March 07th, 2020 L Ibnurusd Al-Hafied Sustainable Finance Action Plan Training Trisakti Sustainable Center Mataram, September 17th, 2020 L Ibnurusd Al-Hafied Sustainable Finance Action Plan Training Trisakti Sustainable Center Mataram, November 10th, 2020 INTERNAL AUDIT UNIT COMPETENCY DEVELOPMENT Throughout 2020, the Bank NTB Syariah Internal Audit Unit has participated in various competency improvement programs in the form of training, workshops and seminars as shown in the following table: Name Training Type Organizers Date and Place Andarini Sharia Treasury Management and Sharia Asset Webinar Workshop Medina Consulting Mataram, September 22nd, 2020 Andarini Liability Management (SHALMA) Solusi Bankir Mataram, September 16th, 2020 Andarini Level 4 Risk Management Certification Training LSPP Mataram, October 17th, 2020 Andarini Level 4 Risk Management Certification Exam Sustainable Finance Action Plan Training Trisakti Sustainability Center Mataram, September 08th, 2020 Sumardialina Perpisanti Risk Management Certification Training and Briefing Solusi Bankir Mataram, February 24th -27th, 2020 Sumardialina Perpisanti Risk Management Competency Exam LSPP Mataram, March 07th, 2020 127 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  129. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 128
  130. 04
  131. MANAGEMENT ANALYSIS AND DISCUSSION OF THE BANK PERFORMANCE Economic Review Operational Review Tinjauan Kinerja Keuangan Strategies and Work Plans for 2021 131 136 167 233
  132. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e ECONOMIC REVIEW GLOBAL ECONOMIC ANALYSIS 2020 opens with optimism about a trade agreement between the United States and China and the start of the Brexit transition period . However, the spread of the Covid-19 virus which has been declared a pandemic by the World Health Organization (WHO) is putting enormous pressure and changing the direction of the global economy drastically. This pandemic is not only a public health crisis, but a crisis that touches every sector. Almost all countries in the world experience negative economic growth. In the World Economic Outlook report for January 2021, the IMF estimates that global economic growth in 2020 will contract by 3.5%. Various policies in various countries have been implemented as a response to the pandemic. Many countries have taken policies to limit community mobility or lockdown by closing access to and from the country, to prohibit people from leaving the house in anticipation of a worse impact. This policy caused global economic activity to weaken significantly until it almost came to a halt. In the midst of extraordinary uncertainty, the IMF projects the global economy to grow by 5.5% in 2021 and 4.2% in 2022. This is supported by the recovery of the economy in several countries along with the adoption of adaptations to the "New Normal" and 131 PT Bank NTB Syariah. 2020 Annual Report various vaccine approvals. and the launch of vaccinations in several countries in December 2020 which has raised hopes that the global economy will improve. The strategic measures announced at the end of 2020, particularly in the United States and Japan, are expected to provide further support to the global economy in the following year. NATIONAL ECONOMIC ANALYSIS The global economic conditions which experienced a crisis due to the Covid-19 pandemic have had a significant impact on the Indonesian economy. President of the Republic of Indonesia Joko Widodo announced the first positive case of Covid-19 in Indonesia on Monday, March 2, 2020, which was transmitted by human-to-human transmission. Through Presidential Decree (Keppres) Number 12 of 2020, it has determined that the spread of Covid-19 is a non-natural disaster on a national scale. Indonesia's economic growth in 2020 was recorded to experience a contraction of 2.07% (YoY). For two consecutive quarters, the Indonesian economy experienced contraction which caused Indonesia to experience recession for the first time since the monetary crisis in 1998. In the second quarter the Indonesian economy experienced a deep contraction of 5.3% (YoY) and the third quarter the economic contraction slowed Spirit of Amanah, Optimistic and Growth in Sustainable Business
  133. down in the second quarter . 3.5% (YoY). The government's policy to establish large-scale social restrictions (PSBB) and physical distancing has limited mobility of the community, resulting in a weakening of economic activity. The government has taken a number of policies in handling the covid-19 pandemic. In semester II, Indonesia's economic growth began to improve. The easing of the PSBB and improvement in the global economy, as well as the response to the national policy mix that was taken stimulated economic improvement. Based on data from the Central Statistics Agency (BPS), despite experiencing a contraction, economic growth in the fourth quarter of 2020 was 2.19% (yoy). The improvement trend in the fourth quarter of 2020 occurred in almost all components of demand and business fields. The Indonesian economy is predicted to continue improving in 2021, supported by progress in the handling of Covid-19, including vaccinations, global economic recovery, as well as stimulus and policy strengthening. In addition, the five policy steps taken by the Government will also support this prospect, namely (i) opening up productive and safe sectors nationally and in respective regions, (ii) accelerating fiscal stimulus, (iii) channeling bank credit from demand and supply, (iv) continued monetary and macroprudential stimulus, and (v) accelerated economic and financial digitization, particularly in relation to the development of MSMEs. The strong synergy between Bank Indonesia and the Government and the authorities regarding further policy steps that will be taken will be more effective in promoting economic recovery. WEST NUSA TENGGARA ECONOMIC ANALYSIS The economic condition of NTB Province in 2020 experienced a contraction of 0.64% (yoy), down from the growth in 2019 of 3.85%. On the demand side, all components experienced contraction as well as slowing growth due to the Covid-19 pandemic that began in Indonesia since March 2020, except for the component for foreign exports which grew higher in line with improving exports of copper products. From the supply side, all business fields (LU) experienced a contraction or slowdown in growth except for Mining and Excavation Business Areas which still grew by 27.65% (yoy). Meanwhile, Mining and Excavation LU is improving in line with the mining cycle which has reached good quality and high value ore and international demand remains high. Meanwhile, on a quarterly basis, economic growth declined from the previous quarter. in the fourth quarter of 2020, the NTB economy contracted by 3.03% (yoy), down from the contraction in the third quarter of 2020 by 1.00% (yoy). On the demand side, the economic downturn in NTB is due mainly to lower performance in Household Consumption, Foreign Imports and PMTB. Meanwhile, from the supply side, the decline in economic growth in NTB compared to the previous quarter was mainly due to a decline in the performance of the Transportation and Warehousing LU, the provision of accommodation and food and drink and construction. In 2020, GDP growth excluding Mining Business Unit contracted by 5.19% (yoy), down from the previous year's growth of 4.76% (yoy). Even so, on a quarterly basis, the economic performance of NTB in the fourth quarter of 2020 improved compared to the previous quarter. In quarter IV-2020, GDP growth outside Mining Business Areas contracted by 5.97% (yoy), improving compared to the previous quarter which contracted by 6.58% (yoy). The realization of the NTB Province's Gross Regional Domestic Product (PDRB) based on the calculation based on the current price in 2020 reached IDR 133.52 trillion. With the achievement of this realization, the share of the NTB Province's GRDP to the National Gross Domestic Product (GDP) was recorded at 0.735%. This share decreased slightly compared to 2019 which amounted to 0.741%. 8 10 5 5 0 -5 2 -10 -15 1 Q-I Q-II Q-III Q-IV 2018 National GDP Q-I Q-II Q-III Q-IV 2019 Q-I Q-II Q-III Q-IV 2020 NTB GDRP - RHS NTB GDRP without the MIning Sector *Source : NTB Province Economic Report - February 2021, Bank Indonesia Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 132
  134. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e 15 150 10 100 5 50 0 -5 0 -10 -50 -15 -20 Trw-I Trw-II Trw-III Trw-IV Trw-I Trw-II Trw-IV 2019 2018 NTB GDRP with the Mining Sector Trw-III Trw-I Trw-II Trw-III Trw-IV -100 2020 Household Comsumption PMTB *Source : NTB Province Economic Report - February 2021, Bank Indonesia NATIONAL GENERAL BANKING INDUSTRY ANALYSIS The slowdown in community economic activity due to the Covid-19 pandemic has significantly impacted the performance of banks as intermediary institutions. This is indicated by credit growth which still contracted by 2.41% in December 2020 in line with weak domestic demand and banking prudence in extending credit. On the supply side, banking capacity in channeling was very adequate in line with the easing of monetary policy in the form of lowering interest rates and liquidity injections, as well as relaxation of macroprudential policies. In contrast to credit, growth in deposits continued to increase to 11.11% (yoy) in December 2020, in line with fiscal expansion and accommodative monetary policy which also influenced the increase in money supply growth. In the future, the banking intermediary function will continue to be encouraged so that it can sustain national economic growth. Financial system stability was maintained as reflected in the relatively high Capital Adequacy Ratio (CAR) for banks in 2020, namely 23.81%. This condition can then absorb risks that could disrupt financial system resilience and safeguard the transmission of monetary policy through the interest rate channel. Meanwhile, maintained financial system stability can also be seen in other Financial System Stability Indices, namely the relatively low non-performing loan (NPL) ratio of 3.06% (gross) or 0.98% (nett). with a contraction of 2.41% (yoy) in December 2020. With these developments, Bank Indonesia has revised its credit/ financing growth projection in 2021 from the original range of 7% -9% to 5% -7%. In this regard, various steps are continuously strengthened by synergies in policies of the KSSK, banking and business sector to maintain optimism and overcome supply and demand side problems in channeling credit/financing from banks to the business world, in order to promote national 133 PT Bank NTB Syariah. 2020 Annual Report economic recovery. In line with this policy synergy, Bank Indonesia continued with accommodative macroprudential policies by loosening credit / financing provisions in the property and automotive sectors to accelerate intermediation recovery while still observing the principles of prudence and risk management. The outlook for the Indonesian economy is predicted to resume strength on the back of progress in handling Covid-19, including vaccinations, global economic recovery, as well as stimulus and policy strengthening. The economic recovery in Indonesia, which began to appear in the second semester of 2020, is predicted to continue in 2021. Progress in handling Covid-19, including the use of vaccines, global economic recovery, macroeconomic policy stimulus, and various efforts to sharpen policy strategies support optimism for economic strengthening. Vaccination and discipline in applying the Covid-19 protocol are prerequisites for the national economic recovery process. In addition, five policy measures also support this prospect, namely (i) opening up productive and safe sectors nationally and in respective regions, (ii) accelerating fiscal realization, (iii) increasing bank credit from the demand and supply side, ( iv) the continuation of monetary and macroprudential stimuli, and (v) the acceleration of economic and financial digitization, particularly related to the development of MSMEs. Supported by these various factors, the Indonesian economy is predicted to grow in the range of 4.8-5.8% in 2021. Inflation is also predicted to remain under control within the target range of 3.0 ± 1%. Source : Indonesian Banking Statistics (SPI) and the Secretary of Bank Indonesia Economic Report on Indonesia - February 2021, Bank Indonesia Spirit of Amanah, Optimistic and Growth in Sustainable Business
  135. SHARIA BANKING INDUSTRY ANALYSIS The banking industry is faced with challenges that are not light . The contraction of economic growth has had an impact on the banking industry. Various economic stimuli have been provided by the government to boost Indonesia's economic growth. Throughout 2020, Bank Indonesia (BI) has issued a policy by lowering the BI 7-day repo rate by 8 (eight times) from 6.00% to 4.00%. In line with this policy, the Financial Services Authority (OJK) also issued a policy to encourage the optimization of the banking intermediation function, maintain financial system stability, and support economic growth by issuing POJK No. 11 / POJK.03 / 2020 concerning National Economic Stimulus as a Countercyclical Policy on the Impact of the Spread of Corona Virus Disease 2019. Based on the Sharia Banking Statistics (SPS) issued by the Financial Services Authority (OJK) in 2020, national Islamic banking assets grew by 13.23% (YoY) to Rp593,948 billion. Meanwhile, the distribution of Islamic banking financing grew by 8.10% (yoy), higher than the national banking which grew by -2.41% (yoy) and the growth of Third Party Funds (DPK) reached 11.86%. (in million rupiah) National Sharia Banking Market Share Description National Banking Asset Sharia Banking Growth (yoy) 9,177,894 8,562,974 7.18% 524,564 13.23% 6.47% National Banking 6.13% 6,665,390 Sharia Banking 465,977 Market Share 5,998,648 11.11% 416,558 11.86% 6.99% National Banking Financing 2019 593,948 Market Share Third-Party Funds 2020 6.94% 5,481,560 Sharia Banking 383,944 Market Share 5,616,992 -2.41% 355,182 8.10% 7.00% 6.32% Source: Indonesian Banking Statistics (SPI) OJK, Sharia Banking Statistics (SPS) OJK and the Regional Secretary of Bank Indonesia Diagram Pangsa Pasar Bank NTB Syariah dibandingkan dengan Perbankan Syariah Daerah di NTB Tahun 2020 Third-Party Funds Asset (In Billion Rupiah) Pembiayaan (In Billion Rupiah) (In Billion Rupiah) 383,944 465,977 593,948 2020 2020 9,177,894 6,665,390 National banking 2020 5,481,560 Sharia Banking Meanwhile, the position of the 2020 Capital Adequacy Ratio (CAR) grew to 21.64% compared to the previous year of 20.59%. Return On Assets (ROA) or the ratio of the ability of banks to generate profits to see the effectiveness of banks in generating revenue in 2020 amounted to 1.40%, a decrease compared to 2019 of 1.73%. The Non-Performing Financing (NPF) ratio or assessment of sharia banking based financing in 2020 is at 3.13%, a decrease compared to the 2019 position of 3.23%. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 134
  136. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e WEST NUSA TENGGARA BANKING INDUSTRY ANALYSIS The performance of Commercial Banks (conventional and sharia) in NTB Province will continue to experience positive growth in 2020 which must be in a decline in economic conditions in the era of the Covid-19 pandemic. Total Commercial Bank Assets in NTB Province in 2020 reached IDR 61.69 trillion or experienced a growth of 14.12% (yoy). With a value of lending reaching IDR50.61 trillion or a growth of 12.59% (yoy with the most significant increase in growth in the working capital loan component. Growth in Third Party Funds reached Rp.33.36 trillion or grew by 7.24%, dominated by more. by Savings. Commercial bank intermediation in NTB Province is still very high, indicated by the Loan to Deposit Ratio (LDR) indicator that is above 100%. The LDR ratio in NTB Province in 2020 was recorded at 151.68%. The LDR ratio that is above 100% is due to the continued high lending that was not matched by growth in deposits. This condition also indicates that commercial banks in NTB Province need a source of funds other than DPK collection, which is generally met from sources of financing from the center or outside the region. The Non-Performing Loan (NPL) Ratio of Commercial Banks in NTB Province in 2020 was recorded at 1.03% lower than in 2019 which was recorded at 1.06%. The NPL ratio in NTB Province which is maintained at around 1% indicates the relatively strong banking intermediation system in NTB Province. Meanwhile, the covid-19 pandemic that has hit since the beginning of 2020 has also contributed to an increase in the share of restructured loans. Meanwhile, the increase in the amount of restructured loans was due to the slowdown in business activities in several economic sectors so that business actors needed relaxation in the form of credit restructuring. The implementation of the new normal phase with the reopening of economic activities in the community has resulted in an increase in public financial transactions, especially non-cash financial transactions. The increase in non-cash financial transactions has an impact on operational efficiency, including increasing other operating income in the form of fee-based income for Commercial Banks. To support the implementation of non-cash transactions in the regions, Bank Indonesia through the electronification program continues to support several activities, including: 1. Electronification of Government Transactions (ETP) in regions, where support for increased non-cash transactions is focused on revenue transactions of each Regional Government (Pemda). Some examples of transactions that have been pursued are: a. Mataram City is discussing the development of an ETP system for revenue transactions using QRIS; b. North Lombok Regency implements levies with a split transaction mechanism at the crossing to Gili Indah. The community makes one payment, then the system automatically calculates the portion of the transaction for each party (North Lombok Tourism Department, Syahbandar, harbour). 135 PT Bank NTB Syariah. 2020 Annual Report 2. 3. 4. 5. Supporting Government Transaction (ETP) electronification development projects throughout 2020 in NTB Province, namely: a. Electronification of traditional market charges at Dasan Agung Market and Kebon Roek Market b. Electronification of waterfall tourism areas in North Lombok Regency Monitoring the distribution of non-cash social assistance. The quality of the distribution of aid services continues to be improved every period as evident from the decreasing rate of data errors in the field. The nominal distribution of non-cash social assistance has increased throughout 2020 with the percentage of distribution reaching 100% from the distribution of the March to December 2020 stage in all cities/regencies in NTB Province. Implementing Training for Trainers (TOT) for students of the Sumbawa University of Technology (UTS) as part of the student KKN material. The main objective is to make KKN Participant Students an extension of BI in terms of non-cash transaction literacy. Supporting village digitization (MAHADESA), which prioritizes the collection of village local MSMEs, and is channeled back to meet the internal needs of the village. All payments are made non-cash using various channels, especially QRIS. In December 2020 a coordination meeting was held to strengthen the implementation of Mahadesa on Lombok Island, spread across West Lombok Regency, North Lombok Regency, East Lombok Regency, and Central Lombok Regency. (Source : Indonesian Banking Statistics (SPI) and the Secretary of Bank Indonesia NTB Economic Report - February 2021, Bank Indonesia) BANK NTB SYARIAH POSITION IN THE BANKING INDUSTRY Bank as one of the Sharia Commercial Banks in Indonesia as well as the Regional Development Bank has a role in maintaining financial stability and encouraging regional economic growth. For this reason, it is hoped that the role of the Bank can be maximized in the conditions of the COVID-19 epidemic, especially in the NTB region. Some of the challenges faced by the Bank in the coming period include handling financing for customers who are directly affected by COVID-19, expansion of new, more selective distribution of financing while continuing to improve prudential banking principles, and optimizing the role of digital banking for customer transactional ease. In order to achieve a sustainable business growth rate, the Bank seeks to overcome internal and external obstacles to become the focus of attention in accordance with the direction of the Bank's General Policies as follows: 1. Maintain the Bank's captive market and increase the efficiency and effectiveness of the organization in sustainable and quality business growth; 2. Product development innovation according to customer needs and e-channel development support retail Third Party Fund Optimization (DPK) Bank services and other sources of funds; 3. Increase growth and maintain the quality of Bank financing; Spirit of Amanah, Optimistic and Growth in Sustainable Business
  137. 4 . 5. 6. 7. Develop and optimize information technology system infrastructure; Strengthen the Bank's capital from shareholders and enlarge the portion of retained earnings and reserves; Fulfill the competence and number of Human Resources (SDI); Improve the quality of compliance implementation and strengthen risk management as well as the implementation of Good Corporate Governance (GCG). The financial performance of Bank NTB Syariah in 2020 showed a positive performance even though 2020 was a year full of challenges due to the slowing down of the macro economy, economic expectations drastically changed from optimistic that there will be a recovery in 2020, to a recession as a result of the COVID-19 pandemic. In the fourth quarter of 2020, Bank NTB Syariah assets grew by 20.59%, much higher than the growth of National Banking assets of 7.18% and Islamic banking assets of 13.23%. Although from the aspect of raising funds, the growth of third party funds of 8.69% was below the growth of third party funds in the national banking and sharia banking with growth of 11.11% and 11.86%, respectively. In terms of disbursement of funds, the growth of Bank NTB Syariah financing was 14.85%, still higher than the growth in national banking credit distribution which contracted by 2.41% and the growth in sharia banking financing disbursement was 8.10%. Meanwhile, banking profit growth in general has decreased as a result of slowing economic activity in the era of the Covid-19 pandemic. Even though the net profit achievement of Bank NTB Syariah contracted, its growth was still above the growth of the National Banking. However, in line with the recovery in economic conditions which are predicted to continue to improve, Bank NTB Syariah is optimistic that it can continue to improve its performance and maintain business growth in the future. Table of performance growth of the NTB Syariah Bank compared to the Industry average Indicator Asset Credit/Financing Third-Party Funds Net Profit CAR * ROA * NI/NIM* NOM * BOPO * LDR/FDR * Bank NTB Syariah National Banking Regional banking Sharia Banking 20.59% 14.85% 8.69% -20.27% -10.90% -31.95% -20.47% -44.30% 5.93% 5.66% 7.18% -2.41% 11.11% -33.08% 2.09% -35.63% -9.37% 14.21% 12.59% 7.24% 13.23% 8.10% 11.86% -12.26% 5.10% -19.08% 9.06% -12.59% 4.99% -23.96% 1.30% -1.99% Source: Indonesian Banking Statistics (SPI), Sharia Banking Statistics (SPS), Sekda Bank Indonesia * The National Banking Ratio uses the performance of Conventional Commercial Banks, while the Sharia Banking ratio uses the performance of Islamic Commercial Banks Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 136
  138. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e OPERATIONAL REVIEW BUSINESS DEVELOPMENT STRATEGIES IN 2020 In 2020 , the focus of the Bank's strategy according to the grand road map contained in the corporate plan of Bank NTB Syariah is to implement and realize aggressive growth. Throughout 2020, the Bank was faced with the challenges of an economic recession due to the outbreak of the Covid-19 pandemic, however, the Bank has shown strong optimism by successfully maintaining significant business performance and growth. The spirit of trust in realizing aggressive growth becomes the motivation for the Bank to maintain good performance and sustainable business growth in the future. In line with the Corporate Plan, the following are the Bank's General Policies implemented during 2020:: 1. Encouraging sustainable and quality business growth 2. Optimization of retail Third Party Funds (DPK) and other sources of funds 3. Increase growth and maintain the quality of Bank financing 4. Develop and optimize information technology system infrastructure 5. Strengthen the Bank's capital from shareholders and enlarge the portion of retained earnings and reserves 6. Fulfill the competence and number of Human Resources (SDI) 7. Improving the quality of compliance implementation and strengthening risk management as well as the implementation of Good Corporate Governance (GCG) Furthermore, the policy is implemented using the Balanced Score Card (BSC) method which describes the strategy in 4 (four) perspectives as follows: 1. Financial Perspective Present the strategic objectives of the company in the financial aspect from the point of view of management and shareholders. 2. Customer Perspective Present strategic objectives that reflect the expected assessment of products and services produced from a customer / customer's point of view. 3. Internal Business Process Perspective Displays strategic objectives relating to how business processes are carried out in order to meet customer / customer needs as well as the demands of achieving strategic objectives in financial aspects. 4. Learning & Growth/People Development Perspective Displays strategic objectives related to the development and optimization of the use of human capital (skills, training & knowledge), information capital (systems, databases, networks), and organization capital (culture, leadership, alignment, teamwork) owned by the company. 137 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  139. Then translated into a strategy map , with the ultimate goal of achieving assets, profits and financial ratios in accordance with the business targets set by the Bank in the Bank's Business Plan, namely: Vision To become a trustworthy, Respectable, and Community Choice Sharia Commercial Bank Mission 1. Providing excellent service and providing innovative Islamic banking products according to customer needs. 2. Develop professional and prosperous Human Resources through the implementation of a consistent performance-based system. 3. Expanding service coverage for access and transactions through the application of reliable technology. 4. Provide maximum contribution to shareholders and increase the role of social care. 5. Encouraging regional economic growth. Increase the Bank's assets to IDR9.225 billion, net profit to IDR127 billion, CAR ratio 31.51%, ROE 9.13% and the Bank's soundness level is at least "healthy.” Financial Perspective Collecting third party funds Distributed financing of amounting to IDR6,100 billion IDR6,184 billion in 2020 with a Controlling the quality of financing so that the NPF is composition of productive financing of 8.53% and Increasing fee-based income consumer financing 91.47% by IDR57,832 million at the 1.38% and the net NPF ratio is max 0,81% end of 2019 Customer Perspective Internal Business Process Perspective Increasing service speed Increasing customer & ease of access. based. Developing and creating products Improving service quality & care Developing a marketing plan and strengthen brand positioning. Implementation of the new Organization Structure and Developing strategies, organizations and risk management infrastructures. Learning & Growth/ People Development Perspective Implement a new improving the business organizational structure and process and policy improve business processes and policies. Strengthening Implementing performance Developing HR strategies organizational culture and management links with and improve employee employee engagement reward and punishment. competence. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 138
  140. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e In 2020 , Bank NTB Syariah has implemented the following action plans: 1. Improvement of the Bank's business processes a. Fulfillment of the position of Director of Finance to strengthen the management and distribution of financing so that it is more effective; b. Establish a risk taking unit, namely the Business Risk Desk to strengthen risk mitigation by identifying, measuring, monitoring and controlling the course of the Bank's business activities with a reasonable level of risk in a directed, integrated and sustainable manner so that risk management is used to provide an early warning system for activities. Bank's business. c. Adjustment of the membership of the financing decision committee in line with the filling of the position of Director of Financing and the addition of a work unit that studies the Bank's business risks (Business Risk Desk) d. Reviewing the provisions and SOPs, especially in the field of financing, in accordance with the activities and business development of the Bank; e. Adjustment of the bank financing scheme in order to meet market needs into 4 (four) patterns, namely general scheme financing, gold rose scheme financing, special covid financing scheme and special micro financing scheme. f. Adjusted business processes by issuing a restructuring policy for 3 (three) customer categories, namely Covid-19 special restrades (for customers experiencing a post-pandemic business slowdown), FLPP special restrades (for housing finance customers experiencing post-pandemic repayment capacity) and general restruits (for customers experiencing a general business category slowdown). g. Strengthen orderly administration and monitoring of financing. h. Fulfilling the number and competence of Human Resources progressively through education and training. 2. Organizational Improvement Bank NTB Syariah consistently makes improvements and revitalization of organizational functions in order to find the right organizational composition in order to respond to any opportunities and challenges in the banking industry today and in the future. In 2020, the Bank has made several changes to the organizational structure in line with improvements to the Bank's business processes, namely by filling in the formation of the Director of Finance and strengthening risk management by adding a Business Risk Desk function which acts as the first line of defense in risk management and Bank business activities. Changes in the organizational structure of the Bank as referred to are stipulated in the Decree of the Board of Directors Number: SK.01 / 16/64/022/2020 dated 17 February 2020 concerning the Organizational Structure and Work Procedures of PT Bank NTB Syariah as well as additional adjustments in accordance with the Decree of the Board of Directors Number: SK Number. 01/16/64/047/2020 dated 10 July 2020 regarding the adjustment of several position formations in the organizational structure of Class I, II, and III Branch Offices and is an integral part of the 139 PT Bank NTB Syariah. 2020 Annual Report previous Directors' Decree. The improvement and revitalization of organizational functions that have been carried out by the Bank during 2020 have succeeded in building optimism and confidence in the Bank in maintaining good performance and achieving sustainable business growth. 3. ncreasing the quantity and quality of Human Resources (Realization of RBB) Fulfilling the need for reliable Human Resources (SDI) is the next step the Bank takes after refining and revitalizing organizational functions to ensure that every element of the organization functions optimally in supporting the achievement of business objectives in accordance with the focus and direction of the Bank's business development. The process of fulfilling SDI needs in 2020 will be carried out in stages according to the needs of the Bank's organizational structure, including: a. Recruitment of employees at the assistant level originating from fresh graduates;; b. Recruit professionals through a prohired process to fill certain position formations according to bank requirements;; c. Provide equal opportunities to potential employees for a career through the Assessment process; d. Implementing consistent rewards and punishments; e. Improve the quality and competence of SDI through continuous training programs; Meanwhile, in order to create quality, competent and highly competitive Human Resources (SDI), the Bank has implemented development strategies including: a. Developing employee competency improvement applications through e-learning programs that aim to improve the quality of teaching and learning through electronic media, change the learning culture so that employees are more familiar with IT, training cost efficiency, product development and digitization; b. Develop SDI quality and competence through training programs with themes in accordance with the Bank's needs, among others through assessment programs, professional certification, in-house training, and others; c. Implementation of corporate culture through optimization of the change agent function. d. Professional certification in the field of risk management, treasury, general, and human resources in accordance with the provisions / regulations; 4. Improvement of information technology infrastructure and systems In line with the organizational development strategy that has been implemented in 2020, the Bank has also carried out continuous development of information system technology to improve the capabilities and capacities of the Bank in accordance with the direction of business development. The strategic steps taken by the Bank for the development of information technology systems in 2020 are as follows: a. Developing and optimizing information technology system infrastructure including IT application development (core banking and non-core banking), DRC Spirit of Amanah, Optimistic and Growth in Sustainable Business
  141. and Data Center Development (preparation for i ndependent management), Bank network development (up to district); b. Develop and improve an integrated information technology system to improve services to the public in the digital era and support easy access to Bank information; c. Improve infrastructure and develop information technology applications in accordance with the direction of business development, internal needs, and in accordance with applicable regulations; d. The use of Electronic Channel (E-Channel) in stages according to the ability and readiness of the Bank will be optimized for the use of technology in supporting services such as ATM, SMS Banking, Internet Banking/ Mobile Banking to facilitate access to Bank products and services; e. Optimizing the role and function of information technology in the Bank's internal control; 5. 6. Strengthening Risk Management Bank NTB Syariah consistently makes continuous improvements to strengthen the implementation of risk management in order to ensure that the implementation of the Bank's business and operational activities runs according to applicable regulations. Efforts made include improving the organizational structure of the risk management work unit, risk management guidelines / SOP / BPP, providing Human Resources with risk management certification, and completing work units with applications to facilitate Bank risk management. Meanwhile, in order to strengthen business risk management, the Bank has formed a work unit as the First Line of Defense which has the role of managing and controlling the Bank's business risk in business unit activities. It is hoped that with these efforts the Bank's risk management can play a better role in mitigating all potential risks. Adjusting the Bank's products to competitive conditions In an effort to maintain and increase market share of the market, the Bank has developed products or diversified existing products, so as to provide greater utility and attractiveness to the public as well as provide the best solutions to customer needs. Bank product adjustments are in line with efforts to strengthen brand positioning and build public brand awareness of the Bank with the following programs: a. Modernizing and revitalizing fundraising which leads to the digitization of products and services as drivers for the Bank's business; b. Preparing "Bank NTB Sharia Priority" service; c. Speed and speed of service quality on the front liner; d. Increase the activity of the Bank's e-channel transaction services via ATM, EDC, mobile banking and SMS Banking, SMS Notification, and CMS services including adding a link to the installation of the mobile banking application via SMS Blasting e. Doing promotions; f. Increase distribution of productive financing; g. Use of non-cash transactions at local governments and Spirit of Amanah, Optimistic and Growth in Sustainable Business h. Increase distribution of the consumer sector to the general public outside ASN; i. Improve the supply chain concept to several agencies / agencies. MARKETING ASPECTS Marketing activities are carried out to introduce various types of Bank products so that what the business targets can be achieved as expected. The condition of the Covid-19 pandemic which requires the government to apply physical distancing to large-scale social restrictions (PSBB) in several areas has led to the implementation of the marketing activities of Bank NTB Syariah by educating and disseminating superior products that are not only manually using brochures, pamphlets, banner, but optimizing the use of electronic media and social media. This media is the most effective approach and reaches the wider community, especially the younger generation. Product information can also be easily obtained through the Bank NTB Syariah website. 2020 MARKETING STRATEGY Bank NTB Syariah also continues to innovate products and services in order to support retail fund growth, increase income and fee based income, and increase ease of access for customers. There is a main priority in the overall marketing strategy of Bank NTB Syariah, namely customer relations and product and service innovation. In terms of customer relationships, Bank NTB Syariah realizes the importance of having a strong and close relationship with customers in all business segments. The customer-focused mindset is the approach that Bank NTB Syariah continues to echo to all employees. Some of the marketing activities carried out by Bank NTB Syariah are as follows: 1. The policies implemented by the government in anticipating the spread of the Covid-19 virus caused limited mobility and reduced direct interaction intensity. This encourages banks to optimize the use of digital banking to provide easy access to transactions for customers. The Bank continues to promote the use of digital banking such as mobile banking and SMS banking for Bank NTB Syariah through social media and directly by cross selling to both new and existing customers. It is hoped that this activity will be able to increase the number of service users at Bank NTB Syariah so that it will affect the increase in fee-based income received by the Bank. With just one hand, customers can make transactions as needed. 2. Banks continue to promote the use of non-cash transactions to make salary payments, routine spending expenses, and others at Government Agencies (Pemda) and Private Agencies, (BUMD, Private Companies) to prevent the spread of the COVID-19 virus through cash objects with the CMS platform Kasda, CMS Corporate, PBB online, online samsat, E-Retribution, and autodebet to make transactions easier for customers. 3. Banks provide opportunities for educational institutions and students as academics to take part in the Intership program or Fieldwork Practices (PKL). During 2020, students who take part in this program come from several educational PT Bank NTB Syariah. 2020 Annual Report 140
  142. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e 4 . 5. institutions including the Tazkia Islamic Institute, the Hamzanwadi Islamic Institute NW Pancor and the Yogyakarta Muhammadiyah University. The Bank also holds special promo activities as a token of appreciation to customers, including: a. As a form of the Bank's concern for the preservation of Indonesian animals, the Bank collaborated with the “Lombok Wildlife Park” in a re-opening activity by giving special discounts to customers of Bank NTB Syariah during the period August 1st -31st 2020 b. In order to celebrate Indonesia's 75th Independence Day, Bank NTB Syariah has provided massive financing promotions to government employees, starting from ASN Candidates, Active ASNs, Pre-Retirees, and ASN Retirees, with free administrative fees and a discount on installment obligations during the period financing during the period August 17th – September 17th, 2020 c. The bank provides a financing promo "Gelegar Hijrah with Bank NTB Syariah" for the financing of Bale iB Amanah, iB Amanah Vehicles, iB Amanah Multipurpose, and Prosperous iB Amanah with cheaper and competitive installment facilities, period of up to 20 years, Flagging up to 75 years old, attractive compensation, fixed installments up to full, and free of fees and penalties for the period September 28th – October31st, 2020. d. The bank regularly holds quizzes on Bank NTB Syariah social media to get closer to the community by giving attractive prizes. Bank NTB Syariah has carried out several financial literacy activities for the public in order to educate and convince the public that Islamic banking has good financial governance and increase public understanding of the benefits of financial products and services which are expected to move the wheels of the economy, especially in NTB due to an increase in financial transactions created by the impact of financial literacy on society. To increase the focus of the bank's third party fund business in a more measured and comprehensive manner according to the existing business potential in a segmented manner, the segmentation of Tambora Savings has been added to Tambora Rencana iB Amanah, Tambora Bisnis iB Amanah and Tambora Pretise iB Amanah which are equipped with attractive features according to with customer needs. In order to carry out a healthy and effective financing expansion, Bank NTB Syariah has taken various approaches to marketing strategies by improving service quality, presenting financing products in accordance with market needs. The marketing strategy begins with the company's vision and mission, strategic plans and objectives, then translated into initiatives and actions according to the needs of each business segment and the characteristics of the target market. In order to be unidirectional, all strategies must be compatible and complement each other. There is a main priority in the overall marketing strategy of Bank NTB Syariah, namely customer relations and product and service innovation. In terms of customer relationships, 141 PT Bank NTB Syariah. 2020 Annual Report Bank NTB Syariah realizes the importance of having a strong and close relationship with customers in all business segments. The customer-focused mindset is the approach that Bank NTB Syariah continues to echo to all employees, especially those who serve on the front liner. In terms of financing, Bank NTB Syariah has innovated financing products to provide various needs for customers of all ages, families, to customers, both small and large, consumptive and productive according to the needs of today's society based on sharia principles, making it easier for the Bank to meet the needs of a wider market share and strengthen the foundation and aqidah. For customers, the breadth of choice allows them to identify the best product and the one that best meets their needs. In addition to ensuring that all products and services can be accessed through various channels, so that they are always in line with developments in trends and technology, Bank NTB Syariah continues to strive to strengthen e-channel services and encourage simplification of various business processes, shorten service SLAs, and implement One Day Servce services. In terms of consumer financing, which is a captive market for Bank NTB Syariah, especially ASN, Bank NTB Syariah has established strategic partnerships with several government institutions and agencies, in order to continue to increase more competitive marketshare in a sustainable manner. In March 2020, Bank NTB Syariah again held the Gelegar Expo II property which was attended by several partner developers, where Bank NTB Syariah gave free approvels to prospective customers who registered with the theme "Want to Get a House at Bank NTB Syariah Aja" for the provision of subsidized housing for the community. NTB and received a positive response so that in 2020 housing financing can be realized, especially FLPP as many as 1,685 units, which can bring Bank NTB Syariah as the largest distributor of subsidized housing / FLPP in West Nusa Tenggara and into the top 10 best channeling banks at the national level. Meanwhile, in carrying out the acquisition of MSME financing in 2020, Bank NTB Syariah is expanding through cooperation with various institutions observing MSMEs, Regional entrepreneur associations, in which Bank NTB Syariah provides financing to its members through the Tunas Sejahtera iB Amanah product so that the productive segment of Bank NTB Sharia can grow, besides that Bank NTB Syariah also offers special products, such as financing for distributors and suppliers using a value chain approach such as partnerships with Rissa Hospital, BLUD Partnership, West Nusa Tenggara government programs. In 2020, Bank NTB Syariah will continue to improve marketing strategies, accelerate financing acquisitions, improve services and improve products and services. Bank NTB Syariah also continues to expand cooperation partners in order to improve quality and bring services closer to the people of NTB through increased partnership activities with private institutions, BUMD, BUMN, private companies, hospitals and also Regional Apparatus Organizations (OPD) in the scope of the NTB Provincial Government. and also districts / cities. The marketing strategy approach used will always be refined in order to keep abreast of market trends and choices, and to be able to support the achievement of company goals. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  143. MARKET SHARES The business competition faced by the NTB Syariah Bank with all Sharia Banking and General Banking in West Nusa Tenggara greatly determines market control . Bank NTB Syariah as a Sharia Bank as well as a Regional Bank determines the company's position in business competition, which can be seen based on assets, financing, and third party funds (DPK). BANK SYARIAH NTB COMPARED TO REGIONAL BANKING IN NTB In the midst of intense competition in the banking industry, Bank NTB Syariah is also facing competition with all Conventional Banking (Banking Industry) in West Nusa Tenggara. Based on the number of assets, financing and total third party funding / funds, market share in 2020 was respectively 16.89%, 12.67% and 22.21%, experiencing growth compared to 2019 of 15.99%, 12.42% , and 21.91%. This achievement shows the success of Bank NTB Syariah in improving operational performance after the business transition to a BUS. (in million rupiah) Banking Market Share In West Nusa Tenggara Bank NTB Syariah Asset Third-Party Funds Financing 2020 2019 Growth (yoy) 10,420 8,640 20.59% 14.21% Description NTB Regional Banking 61,693 54,019 Market Share 16.89% 15.99% Bank NTB Syariah 7,409 6,816 8.70% NTB Regional Banking 33,364 31,111 7.24% Market Share 22.21% 21.91% Bank NTB Syariah 6,411 5,582 14.85% NTB Regional Banking 50,607 44,948 12.59% Market Share 12.67% 12.42% Source: Indonesian Banking Statistics (SPI) OJK and the Regional Secretary of Bank Indonesia Bank NTB Syariah Market Share Diagram compared to Regional Banking in NTB 2020 Third-Party Funds Asset (in Millions Rupiahs) Financing (in Millions Rupiahs) 10,420 (in Millions Rupiahs) 7,409 2020 6,411 2020 61,693 33,364 NTB Regional Banking Spirit of Amanah, Optimistic and Growth in Sustainable Business 2020 50,607 Bank NTB Syariah PT Bank NTB Syariah. 2020 Annual Report 142
  144. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e BANK NTB SYARIAH COMPARED WITH SHARIA BANKING IN REGIONS IN NTB Based on the number of assets owned , the market share control of Bank NTB Syariah in 2020 reached 61.37%, in terms of third party funds in 2020 it reached 79.91% and financing reached 66.19%. The increase in market share is the implementation of an effective strategy implemented by Bank NTB Syariah. (in million rupiah) Banking Market Share In West Nusa Tenggara Asset Third-Party Funds 2020 2019 Growth (yoy) Bank NTB Syariah 10,240 8,640 20.59% NTB Regional Sharia Banking 16,978 13,694 23.98% Market Share Description 61.37% 63.09% Bank NTB Syariah 7,409 6,816 8.70% NTB Regional Sharia Banking 9,271 8,286 11.89% 79.91% 82.26% Bank NTB Syariah 6,411 5,582 14.85% NTB Regional Sharia Banking 9,685 8,395 15.37% 66.19% 66.49% Market Share Financing Market Share Source: Islamic Banking Statistics (SPS) OJK and the Regional Secretary of Bank Indonesia Bank NTB Syariah Market Share Diagram compared to Regional Sharia Banking in NTB 2020 Third-Party Funds Asset (in Millions Rupiahs) Financing (in Millions Rupiahs) (in Millions Rupiahs) 7,409 10,420 2020 6,411 2020 16,978 2020 9,685 9,271 NTB Regional Sharia Banking Graph of Bank NTB Syariah Market Share compared to Regional Banking in NTB (in %) 21.81% Bank NTB Syariah Graph of Bank NTB Syariah Market Share compared to Regional Sharia Banking in NTB (in %) 82.26% 22.21% 79.91% 63.09% 15.99% 16.89% 12.42% 2019 2020 Asset 2019 2020 Third-Party Funds 2019 PT Bank NTB Syariah. 2020 Annual Report 66.19% 12.67% 2020 Financing NTB Regional Sharia Banking 143 66.49% 61.37% 2019 2020 Asset 2019 2020 Third-Party Funds 2019 2020 Financing Bank NTB Syariah Spirit of Amanah, Optimistic and Growth in Sustainable Business
  145. STRATEGIC PARTNERSHIPS IN 2020 Facing the conditions of banking competition and facing the uncertainty of economic growth due to the Covid-19 pandemic is felt by almost all corners of the world , including Bank NTB Syariah. Unstable economic conditions increase increasingly competitive competition. In maintaining the quality of sustainable growth, Bank NTB Syariah collaborates with various business partners aimed at increasing the resilience, competitiveness and efficiency of the Bank in achieving the targets set in the Bank's Business Plan. Not only establishing new partners, the Bank also continues to maintain strategic partnerships with previous partners. The various forms of partnerships carried out by the Bank until the end of 2020 are as follows: 1. Cooperation Agreement in collecting Third Party Funds: a. Cooperation agreement between Bank NTB Syariah and several universities in NTB with the scope of optimizing cash management through the application of a Cash Management System (CMS), Host to Host payment of SPP, and application of Bank NTB Syariah debit / ATM card-based student cards which have been implemented at the University of Mataram, Mataram State Islamic University, Hamzanwadi University, Hamzanwadi Institute, NTB Nahdlatul Ulama University, Al Azhar Mataram Islamic University, West Nusa Tenggara University, YARSI College of Health Sciences, Qamarul Huda University Badaruddin Bagu Central Lombok, Mataram Muhammadiyah University. b. The Cooperation Agreement between Bank NTB Syariah regarding partnerships for the implementation of Hajj and Umrah pilgrimages with several agencies, including PT Amitra Syariah Finance, Dasa Utama Haj and Umrah Travel, Arafah Mina to provide alternative services and cooperation to the community in Hajj and Umrah activities. c. Other strategic cooperation agreements with several institutions and agencies that were implemented in 2020 or are still running from the previous year, namely: 1) PT Telkomsel regarding the development and utilization of information systems and technology; 2) PT Gerbang Emas NTB regarding virtual account services and cash management through the application of a Cash Management System (CMS); 3) Regional General Hospital of NTB Province regarding virtual account services and cash management through the application of a Cash Management System (CMS); 4) Metro Bangunan NTB concerning utilization of Bank service products to carry out payment activities using electronic channels (EDC); 5) Jasa Raharja Mataram Branch regarding the use of Bank service products to support raharja service activities throughout NTB; 6) BNI Syariah regarding cooperation in issuing Co-Brand financing cards; 7) NTB Provincial Revenue Agency (Bappenda NTB) regarding the use of Bank service products in supporting the implementation of NTB Regional E-Retribution; 8) Mataram City Transportation Agency regarding the Utilization of Bank Service Products in supporting the implementation of the NTB Region; 9) PT Taspen regarding Strategic Partnership; 10) BPRS Dinar Ashri regarding the implementation of partnerships and strategic cooperation in virtual account services, Corporate CMS, Host to Host, and banking technology; 11) PT Pegadaian (Persero) regarding the Implementation of Partnerships and Strategic Cooperation; 12) Taspen life regarding the implementation of partnerships and strategic partnerships for virtual account services, Corporate CMS, Host to Host and banking technology. 13) Implementing strategic partnerships and partnerships in digitizing and inclusiveness of NTB MSMEs with PT Dompet Digital Karya Anak Bangsa (GOPAY); 14. Insurance bundling with BNI Life regarding the Tambora Rencana iB Amanah Savings; 15. Extension of PKS with Provincial Dukcapil related to the use of NIK, population data, and electronic ID cards in the banking services of PT Bank NTB Syariah 16. PT PLN Persero regarding payment of electricity bills and other bills; 17. West Lombok Regency Licensing Service related to the implementation of Regional E-Retribution; 18. West Lombok Regency Transportation Agency related to the implementation of Regional E-Retribution; 19. West Lombok Health Office regarding capitation funds; 20. PDAM Praya regarding the implementation of strategic partnerships and cooperation; 2. Cooperation Agreement made in the framework of financing distribution: a. Cooperation in the Housing Sector 1) Cooperation agreement with the Housing Financing Fund Management Center (PPDPP) of the Ministry of Public Works of the Republic of Indonesia for the distribution of Home Ownership Credit (KPR) Fasilitaa Liquidity Housing Finance (FLPP) for Low Income Communities (MBR) in West Nusa Tenggara in 2020 2) Cooperation Agreement with the Ministry of Public Works of the Republic of Indonesia regarding Advance Subsidy / SBUM assistance for 2020 FLPP KPR Customers; 3) Improving and continuing the Cooperation Agreement with several FLPP housing developers / developers related to the distribution of Subsidized KPR for Low-Income Communities (MBR) both in Lombok, Sumbawa and Bima including with several developers, namely PT Zenit Lombok Property, PT Abicarya, PT Hissto Perkasa Nusantara, PT Bangun Lombok Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 144
  146. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e b . Lombok Internusa, PT Mekar Tumbuh Abadi, PT Varindo Lombok Inti, PT Salva Inti Property, PT Alam Asri, PT Daya Cipta Perdana, PT Rian Putra Jaya, PT Mataram Devindo C., PT Muara Alam Indonesia, PT Mandasari Putri, PT Rizqi Agung Putra, PT Wirat Bangun NTB, PT Citra Jaya Graha, PT Aura Bintang Timur, PT Baiti Janati, PT Sekar Sari, PT Maulana Raya Property, PT Bale Agung and Mahkota Cipta, and several other developers; Cooperation in the field of Small and Medium Enterprises (MSME) 1) Signed the collaboration with the Sharia Economic Community association, which is the driving force for fostering micro-economic growth, for the distribution of the Bank NTB Syariah's Mawar Emas financing program 2) Cooperating with IPEMI, an association of young entrepreneurs engaged in developing MSME businesses 3) Continuing the strategic partnership of the Indonesian Farmers Association (HKTI) NTB regarding the distribution of financing for Tunas Sejahtera iB Amanah Bank NTB Syariah for garlic farmers and corn farmers assisted by HKTI NTB 4) Cooperating in financing distribution with the Indonesian Young Entrepreneurs Association (HIPMI) 5) Collaboration with the Coffee Association (ASKOP), where in this collaboration Bank NTB Syariah facilitates members of the association for working capital from Tunas iB Amanah products 6) In collaboration with NTB Mall, where NTB Mall is a strategic partner with a marketing concentration through a digital-based market place. OPERATIONAL REVIEW The activities of Bank NTB Syariah are divided into 3 (three) types, namely the collection of Third Party Funds (Deposits), distribution of funds (Financing) and financial services as follows: THIRD-PARTY FUNDS FINANCING SERVICE Giro iB Amanah Bale iB Amanah Transfer (Remittance) Tambora iB Amanah Taharah iB Amanah Simpeda iB Amanah Simpel iB Amanah TabunganKU iB Amanah Deposito iB Amanah Kendara iB Amanah Bank Guarantee Multiguna iB Amanah Sejahtera iB Amanah Bank Support Ceritificate FLPP iB Amanah Cash Collateral Financing Tunas Sejahtera iB Amanah Bank Reference Modal Kerja iB Amanah Investasi iB Amanah Sindikasi iB Amanah Bank NTB Syariah measures the achievement of fund collection and disbursed financing. In the midst of challenging conditions, the Bank remains focused on maintaining its intermediation function so that it can become a driver of economic growth, especially West Nusa Tenggara (NTB). The policies and strategies taken by Bank NTB Syariah, namely, Handling restructuring of financing for customers directly affected by Covid-19, the Bank further enhances the principle of prudence in determining customer eligibility, especially for disbursement of new financing, focusing on targeting potential industries in the middle of the era. new normal, and optimize the role of digital banking as a transaction facility for customers to be able to transact quickly, comfortably, and of course safely. FUNDRAISING Bank NTB Syariah as an intermediary institution that collects funds from the public and distributes them back to the community continues to innovate fund-raising products to gain a wider market share. To raise third party funds, Bank NTB Syariah continues to explore potential funds, especially those originating from corporate funds and retail funds as well as increasing the penetration of fundraising. The Bank formulates various strategies in raising funds based on the Bank's predetermined targets. In 2020, Bank NTB Syariah will be able to demonstrate its existence through the achievement of significant fundraising. Total Third Party Funds that were successfully raised by Bank NTB Syariah reached IDR 7,408,918 million. This number has increased by 8.69% compared to the previous year which amounted to IDR 6,816,359 million due to various intensive product marketing activities 145 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  147. throughout 2020 , such as carrying out financial literacy activities to increase customer understanding of Islamic financial products and services, improving the quality of e-channel services. , strengthening the strategic cooperation that has been established with several partner institutions, expanding the customer base through product sales activities in branch and non-branch offices, cross selling. The following is the performance of Bank NTB Syariah savings products in 2020: (in million rupiah) 2020 Description Account Units Nominal iB Amanah Giro 2019 Nominal Growth Account Units Nominal Account Units 590,431 4,083 762,192 4,178 (171,761) (95) iB Amanah Savings 2,191,278 918,231 2,541,041 892,748 (349,763) 25,483 iB Amanah Deposit 4,627,208 3,121 3,513,126 3,569 1,114,082 (448) Total 7,408,916 925,435 6,816,359 900,495 592,558 24,940 Source: Bank NTB Syariah FInancial Reports Table of Performance Charts of Bank NTB Syariah Savings Products Nominal Table of Performance Charts of Bank NTB Syariah Savings Products Account Units (in million rupiahs) (in million rupiahs) 4.627.208 918.231 3.513.126 892.748 2.541.041 2.191.278 4.178 762.192 4.083 3.569 590.431 2019 2020 Giro 3.121 2019 2020 Savings 2019 2020 Deposit 2019 2020 Giro 2019 2020 Savings 2019 2020 Deposit The explanation of the performance of each Bank NTB Syariah deposit product is as follows: 1. iB Amanah Giro iB Amanah Giro are deposits which can be withdrawn and deposited at any time by using checks, bilyet giro, overbooking and other means of payment using the principles of wadiah and mudharabah in the transaction process. Based on its function, iB demand deposits are differentiated into Provincial / City / Regency Regional Government Giro which are used in regional cash management activities and payment of ASN salaries through the General Allocation Fund (DAU) budget. Meanwhile, Giro Entities/Institutions and Individuals tend to be used in customer business transaction activities. Furthermore, to ensure customer convenience and security in transactions, it is supported by the latest and modern banking service facilities, including multiconnection ATM/ Debit Cards (GPN and ATM Bersama), Mobile Apps, Cash Management System and others. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 146
  148. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e (in million rupiah) 2020 Description Nominal 2019 Account Units Nominal Growth Account Units Nominal Account Units Wadiah Giro 72,222 1,790 74,160 1,950 (1,938) (160) Regional/Central Gov. 29,677 139 60,149 381 (30,472) (242) Institution/Company 37,178 433 13,069 370 24,109 63 Individual 5,368 1,218 942 1,199 4,425 19 Mudharabah Giro 518,209 2,293 688,032 2,228 (169,823) 65 Regional/Central Gov. 281,856 681 378,249 632 (96,393) 49 Institution/Company 218,950 1,514 302,805 1,497 (83,855) 17 Individual Total 17,402 98 6,978 99 10,424 (1) 590,431 4,083 762,192 4,178 (171,761) (95) Source: Bank NTB Syariah Financial Report Chart of iB Amanah Giro (in million rupiah) 688,032 518,209 72,222 74,160 2,228 2,293 1,790 Wadiah Giro 1,950 Mudharabah Giro Wadiah Giro 2020 Nominal Mudharabah Giro 2019 Account Units Nominal Account Units In 2020, Bank NTB Syariah managed to raise funds in the iB Amanah Giro product amounting to IDR590,431 million, less than IDR171,761 million or -22.54% (yoy) compared to the realization of IDR762,192 million in the previous year. Likewise, the number of accounts realized was less than in 2020 or 95 accounts, namely from 4,178 accounts in 2019 to 4,083 accounts in 2020. This decrease was mainly due to the iB Amanah Current Account which tended to be dominated by Regional Government Giro in December. has entered the final cycle of using the budget so that it is reduced due to several mandatory costs that must be incurred such as payment of ASN salaries. Meanwhile, Giro for Agencies/Institutions and Individuals has decreased because the business and project transaction activities in December have been completed or are entering the maturity period of the activities. 2. iB Amanah Savings iB Amanah Savings is a fundraising product whose transaction activities are based on the principles of Wadiah and Mudharabah which consists of Tambora iB Amanah, Taharah iB Amanah, Simpeda iB Amanah, Simpanan Pelajar iB Amanah, TabunganKu iB Amanah, and Tabungan BSA. The product that is relied upon to increase the portion of cheap funds is Tambora iB Amanah which is the pride product of Bank NTB Syariah which reflects the special features of the West Nusa Tenggara region. As well as Taharah iB Amanah products that are intended for planning and depositing the cost of Hajj and Umrah. 147 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  149. (in million rupiah) 2020 Description 2019 Account Units Nominal Nominal Growth Account Units Nominal Account Units Wadiah Savings 75,751 384,932 68,693 376,275 7,058 8,657 Tambora iB Amanah 20,620 14,514 10,085 2,373 10,535 12,141 Taharah iB Amanah 19,099 9,135 17,475 7,674 1,624 1,461 Simpeda iB Amanah 8,500 5,487 15,725 10,231 (7,225) (4,744) Simpanan Pelajar iB 1,632 14,742 1,656 14,391 (24) 351 25,895 341,025 23,747 341,578 2,148 (553) Amanah TabunganKu iB Amanah BSA Savings 4 29 4 28 - 1 Mudharabah Savings 2,115,527 533,299 2,472,348 516,473 (356,821) 16,826 Tambora iB Amanah 935,985 191,265 774,072 124,978 161,913 66,287 Taharah iB Amanah - - - - - - Simpeda iB Amanah 884,945 102,064 1,415,127 160,128 (530,182) (58,064) Simpanan Pelajar iB 4,832 64,844 5,160 64,796 (328) 48 289,671 174,248 277,880 165,768 11,791 8,480 Amanah TabunganKu iB Amanah BSA Savings Total 94 878 109 803 (15) 75 2,191,278 918,230 2,541,041 892,748 (349,763) 25,483 Source: Bank NTB Syariah Financial Report Chart of iB Amanah Savings (in million rupiah) Wadiah Savings 2020 2019 Mudharabah Savings 75,751 384,932 68,693 Account Units 376,275 Nominal 2020 2019 Account Units 2,115,527 533,299 2,472,348 516,473 Nominal Realization of savings in 2020 was recorded at IDR 2,191,278 million, less than IDR 349,763 million or -13.76% (yoy) compared to the previous year's realization of IDR 2,541,041 million. In contrast, the number of accounts increased by 25,482 accounts, from 892,748 accounts in 2019 to 918,230 accounts in 2020, an increase of 2.85%. One of the external factors that triggered the decline in savings performance in 2020 was the COVID-19 pandemic outbreak since the beginning of 2020 which disrupted economic activity throughout Indonesia without. Limiting economic activity as a measure to deal with COVID-19 will reduce global economic growth in 2020 and disrupt banking activities as intermediary institutions. However, in 2020 Bank NTB Syariah has taken several strategic steps in improving the performance of saving savings comprehensively, including penetrating the market in strategic locations intensively by targeting the retail customer segment and the upper middle class, continuing to maintain good relationships with prime customers through regular visits intense to customers, enhancing closer strategic partnerships with both government agencies and educational institutions, developing and improving an integrated information technology system to improve services to the public in the digital era through improving the quality of e-channel services that can reach more customers. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 148
  150. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e In addition , Bank NTB Syariah continues to improve the quality of banking service products as well as add innovations for banking transactions that are solutions for customers as users of financial services. One of these has been done through the addition of the potential segmentation of the iB Amanah Tambora Savings into Tambora Rencana, Business and Prestige iB Amanah which was released in mid-October 2020, equipped with attractive features according to the needs of PT customers. Bank NTB Syariah. The addition of the Tambora Savings segmentation also boosted the increase in the number of savings accounts in 2020 by 25,482 accounts compared to 2019. As for the performance of the Tambora Rencana, Tambora Bisnis and Tambora Prestise Savings products in 2020 a total of managed to reach IDR 143,133 million from a total of 22,609 accounts with details as follows: (in million rupiah) Description Nominal 1,267 Tambora Rencana iB Amanah Tambora Bisnis iB Amanah Tambora Prestise iB Amanah Total 3. Tambora Savings Account Units 1,828 140,719 20,779 1,147 2 143,133 22,609 1,267 Rencana 1,828 140,719 Bisnis 20,779 Prestise 1,147 2 Account Units Nominal iB Amanah Deposit A savings with a certain period of time that can be a choice of investment products for public funds by prioritizing the convenience and security of financial transactions as well as providing competitive profit sharing using the mudharabah contract. These investment products are intended for individual and non-individual customers with flexible term options as needed, namely 1,3,6,12 and 24 months. (in million rupiah) 2020 Description Nominal 2019 Account Units 25,410 63,869 4,206,648 396 395,150 2,718 4,627,208 3,121 Individual Total Growth Account Units 7 Regional/Central Gov. Institution/Company Nominal Nominal Account Units 108 (38,459) (101) 3,035,864 605 1,170,784 (209) 413,392 2,856 (18,242) (138) 3,513,126 3,569 1,114,082 (448) Source : Bank NTB Syariah Financial Reports Grafik Tabel Deposito iB Amanah (in million rupiah) Government Institution/Company 7 2020 2020 25,410 108 2019 Nominal 2019 63,869 Account Units Individual 396 4,206,648 605 Nominal 3,035,864 Account Units 2,718 2020 395,150 2,856 2019 Nominal 413,392 Account Units Realization of iB Amanah Deposit Savings in 2020 was recorded at IDR4,627,208 million or an increase of 31.71% compared to 2019 which was realized at IDR3,513,126 million, although in terms of the number of accounts it became smaller in 2020, namely 448 accounts. This increase was dominated by institutional / business entity accounts which were the largest contributor to the increase in deposit performance from the nominal side, amounting toIDR1,114,082 million. Through this, it can be concluded that in 2020 Bank NTB has carried out a massive and structured strategy for promotion and market penetration to potential customers who have business activities as well as educational institutions and other institutions, both government and private institutions. In addition, this increase is also supported by the implementation of cooperation through strategic partnerships with various partnership institutions both with private and government parties. Meanwhile, the realization of iB Amanah Time Deposit deposits is based on the following time periods: 149 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  151. (in million rupiah) 2020 Description Nominal 2019 Account Units Nominal Growth Account Units Nominal Account Units 1-month deposit 226,114 547 1,325,805 680 (1,099,691) (133) 3-month deposit 1,265,361 1,142 540,457 1,539 724,904 (397) 6-month deposit 1,222,721 869 943,464 738 279,257 131 12-month deposit 1,911,483 533 700,553 566 1,210,930 (33) 1,529 30 2,847 46 (1,319) (16) 4,627,208 3,121 3,513,126 3,569 1,114,081 (448) Over 12 months Deposit Total Source : Bank NTB Syariah Financial Reports 1-month deposit 3-month deposit 547 2020 2020 226.114 533 2020 2020 1,222,721 1.539 2019 1,325,805 12-month deposit 869 1,265,361 680 2019 6-month deposit 1.142 738 943,464 In ensuring the achievement of business targets in 2020, Bank NTB Syariah implemented several strategies that were deemed adequate to be able to support the performance and consistency of Bank NTB Syariah expansion towards increasing retail funds and continuing to collect corporate funds to maintain liquidity. The strategies carried out by Bank NTB Syariah in raising Third Party Funds in 2020 include: 1. Consistently and effectively conduct socialization/education about Sharia Banking and of course the invitation to "Come back to Bank NTB Syariah, Insha Allah, blessings" through the following activities: a. Improve service to customers by making more intense visits to existing and new customers; b. Conducting Islamic financial literacy activities for the public in order to increase public understanding of Islamic financial products and services, increase people's ability in better financial planning, increase the number of users of Islamic financial services, and provide confidence to the public that the profit sharing pattern of Islamic banking is Insha Allah will be better; c. Conducting comprehensive socialization of financial products and services to both private and government institutions and institutions; d. Maximizing visual and non-visual promotion activities through announcements, social media, frontliners and call centers regarding the benefits and advantages of using the Bank's savings products & e-channel services; e. Optimizing the collection of DPK Retail through promotional programs for customers in the form of attractive gifts, merchandise and souvenirs. 1,529 566 46 2019 700,553 Account Units Spirit of Amanah, Optimistic and Growth in Sustainable Business 2020 2019 FUNDRAISING STRATEGIES 30 1,911,483 2019 540,457 over 12 month deposit 2,847 Nominal 2. Increase the penetration of Bank NTB Syariah in encouraging the use of non-cash transactions through the following activities: a. Conducting outreach to local governments and the community regarding the use of non-cash transactions at PT. Bank NTB Syariah s such as CMS Kasda, CMS Corporate, PBB online, online samsat E-Retribution, autodebet); b. Strengthen the realization of the use of the Kasda CMS, Corporate CMS, online PBB, online Samsat E-Retribution, Autodebet for Regional Expenditure and Revenue Transactions; c. Maximizing non-cash transactions to make salary payments, expenses routine spending, and others at Government Agencies (Pemda) and Private Agencies (BUMD, Private Companies) to prevent the spread of the COVID-19 virus through cash objects; d. Maximizing socialization and penetration of the use of JPP, Debit/ATM Cards, Mobile Banking and SMS Notifications to all ASNs and CASNs; e. Optimizing the role of digital banking for customer transaction convenience during the Covid 19 pandemic; f. Strengthening the realization of e-channel use through e-channel activation programs at government and private agencies; g. Improve the types and quality of Bank NTB Syariah e-channel transactions through ATM, EDC, Mobile banking and SMS Banking services; h. Enriching the types of Retail Bank NTB Syariah DPK products by targeting the needs and dynamics of banking development, including: E-Wallet (digital wallet), revitalizing Tambora products into Tambora Rencana, Business and Prestis iB Amanah and preparing “Bank NTB Syariah Priority” services. PT Bank NTB Syariah. 2020 Annual Report 150
  152. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e 3 . Forge strategic partnerships that have the potential to increase the collection of Third Party Funds, namely: a. Cooperating with all Regional Governments in the NTB Province in the context of Optimizing Regional Revenues; b. Play an optimal role in supporting the Regional Government as the holder of regional cash which is a captive market for the bank. c. Increase the strategic cooperation that has been initiated by the Bank with other partnership institutions; d. Taking an intense approach to shareholders in relation to the Bank's efforts to increase institutional resilience and strong capital; e. Promote continuous socialization of Taharah iB Amanah savings products with hook up the Hajj Guidance Group (KBIH) and Haj and Umrah Travel in NTB Province; f. Increase penetration and optimization of the functions of Bank NTB Syariah as a recipient of BPS BPIH deposits through cooperation with Islamic boarding schools, communities, government agencies and private agencies; 4. Revitalizing fundraising activities as a driver for the business of Bank NTB Syariah through the following activities: a. Carry out the pipeline/sales plan that has been compiled consistently and implemented by the Branches and Sub-Branches with full commitment and responsibility; b. Optimizing the functions of CS, Teller, Security Guard and Sales Funding as a medium to inform the benefits of NTB Syariah Bank Retail DPK products; c. Prioritizing the use of the tagline “iB Amanah” as a characteristic feature of every Bank NTB Syariah product; d. Development of the DPK business, especially in retail funds, through the establishment of a marketing organization unit, preparation of reward & punishment programs and of course strengthening the competence and communication skills of marketing officers of Bank NTB Syariah; e. Consistently maximizing and monitoring the Bank's marketing team for funding activities both at Head Office & Branches; f. Optimizing the collection of TPF through the provision of promotional tools for products and services such as brochures, pamphlets, banners, etc. as a support for effective marketing tools at Branch and Sub-Branch Offices. FINANCING Conditions in 2020 are a test year for the Indonesian economy, the government calls on fishical distancing, restrictions on short-distance communication, crowds, shops and other public areas are restricted in their activities, schools are closed, people are encouraged to stay at home more. All of these are new challenges for economic actors, business actors including financial institutions, including Bank NTB Syariah, must seek and find new strategies to get closer to the community, issue new products and strategies to maintain the existence of quality growth on a sustainable basis. Pademi Covid-19 is quite challenging, global uncertainty and the occurrence of an economic slowdown in most countries in the world which have an impact on domestic conditions. Bank NTB Syariah must adjust to these conditions, always focus on healthy business growth through fast, precise and simple process financing is the best choice. In accordance with the intended use, in general the distribution patterns of each type of product have different customer objectives and segments. Alhamdulillah, Pandemic and certainty seem to be a momentum for thinking, creativity and developing new innovations that can bring NTB Syariah Bank to continue to grow sustainably both in terms of assets, financing, raising funds and even being able to make improvements in terms of quality of financing distribution The following is presented, the nominative achievements of Bank NTB Syariah 2020 versus 2019; (in million rupiah) Nominal Description Growth 2020 2019 Productive 616,136 480,568 135,568 28.21% Working Capital 429,050 429,049 127,224 42.15% Investation 187,086 187,087 8,244 4.67% Consumptive 5,794,748 5,101,530 693,218 13.59% Total 6,410,884 5,582,097 828,786 14.85% Nominal % Source : Bank NTB Syariah Financial Reports Graph of Fund Distribution/Financing (in million Rupiah) Productive Consumptive 616,136 480,568 151 PT Bank NTB Syariah. 2020 Annual Report 5,794,748 5,101,530 2020 2019 Spirit of Amanah, Optimistic and Growth in Sustainable Business
  153. Even though 2020 was a di fficult year for banks, Bank NTB Syariah was able to maintain healthy business performance. Bank NTB Syariah has disbursed financing amounting to IDR6,410,884 million or a growth of 14.85% (yoy). Where the realization of productive financing in 2020 amounted to IDR 616,138 million, an increase of IDR135,068 million or an increase of 28.08% compared to the previous year of IDR480,568 million. This is inseparable from the innovations that have become banking strategies, the support of the local government as stake holders and the trust of the people of West Nusa Tenggara. In order to realize the vision of becoming a Safe, Prominent Sharia Commercial Bank and Community Choice, Bank NTB Syariah continues to get closer to the community, so that its existence is felt, especially for Low Income Communities by channeling FLPP financing as a consumer financing product, in accordance with the Financial Services Authority Regulation. (POJK) No. 17/POJK.03/2018 dated 15 August 2018 related to the Government's efforts to increase economic growth in encouraging the growth of the housing sector and the tourism sector, which stipulates that home ownership financing that can be calculated in fulfilling the obligation to extend credit / financing to productive businesses is at most 20 % of total lending / financing obligations to productive businesses. For FLPP financing disbursed by Bank NTB Syariah amounting to IDR170,003 to 1,685 customers. PRODUCTIVE FINANCING The classification of productive financing for Bank NTB Syariah based on the intended use and customer segment is as follows: 1. Categories based on the Purpose of Financing The purpose of productive financing is divided into 2 (two), namely for the purpose of increasing the working capital and/or business investment of the Customer. The following is the financing performance based on the following financing objectives: (in million rupiah) Nominal Description 2020 Murabahah receivables - Net Working Capital Growth 2019 Nominal % 182,941 169,480 13,648 7.94% 59,053 55,303 3,750 6.78% Investation 123,889 114,177 9,712 8.51% Musyarakah Financing 422,380 311,088 111,292 35.78% Working Capital 369,185 246,522 122,663 49.76% Investation 53,195 64,566 (11,370) -17.16% Qard Financing 10,814 - 10,814 100.00% 811 - 811 100.00% 10,033 - 10,033 100.00% Total Receivables and Financing - Net 616,136 480,568 135,568 28.21% Working Capital 429,165 301,825 127,224 42.15% Investation 176,843 178,743 8,344 4.67% Total 616,136 480,568 135,568 28.21% Working Capital Investation Source: Bank NTB Syariah Financial Report Grafik Pembiayaan berdasarkan tujuan pembiayaan (in million rupiah) Working Capital 429,165 Investation 176,843 301.825 2020 178,743 2019 Realization of working capital financing in 2020 amounting to IDR429,165 million, an increase of IDR125,731 million from 2019 amounting to IDR303,434 million and at, and the realization of investment financing in 2020 amounted to IDR176,844 million, decreased by IDR790 million from the realization in 2019 of IDR177,633 million. The increase in working capital financing was due to: 1. Realization of financing to local governments for the development of regional facilities and infrastructure. 2. Tunas Sejahtera financing is channeled to MSMEs in the trade sector, other productive sectors such as the agricultural sector with payment patterns during the harvest season such as cultivation of corn, garlic, onions, and cattle fattening. 3. Bank NTB Syariah also makes it easy for contractors to procure goods and services in order to meet the needs of the community in a COVID-19 pandemic situation. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 152
  154. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e 2 . Customer Segments based Categories The productive financing customer segment is divided into 3 (three) based on the maximum financing, namely: a. The Micro segment is financing for additional working capital and / or customer business investment with a maximum of up to IDR50 million and is intended for individual customers with a micro business scale and aims to empower the community, in the micro segment there is the Ultra Micro Segment, which is financing for business working capital needs. customers with a maximum ceiling of IDR10 million aimed at individual customers for cart businesses or ultra-micro businesses. b. Small Business (Retail) is financing for additional working capital and / or customer business investment with a maximum of IDR 50 to IDR2,500 million and is intended for individual or business entity customers. In general, customer financing in this segment is included in the category of Small and Medium Enterprises (SMEs) with the main target of business actors who have the potential to develop and have good credibility. This segment focuses on handling trickledown businesses originating from the commercial segment or fostering customers from the micro segment with an increasing business scale. This segment financing is carried out through the Bank NTB Syariah office network or financing with an executing pattern such as Sharia Financial Institutions (BPRS and Sharia Cooperatives) in collaboration with Bank NTB Syariah. c. Large Medium Enterprises (Commercial) is financing for additional working capital and/or customer business investment with a maximum of more than IDR2,500 million and is intended for Business Entity customers, including Regional-Owned Enterprises (BUMD), National and Private Corporations. This business segment also provides syndicated financing together with other banks. This segment financing is carried out directly through the NTB Syariah Bank Financing Division or through a syndicated financing scheme in collaboration with other Sharia Banks. The following is the development of financing performance based on customer segments: (in million rupiah) Nominal Description Murabahah Receivables Growth 2019 2020 Nominal % 182,941 169,480 13,461 7.94% Micro Segment 14,588 24,668 (10,099) -40.94% Small Segments 76,890 118,450 (41,560) -35.09% Medium and Large Segments 91,483 26,363 65,120 247.01% 422,380 311,088 111,292 35.78% Micro Segment 30,331 20,070 10,262 51.13% Small Segments 89,954 62,821 27,134 43.19% Musyarakah Financing Medium and Large Segments 302,094 228,197 73,897 32.38% Qard FInancing 10,814 - 10,814 100.00% Micro Segment 814 - 814 100.00% - - - 0% Small Segments 10,000 - 10,000 100.00% 616,136 480,568 135,568 28.21% Micro Segment 45,714 44,737 977 2.18% Small Segments 168,844 181,270 (14,426) -7.96% Medium and Large Segments Total Receivables and Financing Medium and Large Segments 403,577 254,560 149,017 58.54% Total 616,136 480,568 135,568 28.21% Source: Bank NTB Syariah Financial Reports Graph of financing development based on customer segments (in million rupiah) Small Micro 45,714 168,844 44,737 181,270 2020 Medium & Large 403,577 2019 254,560 153 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  155. 3 . Product Types and its usage based Categories The growth of financing based on usage and product can be attached as follows: (in million rupiah) Nominal Description Murabahah Receivables Growth 2019 2020 Nominal % 182,941 169,480 13,461 7.94% Tunas Sejahtera iB Amanah 9,706 268 9,438 358.21% iB Amanah Working Capital 50,371 55,035 (4,664) -8.47% iB Amanah Investation 66,185 114,177 (47,992) -42.03% 100.00% iB Amanah Syndication 56,679 - 56,679 Musyarakah Financing 422,380 311,088 111,292 35.78% Tunas Sejahtera iB Amanah 67,884 23,956 43,928 183.37% iB Amanah Working Capital 301,999 222,617 79,382 35.66% 47,229 57,343 (10,114) -17.64% 5,268 7,172 (1,904) -26.54% 10,814 - 10,814 100.00% Tunas Sejahtera iB Amanah - - - - iB Amanah Working Capital iB Amanah Investation iB Amanah Syndicationh Qard Financing 814 - 814 100.00% iB Amanah Investation 3 - 3 100.00% iB Amanah Syndication 10,000 - 10,000 100.00% 616,136 480,568 135,568 28.21% 220.30% Total Receivables and Financing Tunas Sejahtera iB Amanah 77,590 24,224 53,365 iB Amanah Working Capital 353,181 277,652 75,530 27.20% iB Amanah Investation 113,417 171,520 (58,102) -33.88% iB Amanah Syndication 71,948 7,172 64,776 903.19% 616,136 480,568 135,568 28.21% Total Source: Bank NTB Syariah Financial Reports Graph of financing development based on product type and its usage (in million Rupiah) 5,794,748 5,101,029 616,136 480,568 2019 2020 Productive Spirit of Amanah, Optimistic and Growth in Sustainable Business 2019 2020 Consumer PT Bank NTB Syariah. 2020 Annual Report 154
  156. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e 4 . Economic Sector based Categories In terms of financing based on the economic sector, in 2020 there will be a high growth in financing originating from the construction sector of IDR188,558 million or a growth of 341.21% compared to the realization in 2019 of IDR42,736 million. This increase was due to the Bank's continued efforts to increase its productive financing portfolio, including by collaborating with housing development companies to finance construction working capital in line with the distribution of FLPP KPR. Further increase in the manufacturing sector, which experienced growth compared to the previous year's realization of IDR18,362 million or grew 36.03% from the realization of IDR13,498 million. The social services, socio-cultural, entertainment, and other sectors also experienced growth compared to the previous year's realization of IDR3,285 million or grew 24.07% from the realization of IDR2,648 million. The following is the development of the financing performance based on the economic sector: (in million rupiah) Nominal Description Agriculture, hunting and forestry Fishery Mining and excavation Processing industry Electricity, Gas and Water Growth Des 2019 Des 2020 Nominal % 108,739 98,520 10,219 10.37% 4,658 4,153 505 12.15% 1,828 1,955 (127) -6.48% 18,362 13,498 4,864 36.03% 6,285 7,213 (928) -12.86% Construction 188,558 42,736 145,822 341.21% Wholesale and retail 227,968 236,071 (8,103) -3.43% Provision of Accommodation and Food and Drink 5,374 7,461 (2,087) -27.97% Transportation, Warehousing and Communication 1,125 1,202 (77) -6.42% 413 850 (437) -51.45% 6,767 8,137 (1,370) -16.84% - - - - Financial Intermediary Real Estate, Rental Business and Corporate Services Government Administration, Defense and Mandatory Social Security Educational Services 2,397 5,370 (2,973) -55.36% 39,003 49,181 (10,179) -20.70% 3,285 2,648 637 24.07% 1,375 1,485 (111) -7.45% - - - - Limitation Unclear Activities - - - - Household - 88 (88) -100.00% Other Non-Business Field - - - - 616,136 480,568 135,568 28.21% Health Services and Social Activities Community, Social Culture, Entertainment and Other Individual Services Personal Services Serving Households International Bodies and Other International Extra Bodies Total Source: Bank NTB Syariah Financial Reports 155 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  157. 5 . Financing Agreement based Categories Productive financing has several alternative financing agreements that are adjusted to the type of transaction between Bank NTB Syariah and the Customer. Some productive financing agreements that are widely used are as follows: a. Murabahah contract is a financing agreement for the purpose of buying and selling between Bank NTB Syariah and the customer. Bank NTB Syariah buys the goods needed and sells them to the Customer at the acquisition price plus the profit margin agreed between the Bank NTB Syariah and the Customer. b. Musyarakah contract or commonly called Al-Musyarakah is a cooperation agreement between Bank NTB Syariah and the Customer for a particular business where each party contributes capital, with an agreement that the benefits or risks will be borne together in accordance with the agreed profit sharing ratio. c. Qard contract or Al-Qardh is a loan agreement to the costumers of Bank NTB Syariah with a condition that the costumer is obligated to return the funds receieved on time as the agreement between Bank NTB Syariah and the costumer. d. Ijarah contract is a lease transaction for an item and or wage wages for a service within a certain time through lease payments or service fees between Bank NTB Syariah and the Customer e. Other financing agreements are adjusted to the type of transaction and do not conflict with the provisions of sharia principals. The development of the financing performance based on the financing agreement is as follows: (in million rupiah) Nominal Description Growth 2019 2020 Nominal % Murabahah 182,941 169,480 13,461 7.94% Musyarakah 422,380 311,088 111,292 35.78% Qard 10,814 - 10,814 100.00% Ijarah - - - - Total 616,136 480,568 135,568 28.21% Source: Bank NTB Syariah Financial Reports 311,088 Graph of Development of financing performance based on the contract (in million Rupiah) 286,876 182,941 169,480 10,814 2019 2020 Murabahah Spirit of Amanah, Optimistic and Growth in Sustainable Business 2019 2020 Musyarakah 2019 2020 Qard PT Bank NTB Syariah. 2020 Annual Report 156
  158. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e 6 . Small and Medium Business Segments based Financing Categories The development of the Micro, Small and Medium Enterprises (UMKM) group cannot be separated from the support of the banking industry, especially in terms of channeling financing to these groups. Apart from being able to encourage the economy of UMKMs, it is a potential market for the Bank to increase the expansion of financing distribution. Realization of providing financing to UMKMs for 2020 amounted to IDR464,478 million. Thus, the distribution of UMKMs financing to total financing as a whole reached 7.52%. Based on the scale of financing, the distribution of UMKMs financing is dominated by medium-sized business financing reaching IDR251,919 million with a composition of 46.18%, financing for small businesses amounting to Rp.181,270 million or 43.16% of total UMKM financing, and financing for micro-businesses of IDRIDR 44,737 million or 10.65% of the total UMKM financing. The following is the development of the financing performance based on the Micro, Small and Medium Enterprises segment: (in million rupiah) Nominal Description Growth Des 2019 Des 2020 Nominal % Micro 45,714 44,737 977 2.18% Small 166,844 181,270 -14,426 -7.96% Medium 251,919 193,953 57,967 29.89% Total MSMEs Financing 464,478 419,960 44,518 10.60% Source: Bank NTB Syariah Financial Reports Graph of financing development based on micro and small business segments (in million Rupiah) 251,919 193,953 181,270 166,.844 45,714 44,737 2020 2019 Micro 2019 2020 2019 Small 2020 Medium Realization of providing financing to UMKMs for 2020 amounted to IDR464,477 million. Thus the distribution of UMKM financing to total financing as a whole. Based on the scale of financing, UMKMs financing distribution is still dominated by medium-sized business financing reaching IDR 251,919 million, financing for small businesses amounting to IDR166,844 million or a decrease compared to the previous year, and financing for micro-businesses amounting to IDR45,714 million of the total UMKM financing. Distribution of MSMEs Products: (in million rupiah) Nominal Description Des 2020 Des 2019 Growth Nominal % Tunas Sejahtera iB Amanah 77,590 24,224 53,365 220.30% iB Amanah Working Capital 305,377 267,852 37,525 14.01% 81,511 127,884 (46,372) -36.26% 464,478 419,960 44,518 10.60% Investasi iB Amanah Total Source: Bank NTB Syariah Financial Reports 157 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  159. CONSUMTIVE FINANCING Synergy , Collaboration and Continuous Innovation are the main capital of Bank NTB Syariah in making breakthroughs and financing business opportunities, through improving financing SOPs, adjusting to market demand, being able to provide new hope to participate in participating in the success of the government program, namely National Economic Recovery through distribution consumptive financing in a segment that is not only focused on the State Civil Service (ASN) but also for national private employees, local private companies, BUMN / BUMD employees, BUMN / BUMD subsidiaries, professionals and entrepreneurs, the general public has low income/MBR so that it opens up space as wide as possible for the community to partner and become part of the NTB Syariah Bank to jointly carry out banking practices in accordance with sharia principles. Bank NTB Syariah also continues to develop cooperation with housing developers / developers, jointly conduct Developer Gathering, Organizing a thunderous expo exhibition, supporting the Coordination Meeting and the Annual Meeting of the Developer Association / REI in West Nusa Tenggara as a form of Bank NTB Syariah's concern for efforts to continue to grow, participate in building the regional economy through the Banking Business. The following can be presented the performance of consumer financing based on product types in 2020 as follows: (in million rupiah) Nominal Description FLPP iB Amanah Sejahtera iB Amanah Growth 2019 2020 Nominal % 412,129 170,277 241,853 142.04% 4,817,069 4,139,727 677,342 16.36% Kendara iB Amanah 912 231 681 294.81% 3,122 2,101 1,021 48.60% Multiguna iB Amanah 144,480 78,612 65,867 83.79% Others 417,036 710,581 (292,545) -41.31% 5,794,748 5,101,530 693,218 13.59% Bale iB Amanah Total Source: Bank NTB Syariah Financial Reports 2020 Consumtive Financing Performance (in million Rupiah) 2019 Multiguna iB Amanah Kendara iB Amanah Bale iB Amanah 912 231 3,122 2,101 Sejahtera iB Amanah FLPP iB Amanah 4,817,069 4,139,727 Improvement of SOP Consumptive financing products are continuously developed and expanded with the aim of being able to serve and meet all customer needs through financing partners of Bank NTB Syariah. The realization of consumer financing in 2020 includes: 1. Bale iB Amanah Financing, with the realization of the achievement in 2020 amounting to IDR3,122 million or experiencing a growth of IDR1,021 million compared to the previous year's position of IDR2,101 million. Bank NTB Syariah will continue to strive to expand the market share of Bale iB Amanah, through cooperation in organizing joint promotions and joint events in various potential areas with developers. Bank NTB Syariah will also continue to show its commitment to increasing competitiveness by prioritizing service quality, process speed and innovative products according to customer expectations and needs. 2. Kendara iB Amanah Financing, with actual disbursement of IDR912 million or an increase of IDR681 million or 294.77% compared to the previous year. Bank NTB Syariah continues Spirit of Amanah, Optimistic and Growth in Sustainable Business 412,129 170,277 144,480 78,612 Others 417,036 710,581 to strive to increase the speed of the financing disbursement process, focus on improving service quality, accelerate the realization of expanding marketing coverage to various regions throughout NTB, and strengthen relationships with dealer/showroom partners, as well as cross selling to internal customers. 3. Multiguna iB Amanah Financing, with realization of disbursement of IDR32,388 million, an increase of IDR28,332 million or 698.34% from the previous year period. This increase was due to Bank NTB Syariah continuing to strive for the best, expanding the target market segment, giving to entrepreneurs, contract/honorary employees, CPNS, and professionals who meet the requirements. This financing is expected to meet the needs of the wider community, especially the people of NTB, with a variety and value of needs that vary according to the principles of Sharia. In the future, this product is expected to be able to answer the challenges of society, especially the people of West Nusa Tenggara, to meet their consumptive needs in meeting their consumptive needs. PT Bank NTB Syariah. 2020 Annual Report 158
  160. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e 4 . Sejahtera iB Amanah Prosperity Financing, with disbursement of IDR2,979,262 million, an increase of IDR1,983,607 million or 199.23% compared to the previous year's period of IDR995,655 million. This increase was due to the fact that Bank NTB Syariah continued to strive to adjust product policies according to customer demand, and could not be separated from the improvement of contracts to facilitate financing to customers, namely Murabahah for purchases of consumer goods or take over loans from Conventional Banks, Ijarah for multi-service transactions, including educational services, health, and Musyarakah Mutanaqisah (MMQ) for refinancing transactions on current financing or take-over financing from other banks.. 5. FLPP iB Amanah Financing, with realized disbursement of IDR412,129 million, an increase of IDR241,853 million or 142.04% compared to the previous year's period of IDR170,277 million. This growth cannot be separated from efforts to develop the technical capabilities of SDI Bank NTB Syariah, also by expanding cooperation with the DPD REI NTB and other Housing Associations that have subsidized housing development businesses and cannot be separated from Central Government Support, especially the PPDPP ministry which provides opportunities for Bank NTB Syariah. in the form of a FLPP housing quota to distribute housing finance to Low-Income Communities / MBR. 6. The financing of KSG, KSG MMQ and other financing seems to have decreased, but this is due to the fact that there are products that are no longer marketed by Bank NTB Syariah because they have changed their name to new products such as KSG to Sejahtera iB Amanah. So that, in real terms, it can be counted as a product that is still growing. 159 PT Bank NTB Syariah. 2020 Annual Report FUNDING DISTRIBUTION STRATEGIES As for the financing distribution strategy that will be carried out by Bank NTB Syariah to achieve the plan set in 2020, namely: 1. Continue to develop consumer financing distribution, among others by maintaining and maintaining ASN financing as a captive market through competitive policies and pricing. 2. Developing a supply chain system in channeling financing to several institutions/agencies, including: hospitals, schools/universities, and other potential middle segments, collaborating for the distribution of FLPP financing and/or construction financing for housing development to developers, increasing distribution other consumer products to the general public 3. To more aggressively acquire financing to ASN Prepsioners and Retirees 4. Completing the SOP and other provisions, in order to meet market demand 5. Opening cooperation with Fronting Agents as special marketers to penetrate the market and acquire financing for pre-retirees and retirees 6. Optimization of units in the marketing of financing, especially in Sub-Branches and Surabaya Branches, which previously focused more on marketing Third Party Funds. 7. Improving the Financing process by simplifying financing products, progressively fulfilling the number and competence of SDI, making improvements to product features, strengthening administrative order and monitoring financing, developing/expanding customer segments; 8. Distributing productive financing, including channeling construction financing for housing development, channeling financing to large entrepreneurs for business development, collaborating with communities of MSMEs and Integrated Business Service Centers (PLUT NTB), distributing KUR financing to leading sectors in NTB, including sectors agriculture, livestock, fisheries, trade and home industry, and distribution of regional infrastructure financing and regional government counterpart contractors working on regional government projects; Spirit of Amanah, Optimistic and Growth in Sustainable Business
  161. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 160
  162. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e TREASURY SERVICES Throughout 2020 the Covid-19 pandemic had an extraordinary impact on humanity , economies and finances worldwide. It is remarkable that the scale and speed of the spread of the pandemic to 138 countries around the world, far exceeding previous pandemics (SARS and MERS). This triggered both economic and non-economic factors which resulted in a slowdown in the world economy as a whole. The speed and progress in dealing with the Covid-19 pandemic determines the process of economic recovery. Global economic performance continues to show improvement, and is projected to pick up even further in 2021. The improvement in the world economy is driven by increased mobility and the impact of continued policy stimulus in various countries, particularly the United States (US) and China. The development of a number of early indicators in November 2020 confirmed the ongoing improvement in the global economy. The increase in manufacturing and services Purchasing Managers' Index (PMI) continued in the US and China, consumer and business confidence continued to improve in the US, China and the European region, and unemployment rates declined in many countries. With these developments, the global economic recovery is predicted to continue with growth in the range of 5.0% in 2021, after contracting by 3.8% in 2020. The pace of global economic recovery in the future will be influenced by the implementation of vaccinations, increased mobility, and continued policy stimulus. fiscal and monetary. The improvement in the global economy prompted an increase in trade volume and world commodity prices in line with previous forecasts. Meanwhile, global financial market uncertainty is predicted to ease due to positive expectations for the global economic outlook in line with the availability of vaccines, amid conditions of large global liquidity, low interest rates and the downward trend in the US dollar exchange rate. This development again increased capital flows to developing countries and encouraged the strengthening of currencies of various countries, including Indonesia. Domestic economic growth is predicted to continue gradually improving and will pick up in 2021. This development is indicated by the continued positive performance of a number of indicators in November 2020, such as increased mobility in several regions, continued improvement in the Manufacturing PMI, and strengthening consumer confidence and expectations for income availability of employment opportunities, and business activities. In the future, vaccination and discipline in implementing the Covid-19 protocol are prerequisite conditions for the national economic recovery process. The improving prospect for the domestic economy is also supported by various policy steps aimed at encouraging (i) opening up productive and safe sectors nationally and in respective regions, (ii) accelerating fiscal stimulus, (iii) channeling bank credit from the side demand and supply, (iv) continued monetary and macroprudential stimulus, and (v) accelerated economic and financial digitization, particularly in relation to the development of MSMEs. Under these conditions, Indonesia's economic growth is predicted to start positively in the fourth quarter of 2020 and in the range of -1% to -2% in 2020, and further increase in the range of 4.8-5.8% in 2021. Bank Indonesia will continue to strengthen synergies. with the Government and related authorities in taking further policy steps so that the various policies adopted are more effective in promoting economic recovery. Tightening liquidity is one of the risks looming over banks amid the Covid-19 pandemic. This is because affected customers need to postpone paying installments through a restructuring program. Even though there is liquidity risk, it is not impossible for a bank to be able to get around its liquidity condition, especially not all debtors need financing relief. However, if banks can convince large customers not to withdraw and entrust their funds during a pandemic, then liquidity pressure will not occur. Liquidity management at Bank NTB Syariah is the responsibility of the Treasury Unit, with the main role of maintaining adequate liquidity and investing excess funds to get the most optimal income, in addition to the statutory reserve requirement (GWM), primary reserve and secondary reserve adequacy. with regulatory provisions, as well as several other ratios related to liquidity management. Primary Liquidity Management 1. Reserve Requirement/GWM 2. Cash Reserve Secondary Liquidity Ratio Maintenance Set Cash Reserves Limit Set Secondary Reserves Ideal Component: SBIS, SBSN 1. Backing Up Primary Reserve Liquidity Needs 2. Contributing Optimum Yield 3. Continuing Activity 4. Near Cash - No Risk Objectives Liquidity Reserve No Idle Fund Revenue Optimalization Cost of Maintaining Liquidity 161 PT Bank NTB Syariah. 2020 Annual Report Trade Off Cost from Insufficient Liquidity Spirit of Amanah, Optimistic and Growth in Sustainable Business
  163. In maintaining adequate liquidity , the Treasury manages the assets and liabilities of the bank so that it is able to make an optimal contribution to the diversification of bank income from revenue sharing and fee base income. The Bank's strategy carried out in 2020 is not much different from the previous period, namely to remain focused on optimizing profits through increasing investment in securities that provide the most optimal yield, especially in the current pandemic conditions where national financing growth shows weakening. To achieve this, in 2020 the Treasury has established a liquidity management strategy based on the following: 1. Investments in treasury instruments are carried out by taking into account the direction of movement of market returns in order to obtain the optimal yield level while still prioritizing liquidity needs. In 2020, the BI 7-day RR rate decreased by 125 bps, from 5% in January 2020 to 3.75% in December 2020. The policy of decreasing the BI 7-day RR rate affected the yield on money market instrument transactions, both between banks and capital market securities transactions; 2. Diversify investment portfolios into instruments that produce the most optimal yields; 3. Increasing Fee Based Income by optimizing the transaction services for State Revenue and payment systems for the BI RTGS and SKNBI; 4. Maintain the position of the reserve requirement liquidity ratio, FDR, LA / NCD, LA / DPK, RIM and PLM in accordance with the provisions of the authorities (Bank Indonesia and OJK) and bank internal regulations; TREASURY ACTIVITIES Treasury activities are the operational activities of the Bank in order to optimize the Bank's income from excess sources of liquidity fulfillment, other than those from channeling financing. In 2020, the Treasury business revenue target is IDR131.8 billion. As of December 31, 2020, investment income in the treasury business reached IDR137.6 billion or reached 4.40% of the target. The activities of the Treasury Division in 2020 are as follows: 1. Fund Placement Policy a. SIMA (Interbank Mudharabah Investment Certificate) An investment certificate issued by the issuing bank which is used as a means / underlaying of short-term investments (under 1 year) to borrow funds from the NTB Syariah Bank on the Sharia Interbank Money Market (PUAS) with a Mudharabah agreement. PUAS participants consist of conventional commercial banks, sharia commercial banks and sharia business units. Conventional commercial banks that are PUAS participants only function as fund owners (shahibul maal) and cannot be fund managers (mudharib) SIMA characteristics: 1) Can be issued in rupiah or foreign currency; Published scripless 2) A period of one day (overnight) up to 1 (one) year; 3) Ownership cannot be transferred before maturity; 4) Can be issued based on assets that have variable yields and/or assets that have fixed returns, according to the MUI DSN fatwa and/or sharia opinion from the authorities authorized to issue sharia fatwa and/or opinions; 5) In conducting SIMA transactions, it can be done directly and/or through a Brokerage Company with a Ju'alah contract; 6) Payment of SIMA profit sharing based on assets that have variable yields, is made on the first day of the beginning of the following month; Spirit of Amanah, Optimistic and Growth in Sustainable Business b. Sharia Interbank Mudharabah Deposits Placement Sharia Interbank Mudharabah Deposit Investment is not much different from deposits with other customers, the only difference is that the only culprit is between Banks, namely Bank NTB Syariah with Sharia Commercial Banks or Sharia Business Units with Mudharabah and time contracts. At maturity the borrowing bank will automatically send funds and profit sharing to the Bank NTB Syariah c. Placement in State Sharia Securities (SBSN) This is a placement made by Bank NTB Syariah in the form of securities based on sharia principles with varying tenor in rupiah currency issued by the Ministry of Finance through the Main Delaer in the form of PBS (Project Base Sukuk) series. The purpose of issuing SBSN or State Sukuk is to finance the state budget deficit and finance government-owned infrastructure projects. The State Sukuk with the PBS series uses the Ijarah Asset to be Leased agreement, in this agreement a structure is made that allows the government to lease assets (infrastructure projects) that will be realized in the future (according to the construction period), but the government can pay the project lease from the commencement of the period. construction in the form of payment coupons every 6 (six) months. d. Placement with Bank Indonesia Bank NTB Syariah conducts placement of funds (idle) at Bank Indonesia in the form of Open Market Operation (OPT) is a monetary policy implemented by Bank Indonesia for monetary control, which aims to support the achievement of monetary stability. The OMO referred to is the Sharia Absorption OPT conducted by BI to absorb excess liquidity in the Sharia Interbank Money Market. PT Bank NTB Syariah. 2020 Annual Report 162
  164. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e 1 ) Bank Indonesia Sharia Certificate (SBIS) Are short-term securities based on Sharia Principles in the rupiah currency issued by Bank Indonesia and cannot be traded on the secondary market; 2) Bank Indonesia Sukuk (BI Sukuk BI Sukuk is an alternative for Islamic banking in managing daily liquidity, especially for banks that have a lot of liquidity with short tenors. In addition, this is also an alternative for sharia banks to place excess liquidity and increase yield. 3) FASBIS Bank Indonesia Sharia Deposit Facility in Rupiah, hereinafter referred to as FASBIS, is a deposit facility provided by Bank Indonesia for BUS and UUS to place funds at Bank Indonesia in the context of a sharia deposit facility. FASBIS transactions are carried out using a wadiah contract. Bank Indonesia may provide compensation for the placement of BUS and UUS funds in FASBIS in the amount of the BI 7-day Reverse Repo Rate less 75 bps. Treasury Investment Composition 100% 80% 60% 40% 20% 0 Jan-19 Feb-19 Mar-19 SIMA Apr-19 May-19 Jun-19 Interbank Deposit Jul-19 Aug-19 SBSN Sep-19 Oct-19 Nov-19 Des-19 BANK INDONESIA Tahun 2020 Investment Instrument January February March April May November December 8.66% 9.93% 1.93% 1.36% 1.51% 0.00% 2.85% 0.00% 0.00% 0.00% 0.00% 4.31% 5.12% 4.44% 6.25% 8.57% 8.02% 9.82% 8.29% 6.23% 6.90% 6.42% 8.60% 87.85% 83.32% 80.26% 89.78% 88.10% 86.48% 89.14% 82.30% 100.00% 100.00% 100.00% 100.00% 100.00% SIMA 1.11% 4.53% 6.80% 10.37% 3.58% Interbank Deposit 0.00% 0.00% 2.93% 0.00% SBSN 9.21% 8.16% 5.13% 5.19% 89.68% 87.30% 85.13% 84.44% Bank Indonesia Total June July 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% August September October Investments in Treasury instruments are carried out by taking into account the availability or availability of investment nstruments, movement of market yields/interest rates and excess funds to obtain the most optimal income. So that the composition of treasury investment in 2020 will be dominated by placements with Bank Indonesia, particularly in securities instruments issued by Bank Indonesia and the Ministry of Finance. 2. Services Treasury is committed to optimizing the service transaction process and services through the Service Level Agreement in accordance with the standards of Bank Indonesia and other authorities while maintaining the prudential banking principle. Treasury services and services are as follows: a. Bank Indonesia National Clearing System (SKNBI) It is an electronic fund transfer system that includes debit clearing and credit clearing, which settlement of each transaction is carried out nationally. The clearing is an exchange of scripts or Electronic Financial Data (EFD) between clearing participants both on behalf of participants and on behalf of participating customers, the calculation of which is completed at a certain time. 163 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  165. b . Bank Indonesia-Real Time Gross Settlement (BI-RTGS) It is an electronic fund transfer service between participants in rupiah currency, the settlement of each transaction is carried out in real-time. c. State Revenue Service It is a service provided to customers for tax revenue transactions related to state revenue and is part of the Treasury and State Budget System. 3. Asset & Liability Management ALMA is a process of planning, implementing, and supervising banking operations on assets and liabilities that are coordinated and consequently carried out by always paying attention to the development of factors that affect banking operations, either from outside or structural factors originating from within (internal factors). ALMA implementation is intended to help banking management solve obstacles or take existing opportunities. The objectives of ALMA are as follows: a. Reasonable growth; b. Optimal income; c. Maintain adequate liquidity; d. Establishing reserve reserves just in case; e. Maintain public funds (DPK); f. Meet the needs of the community (Financing and Other Services) In addition, the functions carried out by the Asset and Liabilities Committee (ALCO) are tasked with assisting the Board of Directors in ensuring the optimum level of profitability and controlled liquidity risk, through the establishment of policies and strategies for assets and liabilities (assets and liabilities management). . During 2020, ALCO has held 8 (eight) meetings and has carried out its duties properly. In carrying out the functions of ALMA, the ALCO Committee is assisted by the Staff Supporting Group Asset Liability Management Committee (SSG-ALCO) which is a forum for supporting analysis studies and preparing for meetings held by ALCO in the context of managing the asset & liability management process. 4. Counterparty Relationship In carrying out business processes, the Treasury Division is obliged to maintain good relations with sustainable counterparties with the aim of facilitating access to information traffic and business communication, whether carried out between fellow Regional Development Banks throughout Indonesia (BPD SI), Sharia Commercial Banks, Commercial Banks, Authorities , Other Financial Institutions and other partners. This is intended for the Bank to mitigate potential risks that arise, such as liquidity risk, market risk, reputation risk and others. Spirit of Amanah, Optimistic and Growth in Sustainable Business EXPLANATION OF TREASURY ACTIVITIES Bank NTB Syariah is optimizing idlle liquidity that is not absorbed by financing and has met the operational needs of the Bank, by trying to diversify safe investments in placement of funds on the interbank money market, purchasing securities issued by the government and transactions at Bank Indonesia. In general, the investment of Bank NTB Syariah in 2020 grew 70.54% or to IDR3,197,601 million from IDR1,875,000 million from the previous period. 1. Interbank Mudharabah Investment Certificate) transactions Bank NTB Syariah conducts Islamic Interbank Money Market (PUAS) transactions through SIMA transactions issued by Sharia Commercial Banks and Sharia Business Units that require liquidity. The bank determines the purchase of SIMA with due regard to favorable returns. In 2020, the Bank recorded placement transactions with other banks with SIMA underlaying decreased by 54.50% or Rp.109 billion from the previous period. This is due to the fact that the liquidity position of Sharia Commercial Banks and Sharia Business Units is sufficiently protected from government assistance or stimulus in the national economic recovery during the Covid-19 pandemic. 2. Interbank Mudharabah Deposits Placement; The investment instrument for Bank NTB Syariah in the form of deposit transactions between Sharia Banks in 2020 is enough to increase the enthusiasm for investment with attractive returns from transactions from the purchase of SIMA. It is recorded that the Bank has made a placement of IDR200 billion in Islamic Commercial Banks and Sharia Business Units or grew 100% from the previous period. 3. Placement in State Sharia Securities (SBSN) Investments in securities are becoming popular nowadays especially in the midst of the Covid 19 conditions, the large number of government stimuli so that the absorption of National Economic Recovery funds is absorbed by the public so that BI 7 Days RR continues to decline in 2020. So that the price of State Sharia securities has yields increasing sharply and Bank NTB Syariah responded and invested IDR275 billion or grew 22.22% from the previous period. The investment portfolio of securities owned by Bank NTB Syariah aims to manage liquidity mismatches and optimize income from interest income. 4. Placements with Bank Indonesia The placement instrument at Bank Indonesia is the last investment instrument in optimizing revenue, in addition to supporting the liquidity mismatch. Generally, these transactions are SBIS, Sukuk BI and Fasbis with short-term tenors and are liquid in nature. Throughout 2020, investment in Bank Indonesia grew 81.49% or IDR1,181,601 million from the previous period. PT Bank NTB Syariah. 2020 Annual Report 164
  166. M a n a g e m e n t An a l y s i s a n d D I c u s s i o n o f t h e B a n k Pe r f o r m a n c e (in million rupiah) Nominal Investment Instrument SIMA Interbank Deposit SBSN Bank Indonesia - SBIS - SUKUK BI - FASBIS Total Growth 2019 2020 Nominal % 91,000 200,000 (109,000) -54.50% 200,000 - 200,000 100.00& 275,000 225,000 50,000 22.22% 2,631,601 1,450,000 1,181,601 81.49% 382,359 200,000 182,359 91.18% 1,999,242 900,000 1,099,242 122.14% 250,000 350,000 (100,000) -28.57% 3,197,601 1,875,000 1,322,601 70.54% Graph of Treasury activity (in million Rupiah) SIMA SBIS (SDBI) 382,359 91,000 200,000 200,000 2020 2019 SUKUK BI SBSN 275,000 1,999,242 225,000 900,000 BUSINESS PERFORMANCE RELATED TO INCREASE/DECREASE IN OPERATING INCOME In 2020, Bank NTB Syariah managed to maintain business performance and growth despite being in challenging conditions during the Covid-19 pandemic. Entering the second post-conversion year, the Bank continues to improve its Sharia-based operational performance. This is realized through the Bank's policies and strategic steps based on the latest conditions of economic opportunities and challenges in line with the expectations of shareholders and regulators. As seen in the plan and realization of the Bank's operational performance which has been achieved well. Bank NTB Syariah Operating Income comes from Bank Fund Management which comes from revenue from Receivables, Revenue Sharing, Rental Income and other main business income which consists of treasury activities both placements with Bank Indonesia, placements with other banks and placements in Securities. Income from Fund Management of Bank NTB Syariah is illustrated in the table below: Table of Income from Fund Management (in million rupiah) Growth Description 2020 2019 Nominal % Revenue from Receivables 303,916 456,583 (152,667) -33.44% Revenue Sharing 355,875 150,626 205,249 136.26% Ijarah Revenue 113 36 77 216.62% Other Main Operating Revenues 147,620 137,769 9,851 7.15% Fund Management Income 807,524 745,014 62,510 8.39% Graph of Income from Fund Management (in million Rupiah) Revenue from Receivables Revenue Sharing Ijarah Revenue 303.916 355.875 113 147.620 456.583 150.626 36 137.769 2019 165 Other main Operating Revenues PT Bank NTB Syariah. 2020 Annual Report 2020 Spirit of Amanah, Optimistic and Growth in Sustainable Business
  167. In 2020 , Revenues from Bank NTB Syariah fund management increased by 8.39% to IDR807,524 million compared to 2019 which amounted to IDR745,014 million. As the Bank's response to the national economic stimulus as a countercyclical policy on the impact of the spread of covid disease 2020 Number 11/POJK.03/2020 Year 2020, Bank NTB Syariah took a policy to adjust financing distribution pricing to maintain market share and restructure financing for customers affected by Covid -19. In addition, the source of income for Bank NTB Syariah also comes from other operating income including commission / fees / fees and administration, recovery of allowance for impairment losses, and write-off income. The following other operating income obtained by Bank NTB Syariah is illustrated in the table below: Tabel Pendapatan Operasional Lainnya (in million rupiah) Growth Description 2019 2020 Commission/Provision/Fee Income Nominal % 43,341 43,158 183 0.42% 75,368 173,878 (98,510) -56.65% 3,267 4,460 (1,193) -26.75% 121,976 221,496 (99,520) -44.93% and Administration Reversal of Allowance for Impairment of Earning Assets Other Operating Incomes Total Operating Income Graph of Other Operating Incomes (in million Rupiah) Commission/Provision/Fee Income and Administration Reversal of Allowance for Impairment of Earning Assets Other Operating Incomes 43,341 75,368 3,267 43,158 173,878 4,460 2019 Spirit of Amanah, Optimistic and Growth in Sustainable Business 2020 PT Bank NTB Syariah. 2020 Annual Report 166
  168. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank FINANCIAL PERFORMANCE REVIEW The financial review described below refers to the Financial Statements as of December 31, 2020 and the Financial Statements as of December 31, 2019 which are presented in this Annual Report. FINANCIAL PERFORMANCE FINANCIAL POSITION REPORTS The Financial Report has been audited by KAP BDO Tanubrata Sutanto Fahmi Bambang and Partners and received a fair opinion without modification of the financial position of Bank NTB Syariah for the period from January 1 to December 31, 2020 and received a fair opinion on the financial position of Bank NTB Syariah for the period from January 1 to as of December 31, 2019, as well as financial performance and cash flow for the year ended on that date, in accordance with Financial Accounting Standards and Sharia Financial Accounting Standards in Indonesia. The following is the realization of the Bank's financial position for 2020 compared to the previous year: (in million rupiah) Nominal Description 2020 Growth 2019 Nominal % ASSET Cash Giro and Placements at Bank Indonesia Placements at Other Bank 256,245 446,411 (190,166) -42.60% 1,010,775 1,141,962 (131,187) -11.49% 200,236 37 200,199 543872.43% 2,365,242 1,325,000 1,040,242 78.51% - - - - Receivables 2,182,373 2,716,611 (534,238) -19.67% - Murabahah Receivables Securities Owned Reverse Repo 2,171,558 2,716,611 (545,053) -20.06% - Istishna’ Receivables - - - - - Sewa Receivables - - - - - Qard Receivables 10,814 - 10,814 100.00% 4,228,054 2,864,765 1,363,289 47.59% - - - - 4,228,054 2,864,765 1,363,289 47.59% (43,906) (50,963) 7,057 -13.82% -36.69% Financing Revenue - Mudharabah - Musyarakah Allowance for Impairment Losses Ijarah Financing 457 722 (265) Participation 2,372 2,202 170 7.70% Intangible Assets - Book Value 1,409 1,892 (483) -25.51% 122,273 110,022 12,251 11.14% Fixed Assets and Investment - Book Value Other Assets 94,229 81,644 12,585 15.41% Total Assets 10,419,759 8,640,305 1,779,454 20.59% - - - - LIABILITIES, TEMPORARY SHIRKAH FUNDS, AND EQUITY Liabilities and Temporary Syirkah Funds Wadiah Saving Funds - Non Bank Wadiah Giro Wadiah Savings Temporary Syirkah Funds - Non Bank Mudharabah Giro 167 PT Bank NTB Syariah. 2020 Annual Report 147,973 142,853 5,120 3.58% 72,222 74,160 (1,938) -2.61% 10.27% 75,751 68,693 7,058 7,260,944 6,673,506 587,438 8.80% 518,209 688,032 (169,823) -24.68% Spirit of Amanah, Optimistic and Growth in Sustainable Business
  169. Nominal Description 2020 Growth 2019 Nominal % Mudharabah Savings 2.115.527 2.472.348 (356.821) -14,43% Deposit 4.627.208 3.513.126 1.114.082 31,71% - - - - 83.302 93.605 (10.303) -11,01% - - - - 1.346.161 164.746 1.181.415 717,11% 184.287 165.237 19.050 11,53% 9.022.667 7.239.946 1.782.721 24,62% - - 774.900 757.650 17.250 2,28% 542 542 - - Bank Indonesia Liabilities Other Bank Liabilities Securities Issued Financing Accepter Other Liabilities Total Liabilities and Temporer Syirkah Funds EQUITY Paid in Capital Donated Capital Capital Deposit Funds 1.000 17.250 (16.250) -94,20% (75.574) (61.293) (14.281) 23,30% 20 20 - - Retained Earnings 696.203 686.190 10.013 1,46% - Its Usage Has Been Determined 566.037 522.940 43.097 8,24% - Its Usage Has Not Been Determined Yet 130.166 163.249 (33.083) -20,27% 1.397.091 1.400.359 (3.268) -0,23% 10.419.759 8.640.305 1.779.453 20,59% Gain (loss) Actuarial Defined Benefit Program Other Additional Paid in Capital Total Equity TOTAL LIABILITIES, TEMPORARY SYIRKAH FUNDS, AND EQUITY Source: Bank NTB Syariah Financial Reports Graph of Financial Position Report (in million rupiah) 10,419,759 8,640,305 7,260,943 6,673,506 1,761,724 1,400,359 1,397,091 566,440 2019 2020 Asset 2019 2020 Liabilities Spirit of Amanah, Optimistic and Growth in Sustainable Business 2019 2020 Temporer Syirkah Funds 2019 2020 Ekuitas PT Bank NTB Syariah. 2020 Annual Report 168
  170. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank ASSET In 2020 , Bank NTB Syariah succeeded in increasing the growth of its assets. This is reflected in the increase in total assets of Bank NTB Syariah at the end of 2020 of IDR1,779,454 million or an increase of 20.59% (YoY) to IDR10,419,758 million compared to the previous year of IDR 8,640,305 million. The increase in the number of assets in 2020 was due to an increase in investment in securities and financing. (in million rupiah) Description 2020 Growth 2019 Nominal % Asset Cash Giro and Placements at Bank Indonesia 256,245 446,411 (190,166) 1,010,775 1,141,962 (131,187) -11.49% 236 37 199 541.81% - Giro at other Bank - - - - 236 37 199 541.81% 200,000 - 200,000 100.00% (2,000) - (2,000) 100.00% 100.00% - Less: Reserved Losses Decrease in Value Giro with Other Banks - Placement at Other Bank -42.60% - Less: Reserved Losses Decrease in Value 198,000 - 198,000 Securities Owned 2,365,242 1,325,000 1,040,242 78.51% - Murabahah receivables 2,171,558 2,716,611 (545,052) -20.06% (19,460) (32,288) 12,828 -39.73% Murabahah Receivables 2,152,098 2,684,322 (532,224) -19.83% - Musyarakah Financing 4,228,054 2,864,765 1,363,289 47.59% (22,446) (18,675) (3,771) 20.19% 4,205,608 2,846,090 1,359,518 47.77% 10,814 - 10,814 100.00% 2,372 2,202 170 7.70% 457 722 (265) -36.69% 3,861 3,861 - 0.00% (2,451) (1,969) (483) 24.51% 1,409 1,892 (483) -25.51% Placement at Other Bank - Less: Reserved Losses Decrease in Value - Less: Reserved Losses Decrease in Value Musyarakah Financing Qard Receivables Share participation Assets Acquired for Ijarah - Assets not Tangible - Amortization Accumulation Assets Not Intangible - Fixed Assets 173,538 151,994 21,545 14.17% - Accumulated Depreciation (51,265) (41,971) (9,294) 22.14% Fixed Assets 122,273 110,022 12,251 11.13% - 8,142 (8,142) -100.00% Assets Tax Deferred 15,959 16,077 (118) -0.73% Other Assets 78,270 57,425 20,844 36.30% Total Assets 10,419,758 8,640,305 1,779,454 20.59% Taxes Paid Upfront Graph of Assets (in million rupiah) 6,410,884 2,365,242 5,582,097 122,273 1,325,000 110,022 2019 2020 Securities Owned 169 PT Bank NTB Syariah. 2020 Annual Report 2019 2020 Loans Given 2019 2020 FIxed Asset Spirit of Amanah, Optimistic and Growth in Sustainable Business
  171. CASH Bank NTB Syariah cash includes petty cash , large cash and cash in Automated Teller Machines (ATMs) which are not restricted in use and are not used as collateral. Bank NTB Syariah cash in 2020 decreased by IDR190,166 million, to IDR256,245 million from IDR446,411 million in the previous year, or decreased by 42.60%. This decrease was caused by the Bank's operating and service activities during 2020. The following is a breakdown of cash for 2020 compared to the previous year: (in million rupiah) Description Cash in Bank Cash on ATM Machines 2020 Nominal % 199,067 392,327 (193,260) -49.26% 57,163 54,069 3,094 5.72% Petty Cash Total Growth 2019 15 15 - - 256,245 446,411 (190,166) -42.60% GIROS AND PLACEMENTS AT BANK INDONESIA Current accounts and placements with Bank Indonesia in 2020 amounted to IDR1,010,775 million, a decrease of 11.49% or IDR131,187 million from the previous year amounting to IDR1,141,962 million which was influenced by a decrease in value in the placement of Bank Indonesia Current Accounts by 36.07% or IDR213,546 million to IDR378,416 million compared to the previous year amounting to IDR591,962 million. The decrease in Placements with Bank Indonesia was due to a decrease in the Bank Indonesia Deposit Facility by 28.57% or IDR100,000 million. The following is a breakdown of current accounts and placements with Bank Indonesia for 2020 compared to the previous year: (in million rupiah) Description 2020 Growth 2019 Nominal % Bank Indonesia Giro 378,416 591,962 (213,546) -36.07% Placements at Bank Indonesia: 632,359 550,000 82,359 14.97% - BI Syariah Deposit Facility 250,000 350,000 (100,000) -28.57% - BI Syariah Certificate 382,359 200,000 182,359 91.18% 1,010,775 1,141,962 (131,187) -11.49% Total GIROS AT OTHER BANKS Current accounts with other banks in 2020 consist of current accounts with PT Bank BRI Syariah amounting to Rp. 200 million, Current accounts with PT Bank Mandiri (Persero) Tbk amounting to IDR35 million and Current accounts with PT Bank Syariah Mandiri amounting to IDR1 million. Current accounts with BRI Syariah are guarantee funds for Switching LINK services, current accounts with Bank Mandiri Syariah and Bank Mandiri are the transfer of collateral fees with PT Artajasa and current accounts of PT Bank Mandiri Syariah are placement of wadiah demand deposits using Sharia Principles. The following is the realization of current accounts with other banks for the 2020 period compared to the previous year: (in million rupiah) Description 2020 Growth 2019 Nominal % Giro at Other Bank - PT Bank BRI Syariah - PT Bank Syariah Mandiri - PT Bank Mandiri (Persero) Tbk Total 200 - 200 100.00% 36 1 35 3919.10% 1 36 (35) -98.66% 236 37 199 541.81% PLACEMENTS AT OTHER BANKS Placements with other banks conducted by Bank NTB Syariah are placements with other banks which represent placements in the form of mudharabah deposits. Mudharabah deposits are placed in PT Bank Mega Syariah. Placements with Other Banks in 2020 amounting to IDR200,000 million. The following are details of placements with other banks for the 2020 period compared to the previous year: Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 170
  172. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank (in million rupiah) Description 2020 Growth 2019 Nominal % Mudharabah Deposits: - PT Bank Mega Syariah 200,000 - 200,000 100.00% Total 200,000 - 200,000 100.00% SECURITIES Bank NTB Syariah securities in 2020 amounted to IDR2,365,242 million, an increase of IDR1,040,242 million or 78.51% from the previous year of IDR1,325,000 million. This increase was dominated by an increase in investment in Bank Indonesia Sukuk amounting to Rp1,099,242 million. The following is a breakdown of securities for the period 2020 compared to the previous year: (in million rupiah) Description Bank Indonesia Sukuk Held to fall due Bond Sharia (Letter of Treasury 2020 2019 Growth Nominal % 1,999,242 900,000 1,099,242 122.14% 275,000 225,000 50,000 22.22% 91,000 200,000 (109,000) -54.50% 2,365,242 1,325,000 1,040,242 78.51% State Sharia (SPNS)) Letter Securities Sharia (Interbank Mudharabah Investment Certificate (SIMA)) Total MURABAHAH RECEIVABLES Murabahah receivables in 2020 reached IDR 2,152,098 million or decreased by 19.83% compared to 2019 amounting to IDR 2,684,323 million. The following is the realization of murabahah receivables for the period 2020 compared to the previous year: (in million rupiah) Description - Murabahah receivables - Less: Reserved Losses Decrease in Value Murabahah Receivables 2020 2019 2.171.558 2.716.611 Growth Nominal (545.053) % -20.06% (19.460) (32.288) 12.828 -39.73% 2.152.098 2.684.322 (532.225) -19.83% MUSYARAKAH RECEIVABLES Musyarakah receivables in 2020 reached IDR 4,205,608 million or an increase of 47.77% or IDR 1,359,518 million compared to 2019 amounting to IDR 2,846,090 million. The following is the realization of musyarakah receivables for the period 2020 compared to the previous year: (in million rupiah) Description - Musyarakah Receivables - Less: Reserved Losses Decrease in Value Musyarakah Receivables 2020 2019 Growth Nominal % 4,228,054 2,864,765 1,363,289 (22,446) (18,675) (3,771) 47.59% 20.19% 4,205,608 2,846,090 1,359,518 47.77% SHARE PARTICIPATION Investment in Bank NTB Syariah shares in 2020 amounted to Rp2,372 million or an increase of Rp170 million from the previous year of Rp2,202 million. This increase was due to the increase in related parties to 7.72%. The following is the realization of investment in shares for the 2020 period compared to the previous year: 171 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  173. (in million rupiah) Description 2020 Growth 2019 Nominal % Related Parties (PT Sarana NTB Ventura) 2,372 2,202 170 7.70% Share Participations 2,372 2,202 170 7.70% ASSETS ACQUIRED FOR IJARAH Assets obtained for Ijarah Bank NTB Syariah in 2020 amounted to IDR457 million, a decrease of 36.70% or IDR265 million from the previous year of IDR722 million with the following details: (in million rupiah) Description 2020 Ijarah Multijasa Assets Growth 2019 Nominal % 888 955 (67) -6.96% Accumulated Depreciation (431) (233) (198) 85.16% Assets Acquired for Ijarah 457 722 (265) -36.69% INTANGIBLE ASSETS Intangible assets at Bank NTB Syariah in 2020 amounted to IDR 1,410 million, decreased by IDR 482 million or 25.48% from the previous year. The following is the realization of intangible assets for the period 2020 compared to the previous year: (in million rupiah) Description Assets Intangible Accumulated Amortization Intangible Assets 2020 Growth 2019 Nominal % 3,861 3,861 - - (2,451) (1,969) (483) 24,51% 1,410 1,892 (482) -25,51% FIXED ASSETS Fixed assets of Bank NTB Syariah in 2020 amounted to IDR122,273 million, an increase of IDR12,250 million from the previous year of IDR110,023 million, or an increase of 32.72%. The following is the realization of fixed assets for the period 2020 compared to the previous year: (in million rupiah) Description 2020 Growth 2019 Nominal % Fixed Assets 173,538 151,994 21,545 Accumulated Depreciations (51,265) (41,971) (9,294) 14.17% 22.14% Assets Intangible 122,273 110,022 12,251 11.13% OTHER ASSETS Other assets of Bank NTB Syariah in 2020 amounted to IDR 78,271 million, an increase of 36.30% or IDR 20,846 million from 2019 amounting to IDR 57,425 million. Other assets, among others, consist of various things in progress, consisting of fees to be paid by the Bank, the compensation to be received is a murabahah margin income, etc. are receivables from ATM principals, ATM cash differences, and advances / advance. The following is a breakdown of other assets for the 2020 period compared to the previous year: (in million rupiah) Description 2020 Growth 2019 Nominal % Expenses Paid in Advance 31,844 13,277 18,567 139.84% Rewards received 12,249 16,444 (4,195) -25.51% Miscellaneous in progress 11,462 9,224 2,238 24.26% KPPB Special Rate 5,046 8,523 (3,477) -40.80% Supplies Office Equipment 3,354 2,233 1,121 50.20% 822 1,650 1,121 -50.18% - 11 (828) -100.00% Special rate for kereta pusaka Special rate for regional leaders Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 172
  174. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank (in million rupiah) Description 2020 Abandoned property neto 2019 Growth Nominal % - 1,514 (1,514) -100.00% Other 13,494 4,549 8,945 196.64% Total 78,270 57,425 20,845 36.30% LIABILITIES AND TEMPORARY SYIRKAH FUNDS In 2020, total liabilities of Rp1,679,648 million, an increase of 254.22%, or Rp 1,205,460 million compared to the previous year of Rp474,188 million. The increase was due to the increase in Wadiah demand deposits as a result of the success of the Company's low-cost fund increase strategy, loans received, employee benefits, and other liabilities increase. The following details the temporary liabilities and funds for the 2019 period compared to the previous year: (in million rupiah) Description 2020 2019 Growth Nominal % Liabilities and Temporary Syirkah Funds Liabilities Immediate Liability 44,417 38,454 5,963 15.51% 6,261 5,780 481 8.33% - Giro Wadiah 72,222 74,160 (1,938) -2.61% - Wadiah Savings 75,750 68,693 7,057 10.27% Undistributed Revenue Sharings Wadiah Savings: Obligations to Other Banks Accepted Loans Tax Debt Employee Benefit 1,225 1,352 (127) -9.39% 1,346,161 164,746 1,181,414 717.11% 9,875 13,381 (3,506) -26.20% 79,166 53,721 25,445 47.36% Other Liabilities 44,568 53,900 (9,332) -17.31% Total Liabilities 1,679,648 474,188 1,205,460 254.22% - Mudharabah Deposits 4,627,208 3,513,126 1,114,082 31.71% - Mudharabah Savings 2,115,527 2,472,348 (356,821) (14.43%) TEMPORARY Syirkah FUNDS Temporary syirkah from non-banks: - Mudharabah Giro 518,209 688,032 (168,823) (24.68%) 7,260,943 6,673,506 587,437 8.80% - Mudharabah Deposits 6,500 14,500 (8,000) (55.17%) - Mudharabah Savings 66,867 73,914 (7,046) (9.53%) 8,709 3,839 4,870 126.88% 82,076 92,252 (10,176) (11.03%) 7,343,019 6,765,758 577,261 8.53% Total Temporary Syirkah from the Bank - Mudharabah Giro Total Total Temporary Syirkah Funds Chart of Liabilities and Temporary Syirkah Funds (in million rupiah) Giro Savings 762,192 2019 2020 2,541,041 2019 2020 590,431 2,191,278 Deposit 3,531,126 2019 2020 173 4,627,208 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  175. IMMEDIATE LIABILITIES Immediate Liabilities in 2020 amounted to IDR44 ,417million, an increase of 15.51%, or IDR5,963 million from the previous year, IDR38,454 million. Immediate liabilities consist of the Transfer Shelter post, Another shelter post, the Joint ATM Principal Liability post, the Liability to Third Party post, the Liability post to the Treasury and State Treasury Office, the Fee Post to be Paid, and other posts. Following are the details of the immediate liabilities for the 2020 period compared to the previous year: (in million rupiah) Description 2020 Growth 2019 Nominal % Transfer Settlements 7.723 14.245 (6.522) -45,78% Other Settlements 2.779 7.572 (4.793) -63,30% Joint ATMs Principal Liabilities 15.505 6.736 8.770 130,19% Liability to Third Parties 134 6.252 (6.118) -97,86% Office of the Treasurer and Treasury 952 2.273 (1.321) -58,13% 81 23 59 254,72% Fees to be Paid Others 17.242 1.353 15.889 1174,24% Immediate Liabilities 44.417 38.454 5.963 15,51% UNDISTRIBUTED REVENUE SHARING It is a profit-sharing that has not been distributed by the Bank to shahibul maal for the profit share of the Bank's business results that has been finalized from the management of customer funds. Profit-Sharing was distributed in 2020 amounting to Rp262 million, an increase of 8.32%, or Rp482million from Rp5,780 million in the previous year. The following is revenue sharing which has not been distributed for the 2020 period compared to the previous year Nominal Description 2020 Undistributed Revenue Shares 2019 6.262 (in million rupiah) Growth Nominal 5.780 % 483 8,33% WADIAH SAVINGS Wadiah Savings Bank NTB Syariah in 2020 amounted to Rp147,973 million increased by 3.58% compared to the position of wadiah deposits in 2019 which reached Rp142,853 million. This increase was due to Wadiah demand deposits experienced an increase of 10.27% or as much as Rp7,057 million compared to the previous year of Rp.68,693 million. Meanwhile, for Wadiah Savings decreased 2.61% or as much as Rp1,938 million compared to the previous year of Rp74,160 million. The following details wadiah savings for the period 2020 compared to the previous year: (in million rupiah) Description Wadiah Giros 2020 Growth 2019 Nominal % 72.222 74.160 (1.938) -2,61% 23 8 16 195,95% - Third Party 72.199 74.152 (1.953) -2,63% Wadiah Savings 75.751 68.693 7.058 10,27% 15 7 8 127,02% - Related parties - Related parties - Third Party Total Spirit of Amanah, Optimistic and Growth in Sustainable Business 75.736 68.686 7.050 10,26% 147.973 142.853 5.120 3,58% PT Bank NTB Syariah. 2020 Annual Report 174
  176. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank OBLIGATIONS TO OTHER BANKS Obligations to Other Banks Bank NTB Syariah in 2020 amounted to Rp1 ,225 million, decreased 9.39%, or Rp127 million compared to the previous year which reached Rp1,352 million. Following is the realization of obligations to other banks for the 2020 period compared to the previous year: (in million rupiah) Description Obligation to other Banks 2020 1.225 Growth 2019 Rp 1.352 % (127) -9,39% LOAN RECIEVED Loans received by Bank NTB Syariah in 2020 amounted to Rp1,346,160 million, increased 717.11%,or Rp1,181,415 million compared to the previous year which reached Rp164,746 million. A significant increase in 2020 due to a new collaboration. Loans received from the Hajj Financial Management Agency amounting to Rp1,000,000 million, KPR Liquidity Facility for Housing Financing in 2020 increased by 140.96% or Rp182,903 million, PT Sarana Multigriya Finansial (Persero) decreased by 4.26% or IDR 1,489 million. Meanwhile, Government Bonds and LPDB KUMKM fell 100% because the collaboration at the end of 2019 had ended. The following is a breakdown of loans received for the 2020 period compared to the previous year: (in million rupiah) Description Hajj Financial Management Agency Mortgage Facility Liquidity Financing Housing PT Sarana Multigriya Financial (Persero) Total 2020 Growth 2019 Rp % 1.000.000 - 1.000.000 100,00% 312.661 129.758 182.903 140,96% 33.499 34.988 (1.489) -4,26% 1.346.161 164.746 1.181.415 717,11% TEMPORARY SYIRKAH FUND Bank NTB Syariah Temporary Syirkah Funds in 2020 is Customer Deposits consisting of Mudharabah Deposits, Mudharabah Savings and Mudharabah Current Accounts. Mudharabah deposits in 2020 amounted to Rp4,633,707, an increase of 31.35% or Rp1,106,081 million from the previous year amounting to Rp3,527,626 million. Mudhrabah savings in 2020 amounted to IDR 2,182,394, a decrease of 14.29% or IDR 363,868 million from the previous year of Rp2,546,262 million. Meanwhile, Mudharabah Current Accounts in 2020 amounted to Rp.526,917, experiencing a decrease of 23.84% or Rp.164,954 million from the previous year amounting to Rp.691,871 million. The following is a breakdown of temporary Syirkah Funds for the 2019 period compared to the previous year: (in million rupiah) Description 2020 2019 Growth Rp % Mudharabah Deposits: 4.633.708 3.527.626 1.106.082 - Mudharabah Deposits - Non-Banks 4.627.208 3.513.126 1.114.082 31,71% 6.500 14.500 (8.000) -55,17% Mudharabah Savings: 2.182.394 2.546.262 (363.867) -14,29% - Mudharabah Savings - Non-Banks 2.115.257 2.472.348 (356.821) -14,43% - Mudharabah Deposits - Banks - Mudharabah Savings - Bank 31,35% 66.867 73.914 (7.046) -9,53% Mudharabah Giros: 526.918 691.871 (164.953) -23,84% - Mudharabah Giro - Non-Bank 518.209 688.032 (169.823) -24,68% 8.709 3.839 4.870 126,88% 7.343.019 6.765.758 577.261 8,53% - Mudharabah Giro - Bank Total Temporary Syirkah Funds 175 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  177. OTHER LIABILITIES Other liabilities - Other Bank NTB Syariah in 2020 amounted to IDR44 ,568 million, decreased 17.31% or IDR9,332 million from the previous year amounting to IDR53,900 million. The following is the realization of other liabilities for the 2020 period compared to the previous year (in million rupiah) Description Other Liabilities 2020 2019 44.568 53.900 Growth Nominal % (9.332) -17,31% EQUITIES Bank NTB Syariah's equity at the end of 2020 was IDR 1,397,091 million, a decrease of 0.23% from the previous position in 2019, which was IDR 1,400,359 million. The decrease was mainly due to a decrease in paid-in funds by 94.20% and a decrease in retained earnings by 20.27% or Rp.33,083 million from Rp163,249 million in the previous year. The following is a breakdown of equity for the period 2020 compared to the previous year: (in million rupiah) 2020 Description Paid in Capital Donated Capital Additional Paid in Capital Growth 2019 Rp % 774.900 757.650 17.250 2,28% 542 542 - - 1.000 17.250 (16.250) -94,20% (75.574) (61.293) (14.281) 23,30% 20 20 - - Retained Earnings 696.203 686.190 10.014 1,46% - Its Usage Has Been Determined 566.037 522.940 43.097 8,24% - Its Usage Not Yet Determined 130.166 163.249 (33.084) -20,27% 1.397.091 1.400.359 (3.267) -0,23% Gain (loss) Actuarial Defined Benefit Programs Supplementary Additional Paid-in Capital TOTAL EQUITIES Chart of Equity (in million rupiah) 1.400.359 1.397.091 2019 2020 Equities Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 176
  178. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank PAID-UP CAPITAL The paid-up capital of the shareholders was IDR 774 ,900 million, there was an additional paid-up capital of IDR 17,250 million or 2.28% as stated in the Deed of the Minutes of the Annual General Meeting of Shareholders of Bank NTB Syariah Deed No. made by Abdullah, SH. Notary in Mataram. The following is the realization of paid-in capital for the 2020 period compared to the previous year: (in million rupiah) Description Paid-up Capital Growth 2019 2020 774.900 Nominal 757.650 % 17.250 2,28% DONATED CAPITAL Other donated capital consists of land from the West Lombok Regional Government located on Gili Trawangan Island in 2009 and donations for banking facilities obtained from Bank Indonesia, in the form of a computer. Until the end of 2020, the recorded contribution capital was IDR 542 million. (in million rupiah) Description Donated Capital 2020 Growth 2019 542 Nominal 542 % - - CAPITAL DEPOSIT FUNDS Until the end of 2020, the amount of funds for paid up capital was IDR 1,000 million or decreased by 94.20% compared to the previous year's period of IDR 17,250 million. (in million rupiah) Description Additional Paid in Capital 2020 1.000 2019 17.250 Growth Nominal % (16.250) -94,20% RETAINED EARNINGS In accordance with the Regulation of the Financial Services Authority (OJK) No. 64 / POJK.03 / 2016 dated 27 December 2016 concerning Changes in Business Activities of Conventional Banks to become Sharia Banks, Banks must present the initial financial statements as a Sharia Bank. And in accordance with OJK Circular No. 2 / SEOJK.03 / 2017 dated 3 January 2017 concerning Changes in Business Activities of Conventional Commercial Banks to become Sharia Commercial Banks, Banks must present the initial financial report as a BUS which shows the current year's profit and loss and last year's profit and loss having a balance of IDR 0.00 (zero rupiah) or nil. For the Unspecified Retained Profit in 2020 amounting to Rp.696,203 million, an increase of 1.46% or Rp.10,014 million compared to the previous year with the following details: (in million rupiah) Description 2020 2019 Growth Nominal % Retained Earnings - Its Usage Has Been Determined 566.037 522.940 43.097 8,24% - Its Usage Not Yet Determined 130.166 163.249 (33.083) -20,27% Total 696.203 686.190 10.014 1,46% 177 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  179. INCOME STATEMENTS AND OTHER COMPREHENSIVE INCOME The financial performance of Bank NTB Syariah in 2020 shows a net profit (profit after tax) of IDR 130,166 million or a decrease of 20.27% from the previous year's profit of IDR 163,249 million. Meanwhile, the Comprehensive Profit for the Year 2020 amounted to IDR115,885 million or decreased by 24.45% or IDR 37,514 million from the previous year of IDR 153,398 million. The following are statements of profit or loss and other comprehensive income for 2020 compared to 2019: (in million rupiah) Description Fund Management Income Growth 2019 2020 Nominal % 807.524 745.014 62.510 8,39% (374.013) (302.064) (71.950) 23,82% Bank’s Share in Profit Sharing 433.511 442.950 9.439 -2,13% Other Operating Income 121.976 221.496 (99.520) -44,93% (382.108) (440.069) 57.961 -13,17% 173.378 224.377 (50.998) -22,73% 2.787 (1) 2.788 409939,71% Income Before Income Tax 176.165 224.376 (46.211) -21,49% Income Tax Expense (46.000) (61.126) 15.127 -24,75% Profit After Tax 130.166 163.249 (33.084) -20,27% Other Comprehensive Income (14.281) (9.851) (4.430) 44,96% 115.885 153.398 (37.513) -24,45% Fund Expenses Operating Expenses Operating Profit Non-Operational Income and Expenses (expenses) Current Comprehensive Income Graph of Income Statement (in million rupiah) Profit After Tax 163.249 2019 130.166 2020 FUND MANAGEMENT REVENUES The cost of funds in 2020 amounted to IDR 374,013 million, an increase of 15.68% or IDR 71,949 million compared to 2019 of IDR302,064 million. The increase was due to an increase in mudharabah deposit funds. The following is a breakdown of the cost of funds for the 2019 period compared to the previous year: (in million rupiah) Description 2020 Growth 2019 Nominal % Revenue from Receivables 303.916 456.583 (152.667) -33,44% Profit Sharing Income 355.875 150.626 205.249 136,26% 113 36 77 216,62% Other Main Operating Revenues 147.620 137.769 9.850 7,15% Fund Management Income 807.524 745.014 62.510 8,39% Rental Income - Net Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 178
  180. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank COSTS OF FUNDS The cost of funds in 2020 amounted to IDR374 ,013 million, an increase of 23.82% or IDR71,949 million compared to 2019 of IDR302,064 million. The increase was due to an increase in mudharabah deposit funds. The following is a breakdown of the cost of funds for the 2019 period compared to the previous year: (in million rupiah) Description 2020 2019 Growth Nominal % Expenses for Results 346.581 297.267 49.314 16,59% - Mudharabah Giros 38.868 50.594 (11.725) -23,18% - Mudharabah Savings 26.211 39.725 (13.514) -34,02% - Mudharabah Deposits 281.501 206.948 74.553 36,02% 27.433 4.797 22.636 471,91% 374.013 302.064 71.949 23,82% Others Cost of Funds BANK’S SHARE IN PROFIT SHARING The Bank’s Share in Profit Sharing in 2020 amounted to IDR433.511million, a decrease of 2.13% or IDR9.439million compared to 2019 amounting to IDR442,950 million. The following are the realizations for the 2019 period compared to the previous year: (in million rupiah) Description Bank’s Share in Profit Sharing 2020 433.511 2019 442.950 Growth Nominal (9.439) % -2,13% OTHER OPERATING REVENUES Other Operating Revenues of the Bank in 2020 amounted to IDR121,976 million, a decrease of 44.93% or IDR99.520 million compared to 2019 of IDR21,496 million. The following is a breakdown of other operating income for the period 2020 compared to the previous year: (in million rupiah) Description Revenue Commission/Fees/Fee and 2020 2019 Growth Nominal % 43.341 43.158 185 0,42% 75.368 173.878 (98.510) -56,65% Administration Reversal of Reserves Losses Decrease in Value of Assets Earning Other Operational Revenues Total Operating Incomes 3.267 4.460 (1.193) -26,75% 121.976 221.496 (99.520) -44,93% OPERATING EXPENSES Operating expenses in 2020amounted to IDR382.108 million, an decreased of 13,17% or IDR57.961 million compared to 2019 of IDR440,069 million. The following details operational expenses for the 2020 period compared to the previous year: (in million rupiah) Description 2020 2019 Growth Nominal % Salaries and Allowances General 155.486 140.778 14.707 and Administrative Expenses 155.256 133.636 21.620 10,45% 16,18% Formation of Reserves Losses 71.367 165.655 (94.289) -55,92% 382.108 440.069 (57.961) -13,17% Decrease in Value of Assets Finance Productive Total Operating Expenses 179 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  181. INCOME BEFORE TAX Pro fit before tax in 2020 amounted to IDR176,166 million, a decrease of 21.49% or IDR48,211 million compared to 2019 which amounted to IDR176,165 million. The following is the realization of profit before income tax for the period 2020 compared to the previous year: (in million rupiah) Description Income before Tax Growth 2019 2020 176.166 Nominal 224.376 % (48.211) -21,49% INCOME AFTER TAX Profit after income tax in 2020 amounted to IDR130,166 million, decreased by 20.27% or IDR33,083 million compared to 2019 of IDR163,249 million. The decrease in net profit was due to income from other operations which decreased significantly compared to income from Fund management. The following is the realization of profit after income tax for the period 2020 compared to the previous year: (in million rupiah) Description Income After Tax Growth 2019 2020 130.166 Nominal 163.249 % (33.084) -20,27% CASH FLOW STATEMENTS Bank NTB Syariah establishes a policy in cash flow management to optimize cash inflows and outflows. Bank NTB Syariah's 2020 cash flow statement is prepared using the direct method by classifying cash flows into operating, investing and financing activities as follows: (in million rupiah) Description 2020 2019 Growth Nominal % Cash and Cash Equivalents at the Beginning of the Year 1.588.410 1.721.785 (133.375) -7.75% Cash Flow from Operating Activities (100.484) (128.141) 27.658 -21.58% Cash Flow from Investment Activities (21.670) (22.484) 814 -3.62% -94.20% Cash Flows from Funding Activities 1.000 17.250 (16.250) Net Increase (Decrease) of Cash and Cash Equivalents (121.154) (133.375) 12.221 -9.16% Cash and Cash Equivalents at the End of the Year 1.467.256 1.588.410 (121.154) -7.63% Graph of Cash Flow Statement (in million rupiah) 17.250 Cash Flow from Operating Activities Cash Flow from Investment Activities 1.000 2020 2019 Cash Flows from Funding Activities (100.484) (128.141) Spirit of Amanah, Optimistic and Growth in Sustainable Business (21.670) (22.484) PT Bank NTB Syariah. 2020 Annual Report 180
  182. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank As of December 31 , 2020, Bank NTB Syariah experienced a decrease in Cash and Cash Equivalents by 7.63% to IDR1,467,256 million from 2019 amounting to IDR1,588,410 million. However, this decline still indicates an adequate level of Bank liquidity to support business activities. CASH FLOW FROM OPERATING ACTIVITIES The position of net cash flows obtained from operating activities as of December 31, 2020 was IDR100,484, decreased by 3.62% or IDR27,657 million compared to 2019 which was IDR128,141 million. This was due to changes in assets and liabilities used for operations, mainly used for financing musyarakah and murabahah receivables NET CASH FLOW FROM INVESTMENT ACTIVITIES Net cash used in investing activities in 2020 amounted to IDR21,670 million, a decrease of 3.62% or IDR814 million compared to 2019 of IDR22,484 million. This decrease was due to a decrease in the use of cash to acquire fixed assets of banks in 2020. NET CASH FLOW FROM FINANCING ACTIVITIES Net cash used for funding activities in 2020 was IDR1,000 million, decreased by 94.20% or IDR16,250 million compared to 2019 of IDR17,250 million. This decrease was due to a decrease in paid-up capital from shareholders in 2020. COMMITMENT AND CONTINGENCY REPORTS Commitments and Contingencies are administrative accounts arising from financing transactions. Commitment refers to the commitment to provide financing and financial instruments that result in the recognition of assets and / or liabilities during a certain period. Contingencies are the probability of assets and / or liabilities that may occur as a result of several events related to financing and acceptance transactions at the Bank. Bank NTB Syariah is committed to providing financing facilities to customers and contingencies, in the form of income on settlement and bank guarantees received. The Bank's commitment and contingent liabilities in 2020 amounted to negative IDR33,328 million from IDR35,824 million in the previous year. The following is a report on commitments and contingencies for 2020. (in million rupiah) Description 2020 Growth 2019 Nominal % Commitment Bills Financing facilities that have not been withdrawn - - - - (372.078) (171.121) (200,957) 117,44% - - 268 393 (126) -31,98% 14.506 13.338 1,168 8,76% 6.690 6.198 492 7,94% - - (46.864) (16.588) (30,276) 182,52% - - 135.973 134.451 1.522 1,13% (261.504) (33.329) (228.178) 684,63% Commitment Obligations Financing Facilities that have not been withdrawn Contingencies Received Guarantee Margin income and revenue sharing On progress Revenue Contingent Obligations Given Guarantee Others Written-off Financing Commitment Liabilities and Net Contingent 181 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  183. PROFIT SHARING DISTRIBUTION REPORTS (in million rupiah) Average Balance Porsi Pemilik Dana Income to be shared Type of Fund Raising A B Liabilities to Other Banks Ratio (%) Total Profit sharing Indication of Rate of Return (%) C D E 88.729 369 20,60% 76 1,03% Mudharabah Giro 1.042.832 4.459 31,76% 1.416 1,63% Mudharabah Savings 2.012.869 8.606 18,03% 1.552 0,93% Mudharabah Deposits - 1 month 546.478 2.336 54,28% 1.268 2,78% - 3 months 1.296.601 5.544 50,38% 2.793 2,58% - 6 months 1.184.078 5.0639 49,81% 2.522 2,56% - 12 months 1.702.383 7.279 54,11% 3.939 2,78% - - - - 451.613 10.386 30,26% 8.325.583 44.042 Securities issued Financing Received Total Type of Fund Distribution A B 202.251 - Securities owned 2.094.955 175 Murabahah Receivables 2.191.954 22.093 Istishna Accounts Receivable - - 479 6 Pawn Financing - - Mudharabah Financing - - 4.141.080 37.779 - - Multi-Service Accounts Receivable Musyarakah Financing Lease Financing Other Financing Total 754 - 8.631.473 60.053 Spirit of Amanah, Optimistic and Growth in Sustainable Business 8,35% Income Received Average Balance Placements with Other Bank 3,143 16,709 PT Bank NTB Syariah. 2020 Annual Report 182
  184. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank PRODUCTIVE ASSET QUALITY ANALYSIS No Pos- Pos December 31 , 2020 L I RELATED PARTIES 1. Placements with other banks 2. 3. DPK KL D M Total a. Rupiah - - - - - - b. Foreign Exchange - - - - - - a. Rupiah - - - - - - b. Foreign Exchange - - - - - - a. Rupiah - - - - - - b. Foreign Exchange - - - - - - - - - - - - 1. Rupiah - - - - - - 2. Foreign Exchange - - - - - - 58.318 - - - - 58.318 - - - - - - 1. Rupiah - - - - - - 2. Foreign Exchange - - - - - - Profit sharing financing - - - - - - - - - - - - 1. Rupiah - - - - - - 2. Foreign Exchange - - - - - - - - - - - - 7.003 - - - - 7.003 - - - - - - - - - - - - 1. Rupiah - - - - - - 2. Foreign Exchange - - - - - - Spot and Derivative Receivables Securities Owned 4. Acceptance Charges 5. Accounts receivable and lease based financing a. Micro, Small and Medium Enterprise (UMKM) b. Not UMKM customers 1. Rupiah 2. Foreign Exchange c. Restructured financing 6. a. Micro, Small and Medium Enterprise (UMKM) b. Not UMKM customers 1. Rupiah 2. Foreign Exchange c. Restructured financing 7. Temporary stock participation - - - - - - 8. Commitments and contingencies - - - - - - a. Rupiah - - - - - - b. Foreign Exchange - - - - - - 183 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  185. (in million rupiah) PRODUCTIVE ASSET QUALITY REPORT AND OTHER INFORMATION Reporting dates Dec 31, 2020 and Dec 31, 2019 Productive Asset Quality and Other Information December 31, 2019 L DPK KL D M Total - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 4.057 - - - - 4.057 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 1.176 - - - - 1.176 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 184
  186. An a l i s i s d a n Pe mb a h a s a n Manajemen atas Kinerja Bank No Pos- Pos December 31 , 2020 L II NON-RELATED PARTIES 1. Placements with other banks a. Rupiah b. Foreign Exchange 2. 3. Spot and Derivative Receivables DPK KL D M Total 200.236 - - - - 200.236 - - - - - - - - - - - - a. Rupiah - - - - - - b. Foreign Exchange - - - - - - - - - - - - 2.365.242 - - - - 2.365.242 - - - - - - Securities Owned a. Rupiah b. Foreign Exchange 4. Acceptance Charges - - - - - - 5. Accounts receivable and lease based financing - - - - - - - - - - - - 110.332 4.989 487 817 20.442 137.067 - - - - - - a. Micro, Small and Medium Enterprise (UMKM) 1. Rupiah 2. Foreign Exchange b. Not UMKM customers 1. Rupiah 2. Foreign Exchange c. Restructured financing 1. Rupiah 6. - - - - - - 1.948.630 11.981 1.400 794 24.640 1.987.445 - - - - - - - - - - - - 24.160 2.181 82 93 8 26.524 2. Foreign Exchange - - - - - - Profit sharing financing - - - - - - - - - - - - 300.489 7.382 1.110 1.343 26.881 337.205 - - - - - - - - - - - - 3.868.155 12.696 - 812 2.183 3.883.846 - - - - - - - - - - - - 143.990 10.811 881 734 1.097 157.513 a. Micro, Small and Medium Enterprise (UMKM) 1. Rupiah 2. Foreign Exchange b. Not UMKM customers 1. Rupiah 2. Foreign Exchange c. Restructured financing 1. Rupiah 2. Foreign Exchange 7. Temporary stock participation 8. Commitments and contingencies a. Rupiah b. Foreign Exchange III OTHER INFORMATIONS 1. Total pledged Bank assets - - - - - - 2.372 - - - - 2.372 - - - - - - 418.942 - - - - 418.942 - - - - - - a. At Bank Indonesia b. Other Parties 2. Foreclosed collateral 185 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  187. PRODUCTIVE ASSET QUALITY REPORT AND OTHER INFORMATION Reporting dates Dec 31 , 2020 and Dec 31, 2019 Productive Asset Quality and Other Information December 31, 2019 L DPK KL D M Total 37 - - - - 37 - - - - - - - - - - - - - - - - - - - - - - - - - - - - 1.325.000 - - - - 1.325.000 - - - - - - - - - - - - - - - - - - - - - - - - 142.813 3.229 1.086 882 21,470 169.480 - - - - - - - - - - - - 2.694.435 11.552 2.486 3.276 22.368 2.734.117 - - - - - - - - - - - - 1.242 - - - - 1.242 - - - - - - - - - - - - - - - - - - 222.154 4.021 1.995 877 20.257 249.304 - - - - - - - - - - - - 2.646.249 3.069 783 - 1.841 2.651.942 - - - - - - - - - - - - 11.863 - 980 154 - 12.997 - - - - - - 2.202 - - - - 2.202 - - - - - - 187.709 - - - - 187.709 - - - - - - Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 186
  188. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e SOURCES AND DISTRIBUTIONS OF ZAKAT FUNDS REPORTS The sources of zakat , infaq, and shadaqah funds distributed by Bank NTB Syariah come from banks and other parties which are managed based on Sharia principles. In managing the Bank's zakat funds, the bank collaborates with the NTB National Zakat Agency (BAZNAS) to be distributed to mustahiq (zakat recipients). The following is a report on the sources and distribution of Bank NTB Syariah zakat funds in 2020: (in million rupiah) Description 2020 Source of zakat funds at the beginning of the year 2019 14 3 Source of zakat funds: - Zakat from the Bank - Zakat from The Outer Banks - - 791 462 Usage and Zakat Distributed to other institutions: - Others (756) (451) Increase in zakat funds 35 11 Source of zakat funds at the end of the year 49 14 SOURCES AND DISTRIBUTION OF BENEVOLENT FUNDS REPORTS The report on the source and use of benevolent funds is a financial report that reflects the Bank's role as the holder of the trust for funds for social activities which is managed separately. The following is the report on the sources and use of the 2020 benevolence fund: (in million rupiah) Description 2020 2019 Sources of benevolent funds at the beginning of the period 1.413 1.348 Receipt of benevolent funds 1.759 2.171 a. Infa’ - 523 b. Shadaqah - - c. Returns of funds virtue productive - - d. Fine - 18 e. Non-halal Revenue - - f. Others 1.759 1.630 Use of benevolent funds: 1.623 2.106 a. Productive benevolent funds b. Donations c. Other uses for public use Increase (Decrease) of Benevolent Fund Sources Sources of benevolent funds at the end of the period 187 PT Bank NTB Syariah. 2020 Annual Report - - 466 2.058 1.157 48 136 65 1.549 1.413 Spirit of Amanah, Optimistic and Growth in Sustainable Business
  189. MAIN FINANCIAL RATIOS Rasio keuangan adalah alat yang digunakan untuk menganalisis kondisi keuangan dan kinerja perusahaan . Berdasarkan pencapaian kinerja ditahun 2020, maka didapatkan rasio-rasio keuangan penting Bank NTB Syariah pada akhir tahun sebagaimana tabel di bawah ini: (in %) Description Capital Adequecy Ratio (CAR) 2020 2019 31,60% 35,47% 0,82% 1,01% Non-performing Earning Assets to Total Earning Assets 0,84% 1,02% Allowance for Impairment Losses for Financial Assets to Earning Assets 0,46% 0,68% NPF/NPL Gross 1,26% 1,36% NPF/NPL Nett 0,77% 0,61% Return on Assets (ROA) 1,74% 2,56% Return on Equity (ROE) 9,54% 12,05% Net Interest Margin (NI)/NIM 4,38% 5,51% Net Operating Margin (NOM) 1,22% 2,18% Operating Expense to Operating Income (BOPO) 81,39% 76,83% Cost to Income Ratio (CIR) 64,23% 56,10% Revenue Sharing Financing to Total Financing 65,95% 51,32% Financing to Deposit Ratio (FDR)/LDR 86,53% 81,89% - Percentage of Violation of the LLL 0,00% 0,00% - Percentage of Exceeding LLL 0,00% 0,00% - Giro Mandatory Minimum (Giro Wajib Minimum (GWM)) (Rupiah) 4,13% 6,82% Non-performing Earning Assets and Non-performing Non-earning Assets to Total Earning Assets and Non-earning Assets Compliance Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 188
  190. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e DEBT PAYING ABILITY Based on the ratios mentioned above , it shows that the Bank has met the applicable regulations for capital ratios, earning assets, profitability, liquidity, and compliance. In general, the ratios that indicate the Bank's performance are as follows: 1. Liquidity Ratio The Liquidity Ratio is measured by a comparison between the amount of financing provided to the amount of customer deposits (FDR) to determine the Bank's ability to repay obligations to customers who have deposited their funds and the financing that has been given to debtors as a source of liquidity. The Bank's FDR ratio for the December 31, 2020 was 86.53%, while for the December 31, 2019 it was 81.89%. This ratio reflects the Bank's liquidity is still in good condition. 2. Solvency Ratio The solvency ratio describes the Bank's ability to meet long-term liabilities or capital capacity (CAR), which is one of the health indicators of the Bank's capital which shows how much the Bank's capital is sufficient to support its needs and as a basis for assessing the prospects for the Bank's business continuity. The Bank's CAR ratio for the position of December 31, 2020 was 31.60%, while for the position of December 31, 2019 it was 35.47%, this ratio reflects that the Bank's capital is still in a healthy condition. 3. Rentability Ratio Rentability ratio describes the level of profitability and business efficiency achieved by the Bank. Rentability ratio to describe the level of profitability is measured by the ratio of Return on Assets (ROA), Return on Equity (ROE) and Net Rewards (NI), while to describe the level of business efficiency is measured by the ratio of Operating Expenses to Operating Income (BOPO). The ROA and ROE ratios for the position of December 31, 2020 showed a fairly good performance, namely 1.74% and 9.54%. Meanwhile, the NI ratio was 4.38% and the OEOI ratio was 81.39%. CHANGES IN BOND INVESTMENT FUNDS Bound investment is an investment sourced from the owner of bound investment funds and the like which is managed by the Bank as an Investment Manager based on mudharabah muqayadah or as an investment agent. Binding investment is neither an asset nor a bank liability because the bank has no obligation to return or bear the investment risk. The bank receives a share of the profit or increase in the investment. The following is the report on changes in bound investment for the period 2020: (in million rupiah) Description Portofolio A Des 31, 2020 Portofolio B Des 31, 2019 Des 31, 2020 Total Des 31, 2019 Des 31, 2020 Des 31, 2019 1. Initial Period Information - - - - - - Initial Balance - - - - - - 2. Current Period Information: - - - - - - 3. End Period Information - - - - - - Final Balance - - - - - - a. Receipt of Funds b. Funds Withdrawal c. Investment profit (loss) d. Charges/Costs e. Bank fees/receipts 189 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  191. BACKUP OF PRODUCTIVE FINANCIAL ASSET VALUE REDUCTION As a form of prudence in carrying out company operations , Bank NTB Syariah has established an Allowance for Losses which contains Allowance for Impairment Losses (CKPN) and Compulsory Allowance for Earning Asset Losses (PPA). The following CKPN and PPA must be form at the end of 2020: (in million rupiah) December 31, 2020 Description CKPN December 31, 2019 PPA must be Formed Individual Collective General Placements with Other Banks - - 2.002 Spot and Derivative Bills - - - Securities owned - - Acceptance bills - - Murabahah receivables - Istisna Receivables CKPN PPA must be Formed Individual Collective - - - - - - - - - - - - - - - - - - - - - - 19.640 18.839 39.454 - 32.288 26.246 36.805 - - - - - - - - Qardhul Hasan Receivables - - - - - - - - Lease Receivables - - - - - - - - Mudharabah Financings - - - - - - - - Musyarakah Financings - 22.446 21.099 - 18.675 27.014 14.490 Other Financings - - 5 - - - 7 - Temporary Share Participation - - 24 - - - 22 - Commitment and Contingencies - - 469 - - - 166 - 39.735 Special General Special BANK FINANCING COLECTIBILITIES Financing risk is reflected in the ratio of non-performing financing to total financing or NPF which was recorded at 1.26% in 2020 or an improvement of 0.10% compared to the same period in the previous year of 1.36%. The Bank will continue to improve the quality of the financing system by applying the principle of prudence, to improve the quality of customer financing and mitigate the risk of a decline in the quality of financing. The following is the collectability of the Bank's receivables for the period 2020 compared to the previous year: (in million rupiah) Nominal Description Smoothly With Special Attention Less Current Doubted Bad Total NPF Gross Spirit of Amanah, Optimistic and Growth in Sustainable Business 2020 2019 Growth Nominal % 6.292.924 5.485.622 807.302 14,72% 37.049 20.530 16.520 80,47% 2.996 6.349 (3.353) -52,81% 3.767 4.957 (1.191) -24,02% 74.147 64.640 9.508 14,71% 6.410.884 5.582.097 828.786 14,85% 1,26% 1,36% -0,10% -7,24% PT Bank NTB Syariah. 2020 Annual Report 190
  192. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e Some of the steps taken in solving problematic financing include: 1. Monitoring administration and collectability both online and offline. 2. Billing to customers with a friendship approach; The bank has conducted direct collection against the write-off customers with a consolidated result of IDR6,6 billion and collectability 3, 4 and 5 customers of 41 billion. 3. Submission of NPF Customer claims to Partner Insurance; The Bank coordinates with the insurance party regarding financing claims and has made payments by the insurer for doubtful collectability and loss of IDR6.2 Billion; 4. Financing Restructuring Affected by Covid 19: The bank has carried out a restructuring analysis given to customers affected by the Covid-19 pandemic during 2020 in the form of instalment relaxation that can help customers to be able to maintain their business during the pandemic period. Until the end of 2020, relaxation had been carried out for 704 customers by providing a principal delay of IDR13,816 million and a delay in the margin / profit sharing of IDR681 Million. 5. Financing Restructuring (General) One of the efforts to save and resolve problematic financing is by providing financing restructuring in the form of instalment relaxation for current collection customers, deposits, substandard, doubtful and loss. CAPITAL STRUCTURES AND RISK MANAGEMENT PRACTICES CAPITAL STRUCTURES A strong capital structure is a very important aspect for financial institutions, especially banking, to support sustainable business growth. Therefore, Bank NTB Syariah always strives to ensure the level of capital adequacy is always above the provisions of the Financial Services Authority (OJK) regarding the Minimum Capital Adequacy Requirement (KPMM). MANAGEMENT POLICY ON CAPITAL STRUCTURE Bank NTB Syariah's capital structure policy is prepared based on the applicable limits for the required parts of capital, such as the Minimum Capital Adequacy Requirement (KPMM), core capital and supplementary capital. Bank NTB Syariah always strives to maintain adequate capital according to applicable regulations. Its main objective is to ensure that at all times Bank NTB Syariah can maintain its capital adequacy to cover inherent risk in business activities without reducing the optimization of shareholder value. Bank NTB Syariah also periodically conducts the process of assessing capital adequacy (Internal Capital Adequacy Assessment Process-ICAAP) to determine the condition of the capital of Bank NTB Syariah. Then the results of this assessment are routinely submitted to regulators as part of the supervision of the capital of Bank NTB Syariah. The Capital Adequacy Ratio (KPMM) of Bank NTB Syariah is linked to the risk profile of Bank NTB Syariah and is calculated based on Financial Services Authority Regulation No: 21/POJK.03/2014 dated 18 November 2014. Bank NTB Syariah has also included Operational Risk and Credit Risk. in calculating KPMM based on Financial Services Authority Regulation No. 21/POJK.03 /2014 dated November 18, 2014 and the Financial Services Authority Circular Letter No. 13/SEOJK.03/2015 dated 27 April 2015 and the Financial Services Authority Circular Letter No. 34/SEOJK.03/2015 dated December 21, 2015 concerning Calculation of RWA according to Risk for Credit Risk Using the Standard Approach for BUS. Where the Minimum capital according to the Profl Risk for Islamic Commercial Banks which is required by the Regulator is analyzed into 2 (two) tiers as follows: 1. Core capital (tier 1), Core Capital consists of paid-up capital, additional paid-in capital, general reserves and 50% of retained earnings after deducting the less difference between Allowance for Losses on Assets (PPA) and allowance for impairment losses on productive assets. The core capital of NTB Syariah in 2020 is IDR1,378,900 IDR1,374,041 million, while in 2019 it is IDR1,388,360 million. 2. Supplementary capital (tier 2), consists of capital instruments in the form of shares or other forms that meet the requirements, agio or disagio originating from the issuance of capital instruments and classified as supplementary capital, general reserves for write-offs Productf Asset (PPAP) (Maximum 1.25% from Credit Risk RWA). Supplementary capital consists of general PPA reserves. In 2020, the complementary capital for Bank NTB Syariah was IDR.44,778 IDR.44,316 million, while in 2019 it was IDR38,165 million. 191 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  193. The capital structure of the Bank NTB Syariah for 2020-2019 is as follows : (in million rupiah) Description 2020 2019 Capital: Core Capital 1.374.041 Supplementary Capital 1.388.361 44.316 38.165 Amount of capital for credit risk, operational risk and market risk 1.418.357 1.426.525 Credit Risk RWA 3.545.246 3.053.201 Market Risk RWA Operational Risk RWA Amount of RWA for credit risk, operational risk and market risk - - 942.592 968.472 4.487.838 4.021.673 QUANTITATIVE DISCLOSURE OF CAPITAL STRUCTURE Bank NTB Syariah capital has referred to the regulations of Bank Indonesia and the Financial Services Authority with quantitative disclosures as follows: (in million rupiah) Nominal Description Capital Components Core Capital (Tier 1) A. Main Core Capital 1. Paid-In Capital 2. Additional Capital Reserves Addition Factor - Agio common stock - Capital contribution - General backup - Last year profit after Taxes - Net profit for the year - Difference in translation of financial statements - Funds deposit capital - Other comprehensive income Deduction factor - Disagio shares ordinary - Loss of the past years - Loss years running - The difference is less elaboration of reports financial - Other comprehensive income - The difference is less between the PPA on assets productive and CKPN assets productive - Mandatory PPa for non-productive assets 3. Core Capital Deduction Factors Deferred tax Goodwill Other intangible assets Inclusion B. Additional Core Capital Complementary Capital (Tier 2) Agio of Complementary Capital Instruments Disagio From Complementary Capital Instruments General PPa reserves for productive assets that must be formed (at most 1.25 RWA credit risk) Reserve Purpose Complimentary Capital Reduction Factors (Tier 2) Are Investments in Tier 2 Instruments of Other Banks Total Capital Spirit of Amanah, Optimistic and Growth in Sustainable Business Growth 2020 2019 1.374.041 1.374.041 774.900 616.510 697.746 542 566.037 130.166 1.000 81.236 79.722 1.388.361 1.388.361 757.650 648.680 703.982 542 522.940 163.249 17.250 55.302 53.788 (14.320) (14.320) 17.250 (32.170) (6.236) 43.097 (33.084) (16.250) 25.934 25.934 -1,03% -1,03% 2,28% -4,96% -0,89% 8,24% -20,27% -94,20% 46,89% 48,21% 1.514 17.368 15.959 1.409 44.316 44.316 1.514 17.969 16.077 1.892 38.165 38.165 (601) (118) (483) (6.151) (6.151) -3,34% -0,73% -25,51% 16,12% 6,12% - - - - 1.418.357 1.426.526 ( 8.169) -0,57% Nominal % PT Bank NTB Syariah. 2020 Annual Report 192
  194. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e As of December 2020 , the Bank’s core capital amounted to IDR1,374,041 million and for the activities of the Bank’s product and activities to date, based on BUKU, it is classified in BUKU 2 with core capital of at least dan IDR1 Trillion. Table of the Quantitative Disclosure of Capital Structure Description (in million rupiah) 2020 2019 Risk Weighted Assets (RWA) Credit Risk RWA Market Risk RWA 3.545.246 3.053.201 - - 942.592 968.472 4.487.838 4.021.673 9,25% 10,28% From CET 1 8,26% 9,33% From AT1 0,00% 0,00% From Tier 2 0,99% 0,95% CET Ratio 1 30,62% 34,52% Tier 1 Ratio 30,62% 34,52% Tier 2 Ratio 0,99% 0,95% Total Ratio 31,60% 35,47% CET 1 For Buffer 22,35% 25,19% Capital Conservation Buffer - - Countercyclical Buffer - - Capital Surchange for D-SIB - - Operational Risk RWA Total RWA KPMM Ratio according to the Risk Profile Allocation of KPMM Fulfillment KPMM ratio Buffer Percentage That Must Be Fulfilled by Banks RISK MANAGEMENT PRACTICES This part aimed to describe the Risk Management practices to explain the risk types presented in the Risk profile and its management in the Corporate Governance Chapter of this Annual Report. Disclosure of Risk Exposure 1. Credit Risk Credit risk occurs due to the customer or other party's failure to fulfill their obligations to the Bank following the agreement, including credit risk due to debtor failure, credit concentration risk, counterparty credit risk, and settlement risk. Bank NTB Syariah calculating Risk-Weighted Assets (RWA) for credit risk employs a standard approach for Sharia Commercial Banks based on Financial Services Authority Circular Letter Number 13/SEOJK.03/2018 dated September 20, 2018, concerning Amendments to Financial Services Authority Circular Letter Number 34/SEOJK.03/2015 concerning the calculation of risk-weighted assets for credit risk assessment of the implementation of credit risk management to support the business and mitigate the potential of financing activities in an adequate composite manner. For calculating the use of ratings on RWA, always use the assessment set by the regulator. Credit risk management at Bank NTB Syariah includes criteria for providing financing, financing approval, financing management, and portfolio management. The exposure to the low-risk finance and the level of concentration of risk for fund distribution dominates the portfolio for provision of funds and still focuses on musyarakah (profit sharing) financing. Meanwhile, credit risk due to counterparty failure refers to the risk of counterparty default on a contract causing potential losses for the Bank to replace that contract. Counterparty credit risk generally arises from the types of transactions fx swap, repo/reverse repo. Based on the standard approach, the Bank has credit risk RWA as follows: 193 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  195. Tabel 1 : Asset Exposure in the Balance Sheet (in million rupiah) December 31, 2020 No Portfolio Categories 1. Claims to Government 2. Claims to Entities Sector Public 3. Claims to the Multilateral Tagihan Bersih ATMR Sebelum MRK December 31, 2019 ATMR Setelah MRK Tagihan Bersih ATMR Setelah MRK ATMR Sebelum MRK 3.376.017 - - 2.466.962 - - 72.130 36.065 36.065 7.083 3.541 3.541 - - - - - 1 Development Banks and Institutions International 4. Claims to Bank 200.236 40.047 40.047 37 7 7 5. Loan -Backed Home Stay 429.707 150.397 150.397 195.534 68.437 68.437 6. Loan -Backed Property Commercial 3.867 3.867 3.867 2.027 2.027 2.027 7. Employee/Retiree Credit 5.339.969 2.669.984 2.669.984 4.887.288 2.443.645 2.443.645 8. Claims to Enterprises Micro, Small 395.634 296.726 296.726 344.468 258.351 258.351 90.069 90.069 90.069 77.010 77.015 77.015 Business and Portfolio Retail 9. Claims to Corporations 10. Claims That Have Dropped Tempo 49.581 49.581 49.581 33.934 33.934 33.934 484.193 - 227.948 656.105 - 209.694 10.441.402 3.336.736 3.564.684 8.670.448 2.886.957 3.096.652 11. Other Assets Total Tabel 2 : Commitment/Contingent Bill Exposures on Administrative Account Transactions (in million rupiah) December 31, 2020 No Portfolio Categories Tagihan Bersih ATMR Sebelum MRK December 31, 2019 ATMR Setelah MRK Tagihan Bersih ATMR Sebelum MRK ATMR Setelah MRK 1. Claims to Government - - - - - - 2. Claims to Entities Sector Public - - - - - - 3. Claims on Multilateral - - - - - - Development Banks and International Institutions 4. Bill to the Bank - - - - - - 5. Loan -Backed Home Stay - - - - - - 6. Loan -Backed Property Commercial - - - - - - 7. Employee/Retiree Credit - - - - - - 8. Claims to Enterprises Micro, Small 23.432 17.574 17.574 8.294 6.220 6.220 - - - - - - - - - - - - 23.432 17.574 17.574 8.294 6.220 6.220 Business and Portfolio Retail 9. Claims to Corporations 10. Claims That Have Dropped Tempo Total Tabel 3 : Exposures that Cause Credit Risk due to Counterparty Credit Risk (in million rupiah) December 31, 2020 No Portfolio Categories Tagihan Bersih ATMR Sebelum MRK December 31, 2019 ATMR Setelah MRK Tagihan Bersih ATMR Sebelum MRK ATMR Setelah MRK 1. Claims to Government - - - - - - 2. Claims to Entities Sector Public - - - - - - 3. Claims on Multilateral - - - - - - Development Banks and International Institutions Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 194
  196. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e (in million rupiah) December 31, 2020 No Portfolio Categories Net Charges December 31, 2019 RWA before MRK RWA after MRK Net Charges RWA before MRK RWA after MRK 4. Bill to the Bank - 5. Claims to Enterprises Micro, Small - - - - - - Business and Portfolio Retail - - - - - - 6. Claims to Corporations - - - - - - 7. Weighted exposure from Credit - - - - - - - - - - - - Valuation Adjustment (CVA) Total Tabel 4 : Exposures Causing Credit Risk due to Settlement Risk No 1. 2. (in million rupiah) December 31, 2020 Portfolio Categories Exposure Value Net Chargers December 31, 2019 RWA after MRK Exposure Value Net Charges Delivery versus payment - - - - - - a. 8% Capital Expense (5-15 days) - - - - - - b. 50% Capital Expense (16-30 days) - - - - - - c. 75% Capital Expense (31-45 days) - - - - - - d. 100% Capital Expense (> 45 days) - - - - - - Non-delivery versus payment - - - - - - Total - - - - - - Tabel 5: Asset Securitization Exposures No 1. 2. (in million rupiah) December 31, 2020 Portfolio Categories Net Charges December 31, 2019 RWA after MRK Net Charges RWA after MRK Eligible credit facility - - - - Non-eligible credit facility - - - - Eligible liquidity facility Non-eligible liquidity facility 3. RWA after MRK - - - - Securities - - - - Non-eligible Asset-Backed Securities - - - - - - - - - - - - - - - - Eligible Asset-Backed purchases 4. purchases 5. Other securitization exposure which not 6. included regulation principles 7. in Bank Indonesia regarding in undergoing prudent assets securitization activities in banking industries Total 195 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  197. Tabel 6 : Total Credit Risk RWA (in million rupiah) December 31, 2020 RWA Credit Risk Total Capital Deduction Factor December 31, 2019 3.545.246 3.053.201 - - 2. Market Risk The Bank classifies as a non-foreign exchange bank. Thus, it has not implemented trading activities for market making or brokering. It also has no potential to be exposed to exchange rate risk. In other words, based on the Standard approach, the Bank does not have RWA Market Risk. Tabel 7: Disclosure of Market Risks Using the Standard Method December 31, 2020 No Bank Risk Types Capital Expenses December 31, 2019 Consolidation Capital Expenses RWA Bank Capital Expenses RWA Consolidation Capital Expenses RWA RWA Interest Rate Risk - - - - - - - - a. Specific Risk - - - - - - - - b. General Risk - - - - - - - - 2. Risk Value Change - - - - - - - - 3. Equity Risk *) - - - - - - - - 4. Commodity Risk *) - - - - - - - - Total - - - - - - - - 1. 3. Operational Risk Basel Accord II requires Bank NTB Syariah s to include operational risk in calculating their capital adequacy. It has calculated the Minimum Capital Requirement for Operational Risk based on the Basic Indicator Approach, following the regulations from the Financial Services Authority Number 24 / SEOJK.03 / 2017 dated 14 July 2017 related to the inclusion of Operational Risk in calculating the risk of capital adequacy (CAR) other than Credit Risk and Market Risk. Based on the Standard Approach, the Bank Has the following Operational Risk RWA: Tabel 8: Total RWA for Operational Risk (in million rupiah) December 31, 2020 Approach No 1. Gross Income (average 3 years) Capital Expenses December 31, 2019 RWA Gross Income (average 3 years) Capital Expenses RWA Basic Indicator Approach 502,716 75,407 942,592 516,518 77,478 968.472 Total 502,716 75,407 942,592 516,518 77,478 968,472 Disclosure of Exposure faced by Bank NTB Syariah and the mitigiation Following the provisions of POJK No. 65 / POJK.03 / 2016 dated 28 December 2016 concerning the Implementation of Risk Management for Sharia Commercial Banks and Sharia Business Units, Bank NTB Syariah manages 10 types of risk exposures faced by Bank NTB Syariah , namely: 1. Credit Risk Credit Risk refers to the risk due to the customer or other party's failure in fulfilling its obligations to Bank NTB Syariah under the agreement. The main disadvantage faced in this business is the failure of customers to meet their payment obligations. Meanwhile, credit risk management starts with the customer acquisition process. It includes customer selection, payment capacity analysis, and processing maintenance of accounts conducted through fostering good relations process with customers. To support a more prudent financing process, Bank NTB Syariah periodically reviews and refines its financing policies following the latest business developments and regulatory regulations, including ensuring compliance with the implementation of its sharia principles. Besides, the credit risk can also happen due to the concentration of funds provision to the Debtor, geographic area, product, type of financing, or other business fields. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 196
  198. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e Bank NTB Syariah has organizational instruments supporting the implementation of risk management in financing by implementing three foundations in providing finance. They are the business units (Financing Division, Branch Office, and Sub-Branch Office). They initiate the Risk Management Desk as a unit to assess and monitor credit risk; and the administration unit for financing and recovery as a unit that functions to carry out the restructuring process and settlement of problem financing. To manage its credit risk, Bank NTB Syariah implements mitigation in terms of paying attention to the adequacy of the Financing Policy, calculation of collateral, and guarantees to protect Bank NTB Syariah from possible losses caused by problem debtors. The steps applied by Bank NTB Syariah in managing credit risk include: a. Adequacy and development of human resource (risk owner/risk taker) under appropriate training; b. Special handling and supervision of financing accounts in the watch-list category or those with the potential for deteriorating quality; c. Set Limits of Authority in deciding finance to the appointed official. It aims to ensure that the qualified officials implement the financing approvals under the applicable regulations; d. Formulation of strategies for reducing exposure to non-performing financing (NPF); e. Determining the limit of the distribution of financing in the economic sector; f. The stages of setting the core debtor's concentration, pointing to healthier criteria, if necessary, can determine the maximum limit of debtor risk exposure below the Maximum Funds Distribution Limit (BMPD) to ensure that the financing channeled does not exceed the rules set by the regulator; g. Selection of branch market targets based on potential branches and portfolio of existing branch financing (business unit initiatives) evaluated by the Financing Division; h. Determination of levels of financing breakers and the existence of a Reviewer work unit that provides reviews regarding financing submitted by the Branch Office to be decided later by the Financing Policy Committee. 197 PT Bank NTB Syariah. 2020 Annual Report The measurement of credit risk is carried out, among others, through indicators that show the quality of the financing portfolio, including the ratio of low-quality financing portfolios to total portfolio financing (Non-Performing Financing), including the adequacy ratio of reserves to low-quality portfolios. Impairment is a condition where there is objective evidence that an adverse event occurs as the result of one or more events occurred after the initial recognition of the financing provided, and the adverse event has an impact on the estimation of future cash flows for a financial asset or group of it that can be estimated reliably. Bank NTB Syariah uses the incurred credit loss model to recognize impairment losses on financial assets for accounting purposes. Thus, losses are approved if there is objective evidence of a specific loss event. The primary consideration in evaluating the impairment value of given financing, in particular, includes the payment of principal or margin that is more than 90 days or there are difficulties or violations of the terms contained in the original contract. Allowance for impairment losses is calculated using the Incurred credit loss method based on PSAK 50/55 replaced by ISAK 102. Allowance for impairment losses recognized in financial reporting refers to the losses occurring at the financial statements' date of financial position based on objective evidence. The statistical method used is rolled rate analysis and recovery rate. The following is the disclosure of PT Bank NTB Syariah 's net claims: Spirit of Amanah, Optimistic and Growth in Sustainable Business
  199. Quantitative Disclosure of Risk Management Practices a . Disclosure of Net Claims by Regions No (in million rupiah) Posisi Tanggal Laporan (December 31, 2020) Posisi Tanggal Laporan (December 31, 2019) Tagihan Bersih Berdasarkan Wilayah Tagihan Bersih Berdasarkan Wilayah Portfolio Categories Wilayah Lombok 1. Claims to Government 2. Claims to Entities Sector Public 3. Claims to the Multilateral Development Wilayah Sumbawa Wilayah Surabaya Wilayah Lombok - - - - - - - - 72.130 - - 72.130 7.083 - - 7.083 - - - - - - - - - - - - - - - - 383.980 46.122 249 430.351 162.580 33.401 - 195.980 3.685 182 - 3.867 1.962 65 - 2.027 2.807.902 2.540.908 748 240.737 160.900 - 401.637 190.172 86.739 155 3.259 90.153 12.783 20.471 - 33.255 - - - - 3.607.955 2.768.739 4.255 Total Wilayah Wilayah Sumbawa Surabaya Total Banks and Institutions International 4. Claims to Bank 5. Loan -Backed Home Stay 6. Loan -Backed Property Commercial 7. Employee / Retiree Credit 8. Claims to Enterprises Micro, Small 5.349.558 2.576.769 2.316.274 523 4.893.565 158.890 - 349.062 71.307 3.497 2.207 77.010 8.277 14.338 - 22.615 - - - - Business and Portfolio Retail 9. Bill to the Corporation 10. The bill which has been Fell Tempo 11. Other Assets Total 6.380.950 3.018.150 2.526.464 2.730 5.547.344 b. Disclosure of Net Claims by Remaining Contract Periods (in million rupiah) Position Date Report (December 31, 2020) No Portfolio Categories Net bills are based on the remaining term of the contract Net bills are based on the remaining term of the contract >1 year to 3 year <1 year 1. 2. Position Date Report (December 31, 2019) Non Contractual >1 year to 3 year Total >1 year to 3 year <1 year Non Contractual >1 year to 3 year Total Claims to Government - - - - - - - - - - Claims to Entities Sector - 66.935 - 5.194 72.130 - - - 7.083 7.083 - - - - - - - - - - Public 3. Claims to the Multilateral Development Banks and Institutions International 4. 5. 6. Claims to Bank - - - - - - - - - - Loan -Backed Home Stay - 5.889 591 423.871- 430.351 346 7.000 340 188.294 195.980 1.177 1.080 1.158 451 3.867 573 501 478 475 2.027 Loan -Backed Property Commercial 7. 8. Employee / Retiree Credit Claims to Enterprises Micro, Small 487.836 4.346.296 4.893.565 574 66.616 44 59.389 76.810 158.668 106.520 59.639 401.637 62.147 105.588 82.220 99.108 349.062 6.644 39.933 12.120 31.457 90.153 7.927 9.177 16.769 43.138 77.010 1.765 11.147 7.957 12.386 33.255 1.367 7.686 5.168 8.394 22.615 - - - - - - - - - 86.970 350.267 560.293 5.383.419 6.380.950 72.404 189.341 431.948 4.850.420 5.349.558 Business and Portfolio Retail 9. Bill to the Corporation 10. The bill which has been Fell Tempo 11. Other Assets Total Spirit of Amanah, Optimistic and Growth in Sustainable Business 592.810 4.692.789 5.547.344 PT Bank NTB Syariah. 2020 Annual Report 198
  200. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e c . Disclosure of Net Claims by Economic Sectors No Economic Sectors Claims to Government Claims to Entities Sector Public Claims to the Multilateral Development Banks and Institutions International (4) (5) Claims to Bank December 31, 2020 (1) (2) (3) (6) Position Date Report 1. Agriculture, hunting and forestry - - - - 2. Fishery - - - - 3. Mining and Quarrying - - - - 4. Processing industry - 696 - - 5. Electricity, Gas and Water - 5.268 - - 6. Construction - 64.681 - - 7. Trade large and retail - - - - 8. Provision of accommodation and provision of food - - - - and drink 9. Transportation, warehousing and communication - - - - 10. Financial intermediaries - - - - 11. Real estate, venture leasing and services company - - - - 12. Government Administration, defense, - - - - and gurantees 13. Educational services - - - - 14. Health services and social activities - 1.302 - - 15. Community services, social culture, entertainment - - - - and other individuals 16. Services of individuals who serve the house stairs - - - - 17. Firm international and body extras internationally - - - - more 18. Activities that have no clear boundaries - - - - 19. Not a Business Field - - - - 20 Others - - - - Total - 71.948 - - No Sektor Ekonomi Claims to Government Claims to Entities Sector Public Claims to the Multilateral Development Banks and Institutions International (4) (5) Claims to Bank Posisi 31 December Tahun 2019 (1) (2) (3) (6) Posisi Tanggal Laporan 1. Agriculture, hunting and forestry - - - - 2. Fishery - - - - 3. Mining and Quarrying - - - - 4. Processing industry - - - - 199 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  201. (in million rupiah) Loan -Backed Home Stay Loan -Backed Property Commercial (8) (7) Employee Credit / Retired Claims to Enterprises Micro, Small Business and Portfolio Retai Bill to the Corporation The bill which has been Fell Tempo (9) (10) (11) (12) Other Assets (13) - 229 443 99.971 - 8.096 - 42 - 45 3.944 - 628 - - - - 1.828 - - - - 315 - 12.389 3.963 999 - - - - 1.017 - - - - 1.185 - 74.401 46.653 1.638 - 5.125 1.180 20 181.201 3.192 37.217 - - - - 3.862 - 1.513 - - - - 1.120 - 5 - - - - 335 - 78 - - - - 1.438 4.950 379 - - - - - - - - - - - 2.036 224 137 - - - - 5.793 31.906 2 - - 117 - 2.973 - 195 - - - - 1.180 - 195 - - - - - - - - - - - - - - - 402.803 593 2.134.086 5.693 - 5.448 - 21.920 431 3.196.869 2.557 - 24.381 - 429.890 4.051 5.331.462 401.735 90.888 80.910 - Loan -Backed Home Stay Loan -Backed Property Commercial (8) (7) Employee Credit / Retired Claims to Enterprises Micro, Small Business and Portfolio Retai Bill to the Corporation The bill which has been Fell Tempo (9) (10) (11) (12) Other Assets (13) 50 61 - 84.333 5.749 8.327 - - - - 3.677 - 476 - - - - 1.955 - - - - 209 79 7.808 4.764 637 - Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 200
  202. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e No Economic Sector Claims to Government Claims to Entities Sector Public Claims to the Multilateral Development Banks and Institutions International (4) (5) Claims to Bank December 31, 2019 (1) (2) (3) (6) 5. Electricity, Gas and Water - 7.172 - - 6. Construction - - - - 7. Trade large and retail - - - - 8. Provision of accommodation and provision of food - - - - and drink 9. Transportation, warehousing and communication - - - - 10. Financial intermediaries - - - 37 11. Real estate, venture leasing and services company - - - - 12. Government Administration, defense, - - - - and gurantees 13. Educational services - - - - 14. Health services and social activities - - - - 15. Community services, social culture, entertainment - - - - and other individuals 16. Services of individuals who serve the house stairs - - - - 17. Firm international and body extras internationally - - - - - - - more 18. Activities that have no clear boundaries - 19. Not a Business Field - - - 20 Others - - - - Total - 7.172 - 37 d. Disclosure of Claims and Reserves by Regions (in million rupiah) December 31, 2020 No Information Regions Lombok (1) (2) 1. Bill 2. (3) Sumbawa Surabaya (4) (5) Total (6) 3.620.873 2.785.734 4.277 6.410.884 The bill which experienced a decline in value (impaired) - - - - a. Not to fall due - - - - b. Has fallen due - - - - 5. Reserves losses decrease in value (CKPN) - Individual - - - - 6. Reserves losses decrease in value (CKPN) - Collective 20.584 21.300 22 41.906 7. The bill that removed the book - - - 201 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  203. Loan -Backed Home Stay Loan -Backed Property Commercial Employee Credit / Retired Claims to Enterprises Micro, Small Business and Portfolio Retai (9) (10) (8) (7) Bill to the Corporation The bill which has been Fell Tempo (11) Other Assets (12) (13) - - - 41 - - - 300 580 - 37.375 2.835 1.646 - 5.183 779 52 191.360 5.909 32.787 - - - - 5.611 - 1.850 - - - - 1.167 - 35 - - - - 746 - 104 - - - - 2.767 4.950 420 - - - - - - - - - - - 2.146 3.223 - - - - - 1.533 47.636 13 - - - 31 2.360 - 258 - - - - 1.467 - 18 - - - - - - - - - - - - - 175.722 476 2.076.908 2.062 467 5.578 - 14.198 - 2.798.537 1.552 2.279 23.800 - 195.453 2.125 4.875.607 347.962 77.811 14.335 (in million rupiah) December 31, 2019 No Informations Regions Lombok (1) (2) 1. Tagihan 2. (3) Sumbawa Surabaya (4) (5) Total (6) 3.031.310 2.547.994 2.755 5.582.059 Tagihan yang mengalami penurunan nilai (impaired) - - - - a. Belum jatuh tempo - - - - b. Telah jatuh tempo - - - - 5. Cadangan kerugian penurunan nilai (CKPN)-Individual - - - - 6. Cadangan kerugian penurunan nilai (CKPN)-Kolektif 22.828 28.109 26 50.963 7. Tagihan yang dihapus buku - - - - Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 202
  204. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e e . Disclosure of Claims Based on Economic Sectors No Economic Sectors Charges were Experiencing Decrease in Value Bill Not yet Due (1) (2) (3) On Due/expired (5) (4) December 31, 2020 1. Agriculture, hunting and forestry 108.739 - - 2. Fishery 4.658 - - 3. Mining and Quarrying 1.828 - - 4. Processing industry 18.362 - - 5. Electricity, Gas and Water 6.285 - - 6. Construction 188.558 - - 7. Trade large and retail 227.935 - - 8. Provision of accommodation and provision 5.374 - - 1.125 - - 6.767 - - - - - 2.397 - - of food and drink 9. Transportation, warehousing and communication 10. Financial intermediaries 11. Real estate, venture leasing and 413 services company 12. Government Administration, defense and mandatory social security 13. Educational services 14. Health services and social activities 39.003 15. Community services, social culture, entertainment and other individuals 3.285 - - 16. Services of individuals who serve the house stairs 1.375 - - 17. Firm international and body extras internationally more - - - 18. Activities that have no clear boundaries 19. Not a Business Field - - - 2.548.623 - - 3.246.158 - - 6.410.884 - - 20. Others 21. Total Economic Sectors No Charges were Experiencing Decrease in Value Bill Not yet Due (1) (2) (3) On Due/expired (5) (4) December 31, 2019 1. Agriculture, hunting and forestry 98.520 - - 2. Fishery 4.153 - - 3. Mining and Quarrying 1.955 - - 4. Processing industry 13.498 - - 5. Electricity, Gas and Water 7.213 - - 6. Construction 42.736 - - 7. Trade large and retail 236.071 - - 8. Provision of accommodation and provision 7.461 - - of food and drink 203 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  205. (in million rupiah) Reserves losses decrease in value (CKPN) - Individual (6) Reserves losses decrease in value (CKPN) - Collective (7) - 4.746 - 392 - 13 - 665 - 78 - 1.611 - 21.759 - 649 - 169 - 200 - - - 71 36 483 - 112 - 97 - - - - - 2.231 - 8.593 - 41.906 Reserves losses decrease in value (CKPN) - Individual (6) Reserves losses decrease in value (CKPN) - Collective (7) - 5.818 - 378 - 13 - 483 - 89 - 1.524 - 21.040 - 1.112 Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 204
  206. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e No Economic Sectors Charges were Experiencing Decrease in Value Bill Not yet Due (1) 9. (2) Transportation, warehousing and communication (3) On Due/expired (5) (4) 1.202 - - 8.137 - - - - - 5.370 - - 850 10. Financial intermediaries 11. Real estate, venture leasing and services company 12. Government Administration, defense and mandatory social security 13. Educational services 14. Health services and social activities 49.181 15. Community services, social culture, 2.648 - - 1.485 - - - - - - - - - - 19. Not a Business Field 2.261.212 - - 20. Others 2.840.367 - - 21. Total 5.582.059 - - entertainment and other individuals 16. Services of individuals who serve the house stairs 17. Firm international and body extras internationally more 18. Activities that have no clear boundaries f. Disclosure of the details of the allowance for allowance for impairment losses (in million rupiah) December 30, 2020 No Portfolio Categories Individual CKPN Collective CKPN 1. Initial CKPN balance - 2. Establishment (recovery) of CKPN in the current period (Net) - 3. 2.a Establishment of CKPN in the current period - 41.906 - 2.b Recovery of CKPN in the current period 4. CKPN who used to perform delete a book on the bill in the periods - - running 5. Formation (recovery) more in the period running CKPN final balance 205 PT Bank NTB Syariah. 2020 Annual Report - 41.906 Spirit of Amanah, Optimistic and Growth in Sustainable Business
  207. (in million rupiah) Reserves losses decrease in value (CKPN) - Individual Reserves losses decrease in value (CKPN) - Collective (6) (7) - 82 - 475 - - - 74 67 583 - 194 - 38 - - - - - 3.910 - 15.082 - 50.963 (in million rupiah) December 30, 2019 No Portfolio Categories Individual CKPN Collective CKPN 1. Initial CKPN balance - 50.963 2. Establishment (recovery) of CKPN in the current period (Net) - - 3. 2.a Establishment of CKPN in the current period - - - - 2.b Recovery of CKPN in the current period 4. CKPN who used to perform delete a book on the bill in the periods running 5. Formation (recovery) more in the period running CKPN final balance Spirit of Amanah, Optimistic and Growth in Sustainable Business - 50.963 PT Bank NTB Syariah. 2020 Annual Report 206
  208. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e g . Disclosure of Net Claims Based on Portfolio and Rating Scale categories Institutions Rating Agency No Portfolio Categories Standard and Poor’s AAA AA+ to AA- A+ to A- BBB+ to BBB- Fitch Rating Internasional AAA AA+ to AA- A+ to A- BBB+ to BBB- Moody’s Investor Service Aaa AA1 to AA3 A1 to A3 Baa1 to Baa3 AAA(idn) AA+(idn) to AA-(idn) A+(idn) to A-(idn) BBB+(idn) to BBB-(idn) idA+ to id A- id BBB+ to id BBB- (6) (7) Fitch Ratings Indonesia Pemeringkat Efek Indonesia (1) (2) 1. 2. 3. Claims to Government Claims to Entities Sector Public Claims to the Multilateral Development Banks And Institutions International Claims to Bank Loan -Backed Home Stay Loan -Backed Property Commercial Employee / Retiree Credit Claims to Enterprises Micro, Small Business and Portfolio Retail Bill to the Corporation The bill which has been Fell Tempo Other Assets Total 4. 5. 6. 7. 8. 9. 10. 11. (1) (2) 1. 2. 3. Claims to Government Claims to Entities Sector Public Claims to the Multilateral Development Banks And Institutions International Claims to Bank Loan -Backed Home Stay Loan -Backed Property Commercial Employee / Retiree Credit Claims to Enterprises Micro, Small Business and Portfolio Retail Bill to the Corporation The bill which has been Fell Tempo Other Assets Total 4. 5. 6. 7. 8. 9. 10. 11. 207 PT Bank NTB Syariah. 2020 Annual Report Long - term Rating (3) idAA+ to idAA- idAAA (4) (5) - - - - - - - - - - - - - - - (3) (4) (5) (6) (7) - - - - - - - - - - - - - - - Spirit of Amanah, Optimistic and Growth in Sustainable Business
  209. (in million rupiah) December 31, 2020 Net Charges Short-term Rating BB+ to BB B+ to B- Less than B- A-1 A-2 A-3 Less than A-3 BB+ to BB B+ to B- Less than B- F1+ to F1 F2 F3 Less than F3 Ba1 to Ba3 B1 to B3 Less than B3 P-1 P-2 P-3 Less than P-3 BB+(idn) to BB-(idn) B+(idn) to B-(idn) Less than B- (idn) F1+(idn) to F1(idn F2(idn) F3(idn) Less than F3 (idn) id BB+ to id BB- id B+ to id B- Less than isB- idA1 idA2 idA3 to idA4 Less than idA4 (8) (9) (10) (11) (12) (13) No Rating (14) Total (15) (16) - - - - - - - 72.129 - 72.129 - - - - - - - - - - - - - - - - - 90.153 90.153 162.282 162.282 December 31, 2019 Net Charges (8) (9) (10) (11) (12) (13) (14) (15) (16) - - - - - - - 7.082 - 7.082 - - - - - - - - 195.534 2.027 4.887.288 344.468 195.534 2.027 4.887.288 344.468 - - - - - - - 77.010 77.010 84.093 84.093 Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 208
  210. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e h . Disclosure of Counterparty Credit Risk 1) Over the Counter Sharia Hedging Transactions December 31, 2020 Underlying No Variables Notional Amount >1 Year -< 5 Year <1 Year Derivative Derivative Receivables Liabilities Sharia Sharia >5 Year Net Charges before MRK Net Charges after MRK MRK 1. Claims to Enterprises Micro, Small Business and Shariah compliant profit rate swap - Portfolio- Retail - - - - - - 2. Shariah compliant foreign currency - - - - - - - - Others - - - - - - - - Total - - - - - - - - swap 2) Repo Transaction (in million rupiah) December 31, 2020 No Portfolio Categories (1) (2) SSB Repo Fair Value (3) Repo Liabilities Net Charges RWA (4) (5) (6) 1. Claims to Government - - - - 2. Claims to Entities Sector Public - - - - 3. Claims to the Multilateral Development Banks and - - - - Institutions International 4. Claims to Bank - - - - 5. Claims to Enterprises Micro, Small Business and - - - - Claims to Corporate - - - - Total - - - - Portfolio Retail 6. 3) Reverse Repo Transaction (in million rupiah) December 31, 2020 No Portfolio Categories (1) (2) 1. Claims to Government 2. Claims to Entities Sector Public 3. Claims to the Multilateral Development Banks and Net Charges (3) MRK Net charge after MRK RWN after MRK (4) (5) (6) - - - - 72.130 - - - - - - - Institutions International 4. Claims to Bank 5. Claims to Enterprises Micro, Small Business and - - - - 401.637 - - - 90.153 - - - 563.920 - - - Portfolio Retail 6. Claims to Corporate Total 209 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  211. December 31 , 2019 Underlying No Variables Notional Amount >1 Year -< 5 Year <1 Year Derivative Derivative Receivables Liabilities Sharia Sharia >5 Year Net Charges before MRK Net Charges after MRK MRK 1. Shariah compliant profit rate swap - - - - - - - - 2. Shariah compliant foreign currency - - - - - - - - Lainnya - - - - - - - - Total - - - - - - - - swap (in million rupiah) December 31, 2019 No Portfolio Categories (1) (2) SSB Repo Fair Value (3) Repo Liabilities Net Charges RWA (4) (5) (6) 1. Claims to Government - - - - 2. Claims to Entities Sector Public - - - - 3. Claims to the Multilateral Development Banks and - - - - Institutions International 4. Claims to Bank - - - - 5. Claims to Enterprises Micro, Small Business and - - - - Claims to Corporate - - - - Total - - - - Portfolio Retail 6. (in million rupiah) Posisi Tanggal December 31, 2019 No Portfolio Categories (1) (2) 1. Claims to Government 2. Claims to Entities Sector Public 3. Claims to the Multilateral Development Banks and Net Charges (3) MRK Net charge after MRK RWN after MRK (4) (5) (6) - - - - 7.083 - - - - - - - Institutions International 4. Claims to Bank 5. Claims to Enterprises Micro, Small Business and - - - - 349.062 - - - 77.010 - - - 433.156 - - - Portfolio Retail 6. Claims to Corporate Total Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 210
  212. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e i . Disclosure of Credit Risk Mitigation Using a Standardized Approach Mitigating credit risk is implemented by considering the collateral types accepted by Bank NTB Syariah . It then adjusted to the financing type for debtors. The collateral value received is determined equitably to anticipate possible future impairment. Moreover, Bank NTB Syariah can employ the assessment procedure (set by the regulator) to specify the risk weight with the standardized approach. No Portfolio Categories 0% 20% 35% 40% 45% A. Balance Sheet Exposure 1. Claims to Government 3.376.017 - - - - 2. Claims to Entities Sector Public - - - - - 3. Claims to the Multilateral Development - - - - - Banks and Institutions International 4. Claims to Bank - 200.236 - - - 5. Loan -Backed Home Stay - - 429.707 - - 6. Loan -Backed Property Commercial - - - - - 7. Employee / Retiree Credit - 8. Claims to Enterprises Micro, Small - - - - - Business and Portfolio Retail 9. Bill to the Corporation - - - - - 10. The bill which has been Fell Tempo - - - - - 11. Other Assets 256.245 - - - - 3.632.262 Exposure to Commitment / Contingent Liabilities 200.236 429.707 - - B. 1. TClaims to Government - - - - - 2. Claims to Entities Sector Public - - - - - 3. Claims to the Multilateral Development - - - - - - - - - Total Balance Sheet Exposures Banks and Institutions International 4. Claims to Bank - - - - - 5. Loan -Backed Home Stay - - - - - 6. Loan -Backed Property Commercial - - - - - 7. Employee / Retiree Credit - - - - - 8. Claims to Enterprises Micro, Small - - - - - Business and Portfolio Retail 9. Bill to the Corporation - - - - - 10. The bill which has been Fell Tempo - - - - - Total Commitment / Contingent Liabilities Exposure - - - - - C. Exposures due to Counterparty Credit Risk 1. Claims to Government - - - - - 2. Claims to Entities Sector Public - - - - - 3. Claims to the Multilateral Development - - - - - Banks and Institutions International 4. Claims to Bank - - - - - 5. Claims to Enterprises Micro, Small - - - - - Bill to the Corporation - - - - - Total Counterparty Credit Risk Exposure - - - - - Business and Portfolio Retail 6. 211 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  213. (in million rupiah) December 31, 2020 Net Charges after Calculation of Credit Risk Mitigation Impact RWA Capital Expenses 50% 75% 100% 150% Others - - - - - - 72.130 - - - - 36.065 3.336 - - - - - - - - - - - - 40.047 3.704 - - - - - 150.397 13.912 - - 3.867 - - 3.867 358 5.339.969 - - 2.669.984 246.974 - 395.634 - - - 296.726 27.447 - - 90.069 - - 90.069 8.331 - - 49.581 - - 49.581 4.586 - - 227.948 - - 227.948 21.085 5.412.098 395.634 371.464 - - 3.564.684 329.733 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 23.432 - - - 17.574 1.626 - - - - - - - - - - - - - - - 23.432 - - - 17.574 1.626 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n -k Pe r f o r m a n c e Spirit of Amanah, Optimistic and Growth in Sustainable Business - PT Bank NTB Syariah. 2020 Annual Report 212
  214. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e No Portfolio Categories 0 % A. Balance Sheet Exposure 1. Claims to Government 2. Claims to Entities Sector Public 3. Claims to the Multilateral Development 20% 35% 40% 45% 2.466.962 - - - - 7.083 - - - - - - - - - Banks and Institutions International 4. Claims to Bank - 37 - - - 5. Loan -Backed Home Stay - - 195.534 - - 6. Loan -Backed Property Commercial - - - - - 7. Employee / Retiree Credit - 8. Claims to Enterprises Micro, Small - - - - - - - - - - Business and Portfolio Retail 9. Bill to the Corporation 10. The bill which has been Fell Tempo 11. Other Assets - - - - - 446.411 - - - - 37 195.534 - - B. 2.913.373 Exposure to Commitment / Contingent Liabilities 1. TClaims to Government - - - - - 2. Claims to Entities Sector Public - - - - - 3. Claims to the Multilateral Development - - - - - - - - - Total Balance Sheet Exposures Banks and Institutions International 4. Claims to Bank - - - - - 5. Loan -Backed Home Stay - - - - - 6. Loan -Backed Property Commercial - - - - - 7. Employee / Retiree Credit - - - - - 8. Claims to Enterprises Micro, Small 8.294 - - - - Business and Portfolio Retail 9. Bill to the Corporation - - - - - 10. The bill which has been Fell Tempo - - - - - - - - - C. Total Commitment / Contingent Liabilities Exposure 8.294 Exposures due to Counterparty Credit Risk - 1. Claims to Government - - - - - 2. Claims to Entities Sector Public - - - - - 3. Claims to the Multilateral Development - - - - - Banks and Institutions International 4. Claims to Bank - - - - - 5. Claims to Enterprises Micro, Small - - - - - Bill to the Corporation - - - - - Total Counterparty Credit Risk Exposure - - - - - Business and Portfolio Retail 6. 213 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  215. (in million rupiah) December 31, 2019 Net Charges after Calculation of Credit Risk Mitigation Impact RWA Capital Expenses 50% 75% 100% 150% Lainnya - - - - - - - 7.083 - - - - 3.541 364 - - - - - - - - - - - - 7 1 - - - - - 68.437 7.035 - - 2.027 - - 2.027 208 4.887.288 - - 2.443.644 251.207 - 344.468 - - - 258.351 26.558 - - 77.010 - - 77.010 7.917 - - 33.934 - - 33.934 3.488 - - 209.694 - - 209.694 21.557 4.894.371 344.468 322.665 - - 3.096.646 318.335 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 8.294 - - - 6.220 639 - - - - - - - - - - - - - - - 8.294 - - - 6.220 639 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 214
  216. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e 10 . Disclosure of Net Claims and Credit Risk Mitigation Techniques December 31, 2020 No Portfolio Categories Portion Secured by Net Charges Collateral Guarantee 108.739 Credit Insurance UnGuaranteed Sectors Others A. Eksposur Neraca 1. Tagihan Kepada Pemerintah 3.376.017 - - - Tagihan Kepada Entitas Sektor Publik - 3.376.017 2. 72.130 - - - Tagihan Kepada Bank Pembangunan - 72.130 3. - - - - - - Multilateral dan Lembaga Internasional 4. Tagihan Kepada Bank 200.236 - - - Pembiayaan Beragun Rumah Tinggal - 200.236 5. 429.707 - - - Pembiayaan Beragun Properti Komersial - 429.707 6. 3.867 - - - 3.867 7. Pembiayaan Pegawai/Pensiunan - 8. Tagihan Kepada Usaha Mikro, Usaha 395.634 - - - - 395.634 90.069 - - - - 90.069 5.339.969 5.339.969 Kecil, dan Portofolio Ritel 9. Tagihan kepada Korporasi 10. Tagihan yang Telah Jatuh Tempo 11. Aset Lainnya Total Eksposur Neraca 49.581 - - - - 49.581 484.193 - - - - 484.193 10.441.402 - - - - 10.441.402 B. Eksposur Kewajiban Komitmen/Kontinjensi pada Transaksi Rekening Administratif 1. Tagihan Kepada Pemerintah - - - - Tagihan Kepada Entitas Sektor Publik - - 2. - - - - Tagihan Kepada Bank Pembangunan - - 3. - - - - - - Multilateral dan Lembaga Internasional - - - - - 4. Tagihan Kepada Bank - - - - - Kredit Beragun Rumah Tinggal - - 5. - - - - Kredit Beragun Properti Komersial - - 6. - - - - Kredit Pegawai/Pensiunan - - 7. - - - - - 8. Tagihan Kepada Usaha Mikro, Usaha - 23.432 - - - - 23.432 Kecil, dan Portofolio Ritel 9. Tagihan kepada Korporasi - - - - Tagihan yang Telah Jatuh Tempo - - 10. - - - - - - 23.432 - - - - 23.432 Total Eksposur TRA C. Eksposur akibat Kegagalan Pihak Lawan (Counterparty- Credit Risk) 1. Tagihan Kepada Pemerintah - - - - Tagihan Kepada Entitas Sektor Publik - - 2. - - - - - 3. Tagihan Kepada Bank Pembangunan - - - - - - - - Multilateral dan Lembaga Internasional 4. Tagihan Kepada Bank - - - - Tagihan Kepada Usaha Mikro, Usaha - - 5. - - - - - - Tagihan kepada Korporasi - - - - - - Total Eksposur Counterparty Credit Risk - - - - - - 10.464.834 - - - - 10.464.834 Kecil, dan Portofolio Ritel 6. Total 11. Disclosure of Asset Securitization Transactions Bank NTB Syariah does not have asset securitization transactions 215 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  217. December 31 , 2019 No Portfolio Categories A. Balance Sheet Exposure 1. Claims to Government 2. Claims to Entities Sector Public 3. Claims to the Multilateral Development Collateral Guarantee Credit Insurance Claims to Bank 5. Loan -Backed Home Stay 6. Loan -Backed Property Commercial 7. Employee / Retiree Credit 8. Claims to Enterprises Micro, Small - - - - 2.466.962 7.083 - - - - 7.083 - - - - - - 37 - - - - 37 195.534 - - - - 195.534 2.027 - - - - 2.027 344.468 - - - - 344.468 77.010 - - - - 77.010 4.887.288 4.887.288 Business and Portfolio Retail 9. Bill to the Corporation 10. The bill which has been Fell Tempo 11. Other Assets Total Balance Sheet Exposures Other 2.466.962 Banks and Institutions International 4. UnGuaranteed Sectors Portion Secured by Net Charges 33.934 - - - - 33.934 656.105 - - - - 656.105 8.670.448 - - - - 8.670.448 B. Exposure to Commitment / Contingent Liabilities in Administrative Account Transactions - 1. TClaims to Government - - - - Claims to Entities Sector Public - - 2. - - - - Claims to the Multilateral Development - - 3. - - - - - - - - - - Banks and Institutions International - 4. Claims to Bank - - - - Loan -Backed Home Stay - - 5. - - - - Loan -Backed Property Commercial - - 6. - - - - Employee / Retiree Credit - - 7. - - - - - 8. Claims to Enterprises Micro, Small - 8.294 - - - - 8.294 Business and Portfolio Retail 9. Bill to the Corporation - - - - The bill which has been Fell Tempo - - 10. - - - - - - 8.294 - - - - 8.294 Total TRA Exposure C. Exposures due to Counterparty Credit Risk - 1. Claims to Government - - - - Claims to Entities Sector Public - - 2. - - - - - 3. Claims to the Multilateral Development - - - - - - - - Banks and Institutions International 4. Claims to Bank - - - - Claims to Enterprises Micro, Small - - 5. - - - - - - Bill to the Corporation - - - - - - Total Counterparty Credit Risk Exposure - - - - - - 8.678.742 - - - - 8.678.742 Business and Portfolio Retail 6. Total 12. Disclosure of the Summary of Asset Securitization Transaction Activities if the BUS acts as the originator Bank NTB Syariah does not have an Asset Securitization transaction if the BUS acts as an Origin creditor. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 216
  218. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e 2 . Market Risk Market risk refers to the risk occurred when there is a movement in market prices. It includes the value of securities, foreign exchange, commodity prices, and interest rates. It leads to the potential losses caused by changes in market prices and interest rates. Market risk occurs due to the decrease in the balance sheet and off-balance sheet positions due to changes in market prices, including changes in the value of assets that can be traded or leased. In calculating Risk-Weighted Assets (RWA) for market risk, Bank NTB Syariah uses the standard method under SEOJK No.35/SEOJK.03/2015 dated on 21 December 2015 concerning Calculation of Risk-Weighted Assets for Market Risk by using standardized methods for Sharia Commercial Banks. Market risk management at Bank NTB Syariah by the Treasury Division is a risk-taking unit and acts as the first level of defense and is responsible for identifying, evaluating, controlling, and mitigating risks in the business. Measuring and monitoring risk values based on the risk appetite, Bank NTB Syariah manages market risk through a comprehensive policy and limit framework. The Bank is a non-foreign exchange bank that has not carried out trading activities either for market making or brokering, and has no potential to be exposed to exchange rate risk. Ownership of securities is only limited to fulfilling secondary GWM (Sharia Securities issued by Bank Indonesia and the Government/State), while to obtain profit, the Bank is more focused on gaining income from financing distribution. Counterparty Banks are Sharia Commercial Banks, Sharia Private Banks, and Regional Development Banks with a Sharia Business Unit (UUS). Besides, the money market transactions are in the form of SIMA. As for securities instruments, the Bank purchases BI Sukuk (proof of ownership) and Bank Indonesia Sharia Certificates (SBIS) issued by Bank Indonesia. Securities owned by the Bank are held to maturity, causing them unmarked to market. Besides, the payment system for securities ratio is a fixed rate. Therefore, the Bank has an interest rate risk that tends to be low or even almost non-existent. Market risk mitigation strategies carried out by Bank NTB Syariah are: a. Periodically evaluate and improve every policy and procedure that adjusted to the latest conditions and regulations in the context of market risk management; b. Evaluating the market risk exposure inherent in each new product; c. Evaluating and monitoring the level of financing margin per sector/type, savings ratio, time deposit ratio, and current account ratio. d. Monitoring the effectiveness of market risk management through work meetings of the Board of Directors by employing ALMA (Asset Liability Management) Committee meetings. 217 PT Bank NTB Syariah. 2020 Annual Report 3. Liquidity Risk Liquidity Risk is the risk that occurred due to the inability of Bank NTB Syariah to meet obligations. It is influenced by the cash flow funding sources or high-quality collateralized liquid assets without disturbing the activities and financial condition of Bank NTB Syariah. Liquidity risk lay in the functional activities of credit or provision of funds, treasury and investment, financing activities, and debt instruments. The Treasury Division actively manages the Bank's liquidity risk following the limits and parameters approved by ALCO (Asset Liability Committee). Bank NTB Syariah also regulates funding strategies for both usual and emergency conditions. Funding for Bank NTB Syariah in normal conditions comes from the well-managed capital and third-party funds. They are well-managed in that they can enhance a maintained liquidity ratio and maximum profitability. In an emergency, Bank NTB Syariah implements the borrowing strategy utilization to its counterparty. The Bank has conducted the daily monitoring of the vulnerability of the liquidity risk position by considering the Early Warning Indicators and reporting to the ALCO Committee. To overcome liquidity risk and to maintain the continuity of the business of Bank NTB Syariah, risk mitigation strategies are carried out, including: a. Maintain corporate deposits by providing appropriate services and pricing; b. Maintain the pricing level following market prices; c. Coordinate with the planned financing division related to the expansion of financing distribution; d. Mitigate the release of local government funds by ensuring that all SP2D transactions are carried out through Bank NTB Syariah accounts; e. Maintain and increase corporate depositors both in terms of number of depositors and nominal placement by building communication and alliances on an ongoing basis; f. Increasing cooperation with counterparty Bank NTB Syariah (BPD and Bank NTB Syariah) through credit line facilities; g. Conducting repo transactions with Bank NTB Syariah Indonesia on securities held with due observance of the Secondary Statutory Reserves obligation; h. Improve services related to Payment Systems such as BI-RTGS, SKNBI, Taxes, MPNG2; i. Optimizing the placement of funds to obtain optimal capital gains. Bank NTB Syariah measures and monitors liquidity risk indicators through a series of observation ratios. It consists of the FDR ratio, funding concentration, and the adequacy of liquid assets. Besides, it conducts liquidity stress tests regularly. The following is a report on the maturity profile of Bank NTB Syariah in 2020: Spirit of Amanah, Optimistic and Growth in Sustainable Business
  219. (in million rupiah) December 31, 2020 No Pos-Pos Due Date*) Saldo <1 month FINANCIAL REPORT POSITION Asset 1. Cash 2. Giro and Placements at Bank Indonesia 3. Placements at Other Bank 4. Securities Owned 5. Receivables - Murabahah Receivables - Istishna’ Receivables - Sewa Receivables - Qard Receivables 6. Financing Revenue - Mudharabah Financing - Musyarakah Financing 7. Ijarah Financing 8. Other Assets 10.255.354 256.245 1.010.775 3.228.202 256.245 628.416 200.236 2.365.242 200.000 2.090.242 2.171.558 10.814 12.548 4.228.054 457 11.972 2. 3. 4. 5. 6. Liabilities Third-Party Funds - Wadiah Giro - Mudharabah Deposit - Wadiah Savings - Mudharabah Savings - Mudharabah Giro Liabilities to Bank Indonesia Liabilities to Other Bank Securities Issued Financing Received Other Liabilities 1. 2. COMITMENT AND CONTINGENCIES REPORT Comitment Obligations Contingent Obligantions 1 Difference (A-B) 8.844.640 7.408.916 72.222 4.627.208 75.751 2.115.527 518.209 83.302 1.346.161 6.262 1.410.714 >1 month to 3 month >3 month to 6 month >6 month to 12 month 203.743 396.155 132.359 250.000 50.000 >12 month 132.589 6.294.665 236 225.000 7.476 33.477 2.109.612 50 764 10.000 25 62.849 2 87 88.577 52 97.875 8 228 3.938.026 447 11.580 623.953 612.191 7.222 334.020 7.575 211.553 51.821 5.500 2.622.141 2.621.141 7.222 2.342.970 7.575 211.553 51.821 1.000 831.843 831.843 9.028 484.130 9.469 264.441 64.776 - 1.959.597 1.882.796 10.833 1.465.539 11.363 317.329 77.731 76.802 2.807.106 1.460.945 37.917 548 39.769 1.110.652 272.060 - 6.262 - - - 1.346.161 2.604.249 (2.418.398) (435.689) (1.827.008) 3.487.559 40.727 8.446 December 31, 2019 No Pos-Pos Due Date* Saldo <1 month 1. 2. 3. 4. 5. FINANCIAL REPORT POSITION Asset Cash Giro and Placements at Bank Indonesia Placements at Other Bank Securities Owned Receivables - Murabahah Receivables - Istishna’ Receivables >1 month to 3 month >3 month to 6 month >6 month to 12 month >12 month 8.511.717 446.411 1.141.962 2.527.365 446.411 941.962 65.243 - 201.874 100.000 221.526 100.000 5.495.709 - 37 1.325.000 1.100.000 - 50.000 37 - 175.000 2.716.611 - 10.883 - 7.916 - 10.778 - 36.826 - 2.650.208 - Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 218
  220. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e December 31 , 2019 No Pos-Pos Due Date *) Saldo >1 month to 3 month <1 month >3 month to 6 month >6 month to 12 month >12 month - Sewa Receivables - Qard Receivables Financing Revenue - Mudharabah Financing - Musyarakah Financing Ijarah Financing Other Assets - - - - - - 2.864.765 684 16.248 28.101 8 57.302 26 41.031 65 84.413 18 233 2.653.918 666 15.916 2. 3. 4. 5. 6. Liabilities Third-Party Funds - Wadiah Giro - Mudharabah Deposit - Wadiah Savings - Mudharabah Savings - Mudharabah Giro Liabilities to Bank Indonesia Liabilities to Other Bank Securities Issued Financing Received Other Liabilities 7.080.490 6.816.359 74.160 3.513.126 68.693 2.472.348 688.032 93.605 164.746 5.780 1.947.855 1.933.575 7.416 1.603.252 6.869 247.235 68.803 8.500 5.780 1.010.507 1.009.507 7.416 679.184 6.869 247.235 68.803 1.000 - 992.983 987.983 9.270 575.079 8.587 309.044 86.004 5.000 - 1.358.002 1.149.139 11.124 653.654 10.304 370.852 103.205 79.105 129.758 - 1.771.142 1.736.154 38.934 1.957 36.064 1.297.983 361.217 34.988 - 1. 2. COMITMENT AND CONTINGENCIES REPORT Comitment Obligations Contingent Obligantions 579.510 (945.264) (791.109) (1.136.475) 3.724.566 6. 7. 8. 1 Difference (A-B) 1.431.228 4. Operational Risk Operational risk refers to the loss caused by inadequate internal processes, failure of internal processes, human error, system failure, and external events. It affects the operations of Bank NTB Syariah. Operational risk can result in direct or indirect financial losses and create potential lost opportunities for profit. Besides, Operational Risk Management refers to the obligation and responsibility of all Bank NTB Syariah working units. The implementation of operational risk management must be attached to the business and operational processes of Bank NTB Syariah. The Bank should implement all business lines and support functions to identify and analyze factors causing operational risk. It covers business lines, products, processes, services, organizations, and information systems. Operational risk identification also includes a risk assessment of new and changed operational processes, products, systems, and organizations. Bank NTB Syariah conducts a study of all policies, procedures, and other activities to identify all potential operational risks that may arise. The results of the study are in the form of recommendations. Submitting to the relevant work unit, it can get the appropriate and adequate mitigation follow-up. Meanwhile, one of the efforts made is to increase control at branch offices through segregation of duties and responsibilities, dual control mechanisms in the implementation of transaction functions, authorization, restrictions on access system authority, enhancement of employee competence, and internal audits implementation. Following the provision of risk profile regular reports, Bank NTB Syariah conducts sustainable monitoring for all operational risk exposures and losses (loss events) caused by main functional activities. As for fraud management, Bank NTB Syariah has an Anti-Fraud Strategy Policy, which includes duties and responsibilities of employees in the context of fraud incidents, prevention, detection, and handling of fraud. Mitigation strategies to manage operational risk are: a. Conduct sustainable studies and risk monitoring of office operations effectively. b. To make effective anti-fraud policies in the context of comprehensive fraud control. c. Evaluate and improve every policy and procedure periodically and adjust it to the latest conditions and regulations in the context of operational risk management. 219 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  221. 5 . Legal Risk Legal risks occur if there are lawsuits or lawsuits, because of the elements of rights and obligations of each related party, in this case, Bank NTB Syariah with counterparties (external and internal). It happens because parties from Bank NTB Syariah have the right to sue the bank if the bank does not fulfill its obligations. The risk management process focuses on the potential or legal risk inherent in all activities and transactions. Moreover, it includes the identification, measurement, monitoring, mitigation, and legal risk control. All follow the business strategy of Bank NTB Syariah. Besides, legal risk control exists in all transactions and activities of Bank NTB Syariah. In managing legal risk, every new product and activity development must contain a legal aspect analysis. Bank NTB Syariah conducts continuous monitoring of all types of legal risk under the prevailing laws and regulations. Bank NTB Syariah also always carries out evaluations of all indicators that can affect legal risk exposure and potential losses that may arise. Besides, Bank NTB Syariah has a work unit functioning as a legal risk supervisor that can provide analysis or legal advice to every organization level. The Compliance Division, Risk Management Desk, Business Units, and Operations Work Units must assess the impact of provisions or regulation changes on legal risk exposure. The following are the implementation on prevention or mitigation of legal risks: a. Establishment of internal regulations governing the organizational structure and job descriptions of the Compliance Division related to Legal Risk; b. Standardization of every legal document issued and used by the Bank; c. Increasing the competence of related employees in the field of law by participating in legal communication forums organized by related associations and institutions and attending formal and non-formal education in the law area; d. Socializing the impact of applicable regulations on Bank activities in general, various modus operandi of crimes against the Bank and guidelines for handling them legally as well as legal consequences both moral and materially committed by employees to all work units; e. Monitoring and analysis of legal cases currently in legal proceedings at the police and in courts faced by the Bank; f. Inventory, monitoring, and assessment of potential losses caused by the Bank due to legal cases that occur; g. Collaboration with Bank litigation parties (lawyers) to improve understanding of legal issues and a culture of obeying the law for all Bank employees. 6. Reputation Risk Reputation risk refers to a decrease in the stakeholder trust affected by negative perceptions of Bank NTB Syariah. This risk arises due to negative media coverage or rumors about Bank NTB Syariah and the ineffective communication strategy of Bank NTB Syariah. Reputation risk is managed by paying attention to customer complaints and responding to any news that may harm Bank NTB Syariah. Spirit of Amanah, Optimistic and Growth in Sustainable Business The implementation of reputation risk monitoring is, consistently and continuously, based on several factors that appear to be the causes of risk, including negative publications of Bank NTB Syariah owners and related companies, negative media coverage, and customer complaints made by the corporate secretary unit. All officers and employees of Bank NTB Syariah have to maintain its reputation and manage it accordingly. The Management transparency and quality improvement of customer service and other stakeholders relate to the prevailing laws and regulations. Customer complaints and disputes must be handled in a balanced, consistent, and prompt manner by the work unit. They manage these matters under policies and procedures so as not to cause a worse reputation risk. Bank NTB Syariah controls its reputation risk by applying several steps. These steps are under the experiences of Bank NTB Syariah in handling reputation risk. They materially affect its financial condition. In identifying reputation risk, Bank NTB Syariah needs to understand the risks in every activity impacting the reputation, especially those that can significantly affect its financial condition. The mitigation and risk management implement by Bank NTB Syariah are as follow: a. Applying the principle of prudence in managing reputation risk. Especially in identifying the emergence of reputation risk caused by dissatisfaction with customers or other related parties who transact or interact with Bank NTB Syariah, including handling and controlling this reputation risk. b. Applying the principle of openness to reputation risk management implemented by Bank NTB Syariah, in the sense of providing the factual and accurate information required by customers or stakeholders regarding transactions or interactions between Bank NTB Syariah and counterparties. c. Applying the principle of confidentiality. Bank NTB Syariah keeps confidential any information that has not been publically announced by not submitting, disseminating, and leaking to parties who are not entitled to such information. Bank NTB Syariah also keeps the information about customers and their deposits and other transactions to parties who do not have the authority over information. d. Bank NTB Syariah applies good corporate governance where every provision is under the values of transparency, accountability, responsibility, independence, and fairness (TARIF) consistently. e. Perform risk management and active monitoring of news circulating and information on market developments. Resolve/follow up and find solutions to all customer complaints PT Bank NTB Syariah. 2020 Annual Report 220
  222. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e 7 . Strategic Risk Strategic Risk refers to the inaccuracy in making or implementing a strategic decision. It also refers to the failure to cover changes in the business environment. It is due to Bank NTB Syariah establishes a strategy that is not in line with several aspects. They include the different vision and mission of themselves, an incomprehensive strategic environmental analysis, and a mismatched strategic plan between strategic levels. Besides, Strategic Risk also arises due to failure to anticipate changes in technology, macroeconomic conditions, dynamics of competition in the market, and changes in related authorities' policies. Moreover, the Board of Directors determines the strategic plan and business plan. Then, officials or employees of Bank NTB Syariah communicate and discuss the strategic and business plans. The Strategic Planning Division is the one in charge of strategic risk management at Bank NTB Syariah. Bank NTB Syariah implements strategic risk identification in certain functional activities such as credit (provision of funds), treasury, investment, and other operational activities. Bank NTB Syariah also records the changes in performance (a result of the unrealized or ineffective implementation of the business strategy or business plan), especially those that significant for capital. Bank NTB Syariah monitors the development of the strategic planning implementation by considering several aspects. They include the strategic plans' enforcement and deviation, strategic issues from business conditions, and others from the operational activities. The strategic risk mitigation or management carried out by Bank NTB Syariah includes: a. Policies, procedures, and implementation of risk management are continuously refined, updated, and refined periodically to ensure conformity with business developments and applicable regulations. b. Evaluating and developing products, activities, and networks. c. Monitoring performance in financial performance and comparing actual results with expected results (targets) to ensure that the risks taken are within tolerance; d. Bank NTB Syariah collaborates with companies (corporations) to improve the performance of Bank NTB Syariah in terms of deposits and financing. 8. Compliance Risk Compliance Risk is the risk that Bank NTB Syariah does not comply with or does not implement the prevailing laws and regulations and Sharia Principles. Bank NTB Syariah ensures that a sufficient compliance process is under the rules and regulations and applicable to Sharia Principles. These govern every operational activity of Bank NTB Syariah. Bank NTB Syariah also argues that human resources stationed in various work units of Bank NTB Syariah aware of the importance of compliance with the rules and regulations and applicable Sharia Principles. 221 PT Bank NTB Syariah. 2020 Annual Report b. Compliance Risk The Compliance work unit must and is always active in reviewing any financing proposals, cooperation proposals, or c. plans to issue new products or new activities, which require an opinion from the side of regulatory compliance. It implies that Bank NTB Syariah always maintains compliance is in all business activities. d. Besides, there are several ways to maintain compliance with the financial ratios as the Minimum Statutory Reserves (GWM) 8. ratio, Capital Adequacy Ratio (CAR), fulfillment of Allowance for Impairment Losses (CKPN), and Allowance for Earning Asset Losses (PPAP). Furthermore, it is also Non-Performing Financing (NPF), Maximum Financing Limit (BMP), and other ratios. Bank NTB Syariah identifies and analyzes factors that can increase compliance risk exposure and its effect quantitatively on profit and loss and capital. The identification of compliance risk conducted at a minimum in the business activities of Bank NTB Syariah relates to the type and complexity of the business, including new products and activities through examining the number and materiality of non-compliance with laws and regulations as well as applicable Sharia Principles. Bank NTB Syariah 's strategy to mitigate compliance risk is as follow: a. Ensuring the implementation of GCG principles appropriately and sustainably. b. Continuing the studies, providing advice, reviewing, and ensuring that all Bank NTB Syariah policies and procedures meet the applicable regulatory requirements. c. Collaborating with the Sharia Supervisory Board in ensuring compliance of Bank NTB Syariah operations with sharia principles. d. Monitoring problems that occur that will cause compliance risks such as non-compliance with provisions, negligence, and others. e. Ensuring the adequacy of compliance aspects at every planning stage of Bank NTB Syariah. f. Ensuring the operations of Bank NTB Syariah follow and comply with the prevailing laws and regulations. g. Ensuring that each procedure is well-socialized to all employees. h. Increasing Know Your Customer (KYC), Anti Money Laundering (APU), and Prevention of Terrorist Funding (PPT). 9. Rate of Return Risk Rate of Return Risk occurs due to changes in the rate of return paid by Bank NTB Syariah to customers caused by changes in the rate of returns received by Bank NTB Syariah from channeling funds affecting the customers' behavior from third party funds (DPK) of Bank NTB Syariah. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  223. Bank NTB Syariah identi fies and analyzes factors that can increase the risk exposure of sharia returns and quantitatively affect the capital and financing of Bank NTB Syariah's condition with sharia-based. Identification of the risk of sharia returns employs the observation of the comparison of the Rate of Return Risk provided by Bank NTB Syariah with competitors, a history of customer behavior of Sharia funds in the event of a change in yields, and the condition of Sharia funds liquidity when it occurs. Rate of Return Risk management procedures involve the Treasury Division collaborating with the Risk Management Desk and the Accounting and Financial Control Division as work units that carry out the Bank's return risk governance activities. Mitigation and management of yield risk implemented by Bank NTB Syariah include: a. Deciding the pricing policy for DPK customers with a profit-sharing agreement at the ALCO meeting; b. Determining the yield based on revenue sharing that is still competitive in the market; c. Conducting Bank NTB Syariah approaches and communication as well as outreach to the public regarding Sharia Principles; d. Maintaining Bank NTB Syariah the quality of financing to generate maximum profit sharing; e. Increase retail funds and promotional marketing through special programs to encourage public interest and increase the share of retail TPF for Bank NTB Syariah . 10. Investment Risk Investment Risk refers to the involvement of Bank NTB Syariah in the loss of customers' businesses financed in profit-sharing financing using the net revenue sharing method, the profit method, or loss sharing. Bank NTB Syariah identifies and analyzes factors that can increase the risk exposure of sharia investment and affect the condition of the capital and funding of Sharia-based NTB Bank quantitatively. Spirit of Amanah, Optimistic and Growth in Sustainable Business The main objective of risk management for investment risk is to ensure that the providing fund's activities, treasury, and investment, and other Bank NTB Syariah businesses unexposed to investment risks as they cause losses to Bank NTB Syariah . Identification of the risk of sharia investment follows several steps: the introduction of the customer's character, business conditions, income, and industrial sector, as well as the number of funds provided to customers using profit and loss sharing schemes, such as mudharabah and musyarakah. The Bank has established an organization responsible for and plays a role in the investment risk management process's implementation. It covers the Board of Directors, the Financing Division, the Risk Management Desk, and related work units. Several mitigations and management steps implemented include: a. Identification of the risks of investment activities with a profit-sharing contract based on existing portfolios or potential risks, and facilitating the preparation and enforcement of investment’s policies with a transparent and careful profit sharing-based contract. Thus, these risks can be managed and controlled with a pellucid effect. b. Implementation of the investment approval process with an effective profit-sharing contract by setting limits and a mechanism for making investment decisions with a profit-sharing agreement. c. Observation of the concentration of fund distribution using a profit-sharing contract so that it is in line with the risk appetite of Bank NTB Syariah . d. Coordination with the Commitment Making Officer (PPK) and monitoring project progress so that the use of funds is following the financing objectives. e. Selection and evaluation of financing to contractors, starting from the validity of documents to budget plans (RAB) prepared by prospective customers. PT Bank NTB Syariah. 2020 Annual Report 222
  224. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e MATERIAL COMMITMENTS FOR INVESTMENT OF CAPITAL GOODS Bank NTB Syariah has no material ties for investment in capital goods in 2020 . Investment in capital goods (Capital Expenditure) is an activity of spending funds used to buy several fixed assets or add value to fixed assets to provide future benefits for the Bank. INVESTMENT OF CAPITAL GOODS IN THE LAST YEAR To support the smooth operational procedure, the Bank invests in capital goods conducted in Rupiah currency. Hence, the Bank does not have foreign currency exchange rate risk in capital goods expenditure transactions. The Bank's capital expenditures for 2019 and 2020 shown in the following table: (in million rupiah) No Description 2020 2019 1. Land 550 - 2. Investment and building renovation expenditure 5.602 8.597 3. Hardware / Software Expenditure 1.926 2.557 4. Inventories 6.016 8.323 14.094 19.477 Total The source of funding for the purchase of capital goods is the finance from the internal operational activities of the Bank and the purchase of capital goods known by the management. TARGETS ACHIEVEMENT AND PLANNED TARGET In 2020, the national banking industry faced considerable challenges after the Covid-19 pandemic hitting the world. The decline in economic performance in various potential sectors has resulted in several adjustments conducted by the Bank, including its business plan. Thus, the achievement of the Bank's financial performance becomes: (in million rupiah) Description Realization 2020 2020’s RBB Achievement Financial Positions Asset 10.419.759 9.225.313 112,95% Funding provided 6.410.884 6.184.213 103,67% Third Party Funds 7.408.917 6.099.552 121,47% 223 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  225. (in million rupiah) Description Realization 2020 Net-Profit 2020’s RBB Achievement 130.166 127.255 102,29% 100,29% Financial Ratios (%) Minimum Capital Fulfilment (CAR) 31,60% 31,51% Return on Asset Average (ROA) 1,74% 1,95% 89,23% Return on Equity (ROE) 9,54% 9,13% 104,49% Problematic Financing of Total Financing (NPF Nett) 0,77% 0,81% 105,19% 109,52% Problematic Financing of Total Financing (NPF Gross) 1,26% 1,38% Finance to Deposit Ratio (FDR) 86,53% 101,39% 85,34% Operational Expenses to Operating Income (BOPO) 80,39% 82,11% 102,24% In 2020, Bank NTB Syariah 's financial performance showed good results described by the achievement of the 2020 net profit target of 106.20%. In terms of Finance and Third Party Funds, it had exceeded the target with the achievements as 103.67% and 121.47%. Meanwhile, the position of Bank assets reached 113.37%. Furthermore, several main financial ratios have reached the target set. In the future, the Bank NTB Syariah will continue to evaluate the implementation of the estimated strategy. Thus, the performance of Bank NTB Syariah in the future will continue to increase continuously. PLANNED TARGETS In preparing the business plan, it always considers the latest economic opportunities and challenges to maintain the quality and pace of business growth in a sustainable manner. In quantitative terms, the financial report projections of Bank NTB Syariah for 2021-2023 are always directed at solid financial performance while maintaining business growth of Bank NTB Syariah as well as maintaining the quality of financing and maintaining healthy liquidity and capital position as follows: (in million rupiah) Description 2021 Projection Financial Positions Asset Funding provided 10.800.657 7.017.552 Funding: - Third-party funds (DPK) 7.330.386 - Funding Received 1.633.202 Net-Profit 121.965 Financial Ratios (%) Minimum Capital Fulfilment (CAR) 31,39% Return on Asset Average (ROA) 1,54% Return on Equity (ROE) 8,29% Problematic Financing of Total Financing (NPF Nett) 0,79% Problematic Financing of Total Financing (NPF Gross) 1,27% Finance to Deposit Ratio (FDR) 95,73% Operational Expenses to Operating Income (BOPO) 84,62% CAPITAL PLAN The capital plan is prepared to ensure that the Bank NTB Syariah has powerful capital to support its current business expansion strategy and maintain the continuity of future business development. In line with this, the bank also has an intense commitment to fulfilling the provisions regarding a minimum core capital of 3 Trillion by the end of 2024 following the Financial Services Authority Regulation Number: 12 / POJK.03 / 2020 concerning Commercial Bank Consolidation. The Bank capital plan for 2021-2023 is as follows: Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 224
  226. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e (in million rupiah) Year Projection Description 2021 2022 2023 Bank Capital 1.576.927 1.741.122 2.040.369 Core Capital 1.526.581 1.685.738 1.977.472 Complementary Capital 50.346 55.384 62.898 RWA 5.024.454 5.393.370 6.103.829 CAR 31,39% 32,28% 33,43% MATERIAL INFORMATION AND FACTS AFTER THE DATE OF ACCOUNTANT REPORTS There are no significant events or events that have significant influence or require disclosures that occur after December 31, 2020, until the Financial Statements are audited and published. Therefore, the Bank does not present information related to information and material facts that occur after the date of the accountant's report and its impact on future performance and business risk. KEBIJAKAN, PENGUMUMAN, DAN PEMBAYARAN DIVIDEN Based on Law No. 40 of 2007 concerning Limited Liability Companies, that the distribution of dividends is carried out based on decisions in the Annual General Meeting of Shareholders (GMS) or Extraordinary General Meeting of Shareholders (E-GMS). Following the Bank's Articles of Association, the determination of the amount and payment of dividends is carried out following the provisions and regulations in force. The development of dividend distribution can be seen through the following table: (in million rupiah) year Book Description 2020 2019 2018 Income for the year 130.166 163.249 151.904 Income divided 137.466 184.849 162.669 82.479 110.910 97.601 1.063 1.431 1.288 Dividend Dividends per Share* *Dividen per Saham dinyatakan dalam rupiah EMPLOYEE AND/OR MANAGEMENT SHARE OWNERSHIP PROGRAM (ESOP/MSOP) Until the end of 2020, the Bank has not launched a public offering of shares to the public through the capital market, so there is no stock ownership program either ESOP (Employee Share Ownership Program) or MSOP (Management Share Ownership Program). Bank share ownership still consists of Regional Governments, City Governments, and Regency Governments in NTB. 225 PT Bank NTB Syariah. 2020 Annual Report REALIZATION OF THE USE OF FUNDS FROM PUBLIC OFFERING During 2020, Bank NTB Syariah has not issued shares, debt, or bonds, so there is no information regarding the acquisition of funds resulting from a public offering through the issuance of shares, and bonds. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  227. INFORMATION ON MATERIAL TRANSACTIONS CONTAINING CONFLICTS OF INTEREST AND /OR TRANSACTIONS WITH AFFILIATED PARTIES MATERIAL TRANSACTIONS CONTAINING CONFLICTS OF INTEREST No material information contains a conflict of interest in a material transaction with an affiliated party in the period ending on December 31, 2020. TRANSACTIONS WITH AFFILIATED AND RELATED PARTIES The Bank applies PSAK No. 7, "Related Party Disclosures" and Bapepam-LK Regulation No. KEP-347/BL/2012 dated June 25, 2012 concerning "Guidelines for the Presentation and Disclosure of Financial Statements of Issuers or Public Companies" requires the disclosure of relationships, transactions and balances of related parties, including commitments, in the financial statements. A party is considered as a related party to the Bank if: 1. Companies is under bank control 2. Associated companies 3. Investors who have voting rights, which give these investors a significant influence 4. The company is under investor control described in point 3 above 5. Key employees and family members; and 6. Entities that are controlled CHARACTER OF RELATED RELATIONSHIP The Bank conducts business transactions with companies that have the same relationship with Shareholders and/or management as the same Management as the Bank NTB Syariah. Except for employee loans for key employees, these transactions are mainly related to lending and borrowing funds in the normal course of business and have been substantially carried out on normal terms as is done with parties who have no special relationship. No Related Parties 1. West Nusa Tenggara Provincial Govern- Nature Special Relationship Holders of shares controllers ment 2. Key Employees Transaction Current accounts, time deposits, interest expense Directors, Commissioners, Loans, savings deposits, time Division Heads, Branch Managers deposits, interest income, interest expense 3. Executive Officer Governor, Mayor, Regent Loans, savings deposits, interest income, interest expense PURPOSE OF RELATED PARTY TRANSACTIONS The main purpose of conducting transactions with related parties in general is in the interests and business sustainability of Bank NTB Syariah. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 226
  228. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e PURPOSE OF RELATED PARTY TRANSACTIONS In its business activities , the Bank also conducts certain transactions with related parties, including: 31 December 2020 2019 Loans Given Key employees Excecutive officer Regional Government Total Percentage of Loans Given 57.654.427.248 4.043.999.469 556.078.318 1.189.567.584 7.110.634.064 - 65.321.139.630 5.233.567.053 1,02% 0,09% 171.825.702.826 319.961.660.886 4.156.793.843 45.723.139.091 331.813.470 754.774.356 Giro Regional Government Giros Allowance of Pension Pension funds Other Wadiah Current Accounts Others Total Percentage of Giros Amount 8.455.200 7.914.800 1.565.532.172 187.384.586 177.888.297.511 366.634.873.719 29,63% 53,29% 25.000.000.000 55.000.000.000 4.000.000.000 34.000.000.000 - 11.500.000.000 8.120.000.000 7.080.000.000 Time Deposits Cash of Regional/Regional Government Pension Funds Allowance of Pension Key employees - 275.000.000 67.120.000.000 107.855.000.000 1,45% 53,29% Executive Officer 2.583.163.634 2.102.662.301 Key employees 2.636.505.822 1.464.160.480 105.533 7.639.490 Others Total Percentage of Deposite Amount Savings Allowance of Pension Others Total Percentage of Margin Income Amount 15.094.108 72.306 5.234.869.097 3.574.534.577 0,24% 3,07% Margin Income Loans Given 567.822.038 463.477.492 Total 567.822.038 463.477.492 0,93% 0,10% Current Accounts 32.086.268.572 40.248.294.294. Deposits 14.557.110.099 38.755.515.247 Percentage of Margin Income Amount Profit Sharing Expenses Saving Accounts Total Percentage of Profit Sharing Expense 227 PT Bank NTB Syariah. 2020 Annual Report 66.110.871 108.776.470 46.709.489.542 79.112.586.011 24,34% 26,19% Spirit of Amanah, Optimistic and Growth in Sustainable Business
  229. INFORMATION ABOUT INVESTMENT , EXPANSION, DIVESTMENT, ACQUISITION AND RESTRUCTURING OF DEBT AND CAPITAL Bank NTB Syariah does not make investment, expansion, divestment, acquisition and restructuring so that it does not present information regarding the purpose, transaction value and source of activity funds for these activities. CONTRIBUTIONS TO THE COUNTRY Bank NTB Syariah has a role as a taxpayer and as a tax cut / collector as a contribution to the state, The Bank's biggest contribution as a taxpayer is fulfilling the Corporate Income Tax obligations. In addition, Bank NTB Syariah plays an active role in cutting every taxable object in carrying out its function as a tax cut, The following details the tax payment as a form of contribution to the country 1. Prepaid Taxes Bank NTB Syariah prepaid tax in 2020 is a down payment of Corporate Income Tax 25 paid every month according to the Minister of Finance Regulation Number: 215 / PMK.03 / 2018 of 2020. In 2020 there is a change in the Corporate Income Tax 25 rate from 25% to 22% according to with Article 5 Paragraph 1 (a) Government Regulation in Lieu of Law Number 1 of 2020. Prepaid Taxes in 2020 have decreased from 2019 amounting to IDR55,360 million to IDR40,511 million in 2020, the decrease is IDR14,849 million or 26.82%. The following is the realization of prepaid taxes for the period 2020 compared to the previous year: (in million rupiah) Description Income Tax Article 25 2. 2019 40.511 55.360 Nominal % (14.849) -26,82% Tax Debts Bank NTB Syariah Tax Debts in 2020 was IDR9,875 million, decreased by 26.20% or IDR3,506 million compared to the previous year of IDR13,381 million. The decrease in tax debt was due to Income Tax Article 21 of 2020 down 24.14% or IDR7 million, PPH Article 25 down by 2.92% or IDR143 million, and Income Tax Article 29 down by 75.59% or IDR3,940 million. Meanwhile, Article 4 (2) Income Tax increased by 18.82% or IDR583 million. The following is a breakdown of tax debt for the period 2020 compared to the previous year: (in million rupiah) Description 3. 2020 Growth Growth 2019 2020 Rp % Income Tax Article 21 22 29 (7) Income Tax Article 23 77 77 0 -24,13% 0,00% Income Tax Article 4 (2) 3.680 3.097 583 18,82% Income Tax Article 25 4.753 4.896 (143) -2,92% Income Tax Article 29 1.342 5.282 (3.940) -74,59% Total 9.875 13.381 (3.506) -26,20% Corporate Income Taxes Bank NTB Syariah Corporate Income Tax in 2020 under-paid of IDR.1,343 million, while the previous year under-paid was IDR5,282 million. The following is a breakdown of Corporate Income Tax for the period 2020 compared to the previous year: (in million rupiah) Description Current Tax Expense Income Tax Prepaid Income 2020 2019 Growth Rp % 41.854 60.642 (18.788) -30.98% (40.511) (55.360) 14.849 26,82% 1.343 5.282 (3.939) -74,57% Tax Article 25 Underpayment Income Tax (Overpayment) Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 228
  230. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e 4 . Deferred Taxes Deferred tax for Bank NTB Syariah in 2020 was IDR15,959 million, decreased by 0.73% or IDR118 million compared to the previous year of IDR16,077 million. The following is the realization of deferred tax for the period 2020 compared to the previous year: (in million rupiah) 2020 Description Deferred Tax Growth 2019 15.959 Rp 16.077 % (118) -0,73% CHANGES IN LEGAL REGULATIONS AND ITS IMPACT ON BANKS Bank NTB Syariah conducts a review of the new regulations and amendments to the regulations that have been issued by the Regulator to identify the impact that may arise from changes in these provisions and compliance with these regulations: No 1. Regulations Subjects Impact on Bank Financial Services Authority Implementation of Sustainable Bank has compiled Plan of Action Finance Regulation Number: 51/POJK,03/ Finance for Financial Service Institu- Sustainable 2017 tions, Issuers and Public Companies been submitted to the office of the FSA Years 2020-2024 and has representative NTB 2. Regulation of the Members of the Amendment to the Regulation of Board of Governors of Bank the Board of Governors Members Indonesia Number: 21/2/PADG/ Number: 19/8/PADG/ 2017 concern- 2019 ing Sharia Short-Term Liquidity - Financing for Sharia Commercial Banks. 3. 4. 5. Financial Services Authority Prudential Principle in Asset Regulation Number: 11/POJK,03/ Securities Activities for Commercial 2019 Banks. Regulation Authority Services Commercial Bank Reporting end of the financial's Number: through the Financial Services 12/POJK,03/2019 Authority Reporting System Financial Services Authority Implementation of Anti-Fraud Strate- In connection with the stipulation of the Regulation Number: 39/POJK,03/ gy for Commercial Banks POJK, the Bank has conducted a review/ 2019 - - Adjustment of the Bank's Internal Regulations in accordance with the Decree of the Board of Directors Number: SK,01 /14/64/025/2020 concerning the Implementation of the Anti-Fraud Strategy of PT Bank NTB Syariah. 6. Financial Services Authority Rate Return party of the Bank - Circular Letter Number: 9/POJK,03/ 2019 229 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  231. CHANGES IN ACCOUNTING POLICIES AND ITS IMPACT IMPLEMENTED IN 2020 The Indonesian Association of Financial Accounting Standards Board (“DSAK-IAI”) has revised several accounting standards and interpretations of financial accounting standards that became effective on January 1, 2019, as follows: 1. Amendments to PSAK 1: “Presentation of Financial Statements” and Amendments to PSAK 25: “Accounting Policies, Changes in Accounting Estimates, and Errors” Concerning Material Definitions; 2. Amendments to PSAK 25 "Accounting Policies, Changes in Accounting Estimates and Errors"; 3. ISAK 35 “Presentation of Financial Statements for Non-Profit Oriented Entities”; 4. Amendments to PSAK 15 "Investments in Associates and Joint Ventures"; 5. Amendments to PSAK 62 "Insurance Contract"; 6. Amendments to PSAK 102 “Murabahah Accounting”; 7. Amendments to ISAK 101 "Recognition of Tangguh Murabahah Income Without Significant Risk Related to Inventory Ownership"; 8. Amendments to ISAK 102 “Impairment of Murabahah Receivables”; 9. Amendments to PSAK 71, Amendments to PSAK 55, and Amendments to PSAK 60: “Interest Rate Reference Reforms”; 10. Amendments to PSAK 73: Lease concessions related to Covid-19. New standards, interpretations and amendments that are not yet effective: 1. Amendments to PSAK 1: "Presentation of Financial Statements"; 2. The amendments to PSAK 22, "Business combinations"; 3. PSAK 112, "Accounting for Waqf" At the time of issuance of the financial statements, management is still studying the possible impact of the adoption of these new standards and amendments and the impact on the Bank's financial statements. All new standards and amendments are effective for the financial year beginning January 1, 2020, while early adoption of PSAK 73 is permitted if it has implemented PSAK 72 early. At the time of issuance of the financial statements, the management of Bank NTB Syariah still studying the impacts that might arise from the adoption of the new standards and amendments, and their effects on the Bank's financial statements. The adoption of PSAK 71 which replaces PSAK 50, PSAK 55 and PSAK 60 which apply to conventional banking, requires Islamic entities to apply the revised PSAK 102 2019, ISAK 101 and ISAK 102 as of 1 January 2020 for the implementation of murabahah which recognizes income using an effective rate. Meanwhile, the special provisions governing the impairment of value are regulated separately in PSAK 113 which is currently still under development by DSAS-IAI, and temporarily used ISAK 102 as a bridge to PSAK 113. BUSINESS CONTINUITY INFORMATION Until the end of 2020, there were no matters that significantly influence the business continuity of the Bank. This condition was strengthened by the results of the Financial Report that had been audited by the Tanubrata Sutanto Fahmi Bambang Public Accountant Firm & Partners (KAP BDO) which stated that the Bank's Financial Statements had been fairly presented in all material respects. Profit after income tax in 2020 amounted to IDR130,165 million, a decrease of 20.27% or IDR33,084 million compared to 2019 of IDR163,249 million. The decrease in net profit was due to income from other operations that decreased significantly compared to income from Fund management and increased funding expenses Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 230
  232. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e BANK SOUNDNESS LEVELS (TKB) Bank Soundness Level is the result of an assessment of the condition of the Bank based on risks including risks related to the application of sharia principles and Bank performance. In 2019 until 2020, the Bank's soundness rating which was assessed by self-assessment did not change with Composite Rating 2 (PK2). This reflects the condition of the Bank which is generally healthy, therefore it is considered capable of facing significant negative effects from changes in business conditions and other external factors. The following is the assessment of Bank soundness that is assessed by self-assessment in 2020 as follows No Ratings Factor 2020 2019 1. Risk Profile 2 2 2. Good Corporate Governance 2 2 3. Profitability 2 2 4. Capital 2 2 Composite Value 2 2 BUSINESS PROSPECTS After the trade war tensions between the United States and China eased at the end of 2019, uncertainty emerged again in early 2020. The world was in panic due to the rapid spread of the COVID-19 virus. The pandemic that occurred earlier in the year had a bigger impact than the previous trade war. In a period of three months, global economic activity shrank sharply so that the economies of the world's countries contracted and was threatened by a global recession. The COVID-19 pandemic has put considerable pressure on the global and domestic economies, resulting in a low baseline for economic growth in 2020. The impact of the pandemic, which initially became a health problem, has developed into a worldwide social, economic and financial problem. Economic growth in 2020 will be under heavy pressure due to high uncertainty factors. In the current development period (September 2020), based on the press release of the Ministry of Finance of the Republic of Indonesia on November 5, 2020, it was stated that the Indonesian economy grew by -3.49% (YoY), improving from -5.32% (YoY) in the previous quarter. This shows the process of recovery and turning point of national economic activity towards the positive zone. The improvement in economic performance was mainly driven by the role of fiscal stimulus in handling the Coronavirus Disease 2019 (COVID-19) pandemic and the National Economic Recovery (PEN). The absorption of state expenditures accelerated in III quarter, until the end of September it grew by 15.5%, mainly supported by the realization of various social assistance and support for the business world (Micro, Small and Medium Enterprises (UMKM)). The government estimates that the Indonesian economy will begin to enter a period of recovery in 2021. This is based on the assumption that the COVID-19 infection curve has shown a slowdown accompanied by the prospect of vaccine discovery and production, so that this pandemic problem can be resolved quickly. Meanwhile, the banking sector is estimated to remain in the territory of negative profit growth due to slowing economic activity and the extension of credit / financing restructuring for businesses affected by COVID-19 by the authorities until March 2022, assuming that the monitored recovery process will still take time. It is estimated that this will affect bank profits, thereby decreasing further. The Bank as one of the Sharia Commercial Banks in Indonesia as well as the Regional Development Bank has a role in maintaining financial stability and encouraging economic growth. For this reason, it is hoped that the role of the Bank will be maximally in the "new normal" condition to achieve a sustainable business growth rate and support the sharia economic and financial ecosystem in West Nusa Tenggara while contributing to regional development. This is in line with the issuance of Presidential Regulation of the Republic of Indonesia (Perpres) Number 28 of 2020 concerning the National Committee on Sharia Economics and Finance on February 7, 2020 which aims to enhance the development of the Islamic financial and economic ecosystem to support national development. 231 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  233. DBy looking at the prospects for economic growth in Indonesia and the NTB region in 2020 and their potential , Bank NTB Syariah is optimistic to be able to seize opportunities and challenges in the future, including: 1. The development of Islamic finance by the Government through product innovation of sharia financial institutions as well as increasing literacy of public understanding of Islamic financial institution products with the potential for zakat, infaq, shodaqoh, waqf (sizwaf), and considerable haj funds in Indonesia, is an opportunity for Bank NTB. Sharia to increase fund raising outside of Local Government funds; 2. The 2020 State Budget allocation for improving the welfare of Low, Poor and Vulnerable People through housing development in the KPR-FLPP and KPR-SMF programs is an opportunity for Bank NTB Syariah as a source of funding as well as channeling housing finance to the community; 3. Household consumption and LNPRT are predicted to grow at a high rate in line with the inflation rate being maintained in order to maintain and increase people's purchasing power, so that the distribution of financing by Bank NTB Syariah will grow steadily; 4. Government consumption will focus on improving the quality of human resources, accelerating the completion of infrastructure development to support industrialization, accelerating the development of 4 (four) super priority tourist destinations, and other strategic activities. Mandalika Special Economic Zone (KEK) in NTB As one of the super priority tourist destinations to be developed by the Government; 5. The formation of Gross Fixed Capital (PMTB), which is an investment by the private sector, plays a role in driving the national economy. For the Bank, it can be a potential distribution of productive financing; 6. Support from the Regional Government as the Shareholder of Bank NTB Syariah as well as the manager of the Regional Treasury. To support sustainable business growth and respond to existing opportunities, the Sharia NTB Bank Policy in 2020 is focused on: 1. Sustainable and quality business growth; 2. Optimization of retail Third Party Funds (DPK) and other sources of funds; 3. Increase Growth and maintain the quality of Bank financing; 4. Continue to improve business processes that can support the Bank's services and face new challenges; 5. Improve the quality of compliance implementation and strengthen risk management as well as the implementation of Good Corporate Governance (GCG); 6. Fulfill competencies and Total Human Resources (SDI); 7. Strengthening Bank capital from shareholders and increasing the portion of retained earnings and reserves; 8. Encouraging regional economic growth. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 232
  234. M a n a g e m e n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e STRATEGIES AND WORK PLANS IN 2021 STRATEGY FOWARD The strategic steps that will be taken by Bank NTB Syariah to be able to create a highly competitive and strong bank and contribute to the growth and equality of the regional economy , are as follows: 1. Business Development Strategies The business development strategy is concentrated on product development / product features and service improvement as a continuation of the activities of the previous period which are still pending as well as new opening. In addition, sharia lifestyle will be carried out on an ongoing basis to educate and introduce Sharia banking, a. Information system technology development strategies for developing capabilities and capacities in accordance with the business direction and needs of the Bank, namely: 1) Improving infrastructure and developing information technology applications in accordance with the direction of business development, internal needs, and in accordance with applicable regulations; 2) Optimizing the role and function of information technology in internal control of the Bank; 3) Preparing e-channel service in order to support the improvement of more innovative products and services, Development of mobile banking applications with a modern design, user friendly, and increasingly diverse features and transactions, b. Strategies for Collecting Third Party Funds to support the achievement of the Bank's Business Plan for 2021, which are: 1) Financial management collaboration with Government and Private institutions (Government Institutions, Hospitals, Hospitality/Hotels, Schools, Universities, etc,); 2) Management of receiving BPIH deposits in collaboration with Islamic Boarding Schools, Communities, Agencies, etc; 3) Management of non-cash transactions for payment of salaries, routine expenditure, and others at Government Agencies (Pemda) and Private Agencies (BUMD, Private Companies) through the provision of Cash Management System; 4) Joint Agreement in the context of Optimizing Regional Revenues between Banks and all NTB Regional Governments; 5) Socialization / education about Sharia Banking "Blessing Life without Usury" in various regions; 6) Increased marketing of retail DPK products through the Sales Funding Team at all Branch Offices; 7) Improve the type and quality of Bank e-channel transactions through ATMs, EDCs, Mobile banking and SMS Banking 8) services; E-channel activation program at the Bank's institution and customer community through open table activities or expos at 9) office locations, shopping centers and crowds; Repositioning retail customers especially for savings products through diversification of features, products, and services. c. The Financing Distribution Strategy is structured to constantly review the level of financing margins of each segment on a regular basis and establish competitive margins in accordance with market competition conditions, which are: Improving the Financing Improving business processes through the refinement of various policies related to the Process termination of financing. Completion of financing features tailored to market needs. Development/expansion of market segments for financing and financing products. Strengthening administrative order and financing monitoring. Progressively fulfilling the number and increasing the HR competencies through education and training. Productive financing Optimization of financing to dominant local entrepreneurs, especially those that have supply chain links with UMKM actors.; Maintaining loyal Micro customers through the financing of Tunas Sejahtera products; Collaboration with the community of SMEs, the Center for Integrated Business Services of the Regency/City Regional Government for the guided SMEs in each region; Ongoing literacy and outreach in collaboration with Government and communities related to sharia financing to MSMES actors; 233 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  235. Funding to Contractors for working on government projects with funding sources of APBD , APBN / BUMN / BUMD.; Construction financing for housing development, both FLPP and commercial with appropriate risk mitigation; Expansion of the financing segment to Higher Education Institutions (State and Private Universities), Hospitals, and bona fide private companies; Joint financing with national banks and regional banks in the framework of financing large projects through Sindikasi financing; Coordinating with the Ministry of Economy regarding the KUR financing distribution plan. Consumer Financing Maintaining financing to ASN as a captive market through competitive policies and pricing. Optimizing the concept of the supply chain in the distribution of funding to several institutions/agencies including Hospitals, Schools / Colleges, and other potential segments. Collaborating with Developer for housing development for MBR through KPR FLPP financing distribution. Increasing the distribution of consumer financing to other segments (private employees whose payroll salaries are through Banks, Entrepreneurs); Keeping intensive socializing to Local Government Agencies and Private Agencies that have collaborated with the Bank on developing Bank products 2. Human Resource Development Strategy The strategies for developing human resources that will be carried out by the Bank are: a. Improving competencies and developing SDI as a whole by including in various education and training programs as needed; b. Providing equal opportunity to all employees who have met the job requirements to be empowered in the formation of certain positions; c. Paying attention to employee welfare to increase motivation and work ethic; d. Performing regular rotation to avoid employee boredom at work; e. Implement rewards and punishments according to performance. 3. New Product and Activity Development Strategies In 2021, the Bank will continue to focus on completing new products and/or activities that have been planned in the previous period but have not yet been realized, The strategies taken by the Bank in developing new products and activities are: a. Creating superior products and services; b. Consistently maximizing and motoring the Bank's marketing team for funding activities both at Headquarters & Branch Offices; Organizing product promotion and education in Retail segmentation; c. Implementating service standards on an ongoing basis with measurable targets; d. Successing the Non-Cash Transaction program both regionally and nationally through the support of the Bank's optimal e. comprehensive products and services, Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 234
  236. M a n a g e me n t An a l y s i s a n d D i s c u s s i o n o f B a n k Pe r f o r m a n c e WORK PLAN Furthermore , in 2021, Bank NTB Syariah has short- and medium-term plans which are intermediate targets that will be achieved on an ongoing basis until the Bank's vision is realized as follows: 1. Short-Term Plan For the short term, the Bank will focus on implementing the expansion of business segments and the development of IT, services, office networks with the following plans: a. Maintaining the stability of business growth through increased low-cost funds (retail), channeling healthy financing, increasing other sources of income, maintaining liquidity in accordance with regulations, preparing strong capital; b. Improving IT systems and infrastructure as well as other strategic initiatives to support digital banking transformation; c. Increasing the number and competence of SDI; d. Optimizing network and business strategic alliances; e. Improving the results of billing financing for write offs; f. Improving service quality, through the development of physical and electronic networks; g. Strengthening the implementation of GCG in each work unit; h. Maintaining the Bank soundness level on composite 2 (healthy); 2. Medium-Term Plan While for the medium term, the focus and strategy implemented is to solidify the solid foundation (IT, SDI, and products) with the following plans: a. Becoming a market leader in Islamic banking in NTB through healthy and sustainable growth; b. Increase Bank capital; c. Developing retail business by expanding target customers, corporate segments, especially in large private companies that are bona fide; d. Accelerating the implementation of IT systems to anticipate the development of financial technology; e. Developing talent management & career development to improve SDI; f. Realization of the BPD Transformation Program that has been agreed with the BPD SI. 235 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  237. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 236
  238. 05
  239. BUSINESS SUPPORT FUNCTION Strategic Planning Human Resources Information Technology Network , Branch Performance and Electronic Channel Administration, Supervision, and Rescue of Financing Business Risk 239 242 249 255 264 267
  240. Business S u p p o r t Fu n c t i o n STRATEGIC PLANNINGS Strategic Planning allows the bank to set and determine a systematic business decisions or targets by taking into account the latest economic opportunities and changes in order to maintain the quality and business growth in a sustainable manner . Its main function includes guidance and redirection of existing business environment in the context of achieving a satisfactory goal. The business strategies and objectives involve all lines of business and are prepared according to a long-term, medium-term and short-term business framework. The bank's business plans and targets are portrayed in Bank Business Plans (RBB) and Annual Work and Budget Plans (RKAT) which are evaluated constantly so that they remain relevant to the development of economic circumstances. The strategic planning division plays a very significant role in implementing the bank's strategies and business performances by designing business tactics oriented towards dynamic customer needs. STRATEGIC PLANNING ORGANIZATIONAL STRUCTURES In order to accomplish the sustainable business performance, the Bank keeps on making improvements to the organizational structure. This step was taken so that the organs in the bank functioned optimally in achieving the overall targets. The Bank tailored the organizational structure to make the composition more effective and efficient. Based on the Decree of the Board of Directors No: SK.01 / 16/64/022/2020 dated on February 17th, 2020 concerning the Organizational Structure and Work Procedures of PT. Bank NTB Syariah that due to the Director of Finance joined the team and leaded to the alteration of work units under the Board of Directors, the Strategic Planning Division repositioned to work under the main Directorate setting down its previous position under the Directorate of Compliance and Risk Management. As the result, the organizational structure is pictured as follows: PRESIDENT DIRECTOR GENERAL MANAGER Strategic Planning DEPUTY GM Strategic Planning DEPUTY GM Change Management Office Supervisor Research & Transformation Analyst of Financial Plan & Budget Analyst of Strategic Planning Administrative Assistant Analyst of Research & Transformation Analyst of Corporate Culture Administrative Assistant GENERAL MANAGER OF THE STRATEGIC PLANNING DIVISION PROFILE Throughout 2020, the position of General Manager of the Strategic Planning Division was vacant. 239 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  241. THE MAIN FOCUS ON STRATEGIC PLANNING IN 2020 In order to maintain quality business performance and promote the sustainable business growth , the functions and responsibilities of Strategic Planning were focused on 2 (two) main activities including: 1. Bank Strategic Planning The main focus of the strategic plan was designing bank-wide strategies, setting financial targets and controlling budget allocation and performance through the following activities: a. Compiled and formulated a comprehensive corporate business plan including short, medium and long-term planning; b. Integrated top-down and bottom-up planning processes with business units and supporting units; c. Created periodic business unit performance reports to evaluate and monitor the predetermined targets; d. Ensured the operating expenses and capital charges did not surpass the predetermined budget by monitoring the use of expenses periodically. 2. Change Management Office (CMO) Based on the Decree of the Board of Directors No: SK.01 / 16/64/045/2019 dated on March 25th, 2019, the main focus of the Change Management Office (CMO) activity was to oversee the process of implementing the post-conversion transformation program of Bank NTB Syariah and observe the development of the business and operational processes through activities: a. Developed the business and operational processes by benchmarking, based on best practice; b. Managed the information, decided action plans of all business units related to program/project priorities, existing resources and other recommendations that associated with company initiatives in line with strategic transformation needs; c. Created reports regarding the progress of programs/projects to internal stakeholders, Board of Directors, and external stakeholders such as the Board of Commissioners, OJK, ASBANDA to its needs; d. Ensured the implementation of BPD Transformation Program executed according to the initiative strategic by each related work unit; e. Analyzed the development of banking industry as an input for business units to expand more selectively; REALIZATION IN 2020 In 2020, the focus of work of the strategic planning division was to maintain the performance and business growth of the bank in a sustainable manner by planning business transformation programs which was relevant to the latest developments in the banking industry. The conducted works are described as follows: Completed the organizational structure of Bank NTB Syariah gradually in order to meet a suitable organizational composition 1. that facilitated in adjusting to new business opportunities or in overcoming certain problems. The Bank had made several improvements to the organizational structure, first, in accordance with the Decree of the Board of Directors No. SK.01/16/64/001/2020 dated on 2nd January 2020 concerning the Organizational Structure and Work Procedure of PT Bank NTB Syariah about the changes in the division of work under the Board of Directors and addition of a unit in the same l evel as Desk named the Business Risk Desk (RBN) working under the Directorate of Finance and Operations. Second, the changes of organizational structure were relevant with the Decree of the Board of Directors No. SK.01/16/64/022/2020 dated on 17th February 2020 concerning the Organizational Structure and Work Procedures of PT Bank NTB Syariah about hiring a Director of Financing to be in charge in Branch and E-Channel Performance Network Division (JKE) and Financing Division (PBY); as well as transforming the division under the Board of Directors, then the changes were in sync with the Decree of the Board of Directors No. SK.01/16/64/047/2020 dated on 10th July 2020 about the amendment of the Decree of the Board of Directors No. SK.01/16/64/022/2020 regarding the adjustment of several positions in the organizational structure of Branch Offices (Class I,II and III) that was in coherent with the previous Directors' 2. Decree. Designed bank business plan (RBB) of 2020-2022 by taking into account the external conditions and the internal capabilities 3. corresponded with medium and long-term plans of Bank NTB Syariah ; 4. Composed Sustainable Finance Action Plan of 2020-2024; 5. Compiled workplan budget of 2020 through top-down and bottom-up processes with Business Units and Supporting Units; Monitored the realization of business unit performance in 2019 in accordance with the work plan and business targets that had 6. been set on a monthly basis; Organized business meetings in 2020 as the platforms for Board of Management (BOM) in directing general managers of 7. divisions/desks and branch office managers to set company strategies to achieve business targets. Prepared executive materials for the benefit of Management. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 240
  242. Business S u p p o r t Fu n c t i o n WORK PROGRAM IN 2021 At the beginning of 2021 , Bank NTB Syariah had set priorities in maintaining performance and sustainable business growth within the policies as follows; 1. Sustainable and quality business growth; 2. Optimization of retail third party funds (DPK) and other sources of funds; 3. Increasing the economic growth and maintaining the quality of financing; 4. Development & optimization of information technology system infrastructure; 5. Completing the number and competence of Human Resources; 6. Strengthening the bank capital; 7. Improving the quality of compliance & reinforcing the risk management and the good corporate governance (GCG) application 241 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  243. HUMAN RESOURCES Bank NTB Syariah continues to strive in business development professionally with the aim of attaining expected results . The notion of the banking business, which is closely related to gain customers’ trust and serve excellent service, requires aptitude, integrity and professionalism of human resources in all lines of business. Good management of Human Resources (SDI) is a top priority to sustain the quality business growth. Indeed, the alignment of an effective system and reliable human resources is projected to be a series of synergies that steer the performance of Bank NTB Syariah to generate the desired results. HUMAN RESOURCE STRATEGY FRAMEWORK The designated management and development of human resources of Bank NTB Syariah is orientated to the human capital value consists of skills, knowledge and experiences possessed by an individual that lead to influence the productivity of the bank. The employee lifecycle in the human resources management strategic framework of Bank NTB Syariah is illustrated as follows: PLANNING ACQUIRING DEVELOPMENT An appropriate operational strategy and in accordance with the characteristics and culture of the company needs to be developed to ensure that the human resources management policy works well in agreement with the predetermined decisions. Implementation of the right strategy involves the satisfaction, engagement, competitiveness and productivity of human resources that influence the company's business performance. The strategies employed by Bank NTB Syariah are contained within: 1. Planning the requirements of hiring. It was carried out by integrating the company's business plan and the human resources requirement so that a strong and precise blueprint was obtained to produce an optimal level of productivity. Quality and productive human resources always referred to the concept of right people, right skills, right place, right time and right cost. In 2020, Bank NTB Syariah began adapting tactics to accomplish long-term 2. workforce needs. Recruitment and Selection (Acquiring) were an important process to get the best employee candidate that the Spirit of Amanah, Optimistic and Growth in Sustainable Business MAINTAINING 3. PERFORMANCE MANAGEMENT TERMINATION company looked for. As an entity with dynamic business growth and organizational development, Bank NTB Syariah strived to get the right and accurate human rsources by empowering the best male and female ability and capability, particularly, in West Nusa Tenggara Province. Development, as an effort to maintain the survivability of the company's performance in dynamic business transformations and developments, Bank NTB Syariah proposed competency development in the field of human resources. Bank NTB Syariah focused on cultivating employee competencies, both hard and soft competency, through a series of in-house and public training and education programs. Career progress was performed based on the principle of fair, in which every employee had the same rights and opportunities to thrive in consideration of classification of employees’ capacity, their roles, ability and willingness, as well as current standards. PT Bank NTB Syariah. 2020 Annual Report 242
  244. Business S u p p o r t Fu n c t i o n 4 . 5. 6. Maintaining the best workers was one of the keys to survive in the midst of business competition by managing a good remuneration system with expectation of attracting more talented employees outside Bank NTB Syariah. The main purpose of a good remuneration system was to strengthen the company and create a positive atmosphere so that it motivated the employees to maintain their best trait in order to produce top-quality and stable performance. The implementation of the remuneration strategy at Bank NTB Syariah was executed in consideration of the business conditions and capabilities of the Bank in order to accommodate the changes of employee demographics and organized the labor costs. In general, the implementation of the remuneration system included wages, adjustment of the amount of wages every year, holiday allowances (THR), annual leave allowances and long leave of absence given every 6 (six) years of work. In addition, Bank NTB Syariah provided health allowances for the employees and their families in collaboration with BNI Life health insurance, which covered inpatient and outpatient care, childbirth, dental care, the use of glasses and general medical check-up. Moreover, Bank NTB Syariah also offered variable compensation after completing task given such as bonuses, overtime pay, phone credit allowances, company housing and company vehicles. Performance Management, an employee performance assessment of Bank NTB Syariah based on Key Performance Indicators (KPI) and improvement of employee competencies. This system was used with the aim of: a. Ensuring employee performance corresponding to company performance; b. Creating a clear-cut relation between achievement of planned tasks and career development; c. Encouraging, motivating and directing the employees to continuously improve their performance and create a competitive workplace; d. Predicating the performance results to determine the rewards and/or commissions and the classification of talented employee. Termination of Employment. As an industry that operates on a trust basis and every aspect of this business is measured by strict regulations, Bank NTB Syariah always guarantees that all compulsory labor provisions are in accordance with the prevailing laws and regulations, including Termination of Employment (PHK) provision. This provisions that possibly made by the initiative of the employee and/or of a bank involves: a. Upon own request; b. Reaching the normal retirement age; c. Health problems; d. Fraud; e. Indiscipline; f. At fault based on a permanent court decision; g. Passed away. ORGANIZATIONAL STRUCTURE OF THE HUMAN RESOURCES DIVISION The Human Resources Division is a division that has strategic functions and responsibilities as a leading factor in formulating and renewing the strategies, creating action plans that are in line with company goals and policies. Based on the Decree of the Board of Directors No: SK.01/16/64/022/2020 dated on 17th February 2020 concerning the Organizational Structure and Work Procedure of PT Bank NTB Syariah, the human resources division was under the direct supervision of the President Director that had the following responsibilities and functions: 1. Structuring the development and training of Human resources and Personnel administration’s services; 2. Managing the number and quality of employees; 3. Compiling and formulating the main tasks and functions of each organizational position and work procedure in order to measure the performance of employees; 4. Managing the staffs’ welfare; 5. Designing and developing payroll and stratification programs; 6. Recruiting experts/ experienced workers according to the bank's needs; 7. Managing staff databases and files; 8. Executing program of training and education of human resources and personnel administration; 9. Organizing the work performance, assessment, development, and career paths of upper management personnel and development of independent quality; 10. Allowing transfers and rotations of employees proposed by work units and signing documents related to employment in 243 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  245. PRESIDENT DIRECTOR GENERAL MANAGER Human Resources DEPUTY GM Human Resources Management & Services DEPUTY GM Training & Development HUman Resources HR Analyst Recruitment & Training Analyst Administrative Assistant Administrative Assistant Staff waiting for placement THE GENERAL MANAGER OF HUMAN RESOURCES DIVISION PROFILE (Late) Lalu Isnandar Pademan Indonesian citizen, born in Rarang, East Lombok on June 16th, 1967, passed away at the age of 52 years on January 11th, 2021, Lalu Isnandar Pademan completed his undergraduate education at the Faculty of Economics, Mataram University in 1991 and his postgraduate program (S2) in Management at Mataram University in 2006. He started his career at BPD NTB (Village Consultative Body) in 1995 through a recruitment program. Several strategic positions had been entrusted to him, including Deputy Leader of Branch in Selong, Head of sub-division of Human Resources Development and Services, General Manager of the Human Resources Division and most recently as General Manager of the Human Resources Division Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 244
  246. Business S u p p o r t Fu n c t i o n STRATEGIC PLAN IN 2020 The human resource division strived to strengthen the capabilities , capacities and work habit of employees and created a positive, comfortable, and pleasant work environment to encourage the team to give their best performance in order to achieve the vision of Bank NTB Syariah which involved: 1. Preparing the fulfillment of human resources in all units in accordance with the quality and quantity required to accelerate the growth of business processes in gaining market share; 2. Improving the competence of all levels about Islamic banking technical skills, products, communication skills, leadership and risk management; 3. Assessing the potential employees internally to be relocated to new level, managerial in particular, according to the criteria of job description; 4. Improving the quality of management policies, strategies, systems and programs to be in line with the corporate plan; 5. Structuring and executing the internalization of corporate culture value program; 6. Applying the reward and punishment system consistently; 7. Assessing the performance of employees (KPI) by technological system; 8. Giving reward such as production service and/or bonuses calculated based on performance achievement (KPI) with predicate of excellence (125%), very good (110%), good (90%) and sufficient (60%); 9. Reviewing the remuneration/payroll system. RECRUITMENT POLICIES AND IMPLEMENTATIONS In order to meet the needs of talented employees in line with business growth, Bank NTB Syariah carried out structured and systematic planning. The planning was related to employees who met the requirements and had ideal abilities needed by the company. Bank NTB Syariah provided equal opportunities to all employees who had potential, integrity and competence to be assigned in certain positions according for the benefit of the organizational structure. If there were no human resources available in-house with certain qualifications according to the job requirements in the process of fulfilling employees for particular position, Bank NTB Syariah would hire experienced personnel outside the bank. The recruitment of Bank NTB Syariah in 2020 involved: 1. Internal recruitment and employee empowerment. a. Bank NTB Syariah provided opportunities for employees who had undergone retirement but met certain criteria and/or requirements of having integrity, competence, financial reputation, health conditions, and a good work ethic to be recruited into executive level assigned as a contract worker. During 2020, Bank NTB Syariah had recruited 2 (two) contract workers in-house; (recheck HR) b. Employee rotation was carried out to employees who had placed in certain formations for a long enough time in order to set refreshment and risk mitigation that might occur in operational activities due to saturation factors and others. During 2020 Bank NTB Syariah had rotated 110 (one hundred and ten) employees; c. Job promotion was performed to assess the employees to find a potential individual (talent pool) in collaborated with an independent third party. Afterward, each employee was educated and provided in accordance with the targeted position/ formation in order to minimize the occurrence of employee competency gaps. In 2020, Bank NTB Syariah had empowered 110 (one hundred and ten) employees in structural and functional formations set by the Board of Directors in meeting forum. 2. External employee recruitment a. Experience / professional hiring was a recruitment process for personnel who had integrity, competence, and special experience corresponding with the bank's needs. This prosedure aimed to accelerate bank business growth, transfer knowledge and strengthen market intelligence, especially in strategic and critical positions. The benefits expected by the bank through Pro Hire recruitment are as follows: Experience and specialization skills, in order to complete a job more comprehensively, effectively and efficiently; Customization & flexibility, in order to provide a broad perspective in the external scope of Bank NTB Syariah and offer an innovative concept in setting goals and plans of business growth as well as establishing targeted action plans; Pipeline and database, especially in the field of DPK collection and distribution of financing as well as vendor availability. Pro hired staff were expected to be able to take advantage of the relationships that had been made during their tenure outside the organization for the benefit of improving the business performance of Bank NTB Syariah. b. In order to fulfill the long-term administrative staff (long life), Bank NTB Syariah had been recruiting fresh graduates since 2010. This recruitment gave priority to the people of the NTB for a career at Bank NTB Syariah. In 2020 Bank NTB Syariah had accomplished a planned recruitment process of 130 people and started work in early 2021. The 2020-2021 recruitment process was collaborated with an independent third party, the Regional Civil Service Agency (BKD) of West Nusa Tenggara Province with the hope of a fair and quality recruitment process in order to produce reliable and dedicated employee candidates. 245 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  247. The Stages of Bank NTB Syariah Employee Recruitment Process by PT BRIdge 1 6 7 c . 2 Post a vacancy announcement on the website www.bankntbsyariah.co.id 3 Registration Participants were selected using a face-to-face interview method by the recruitment team 4 5 Interview Selection Participants will take a series of tests to find out the work readiness Psychological Test Selection Interview test 9 8 Medical Check Up Interview of the Board of Directors of PT Bank NTB Syariah Outsourcing personnel was completed in the context of fulfilling the supporting personnel such as non-administrative personnel (drivers, security, office boys and technicians), call centers, sales funding, information technology technicians, and graphic designer according to the needs of Bank NTB Syariah cooperated with service providers company known as PT. Persona Prima Utama. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 246
  248. Business S u p p o r t Fu n c t i o n POLICIES AND IMPLEMENTATIONS OF HR COMPETENCY DEVELOPMENT Bank NTB Syariah considers the employees as the main asset that leads to the achievement of targets and vision and mission of the company . Therefore, Bank NTB Syariah remains to increase the quality of employees by performing competency development programs. To obtain human resources covered with integrity, work ethic, professionalism, and competitive, the management of Bank NTB Syariah had taken several strategic policies in the process of employee’s recruitment planning, fulfillment, empowerment and competency enhancement by providing internal and external training programs according to the bank's desires. With competency-based management and the application of a company culture that was implanted through a series of development programs, it is expected that human resources will be able to make an important contribution to the performance and business sustainability of the bank. Throughout 2020, Bank NTB Syariah had completed training and development activities consisted of 30 activities with a total of 1,314 internal participants and 107 activities with a total of 1,342 external participants. In 2020, the focus of human resources development of Bank NTB Syariah was to improve the talents of employees. Employees were given an insight according to their needs in line with business processes of the bank with the intention of minimizing competency gaps. Education and training programs that had been held throughout 2020 included development in aspects of technical skills and soft skills such as bank reporting, financing, products, retail TPF, treasury, risk management, socialization of banking regulations, auditing, information technology, general management, customer services skills, leadership, and others. PERFORMANCE ASSESSMENTS Performance assessment is a measurement directed systematically to evaluate the employees’ performance and/or team’s performance. The evaluation/measurement of employees’ performance and achievement of each unit used Key Performance Indicators (KPI) individually. The results of the performance appraisal were used as a material for consideration in giving rewards, such as bonuses or promotions, to the employees who excelled and had a good work ethic but a penalty to unproductive employees. Reward Rewards were given to employees, either directly or 1. indirectly, to create an enjoyable and challenging work environment so that it motivated employees to improve their performance. In determining the amount of remuneration, Bank NTB Syariah always paid attention to aspects of legal regulations that set minimum wages and eligibility of rewards receipt based on the components of employee benefits and fixed allowances. During 2020, Bank NTB Syariah had offered rewards to employees that consisted of: a. Production services/Dividend of 2019 accounting period paid after the implementation of the annual GMS which was calculated according to the employee's level performance (KPI), with the predicate of satisfactory (125%), very good (110%), good (90%), and sufficient (60%). b. The Length of Service Award (PMB) was given to employees according to their tenure that divided into 5 (five) categories i.e. 15 years, 20 years, 25 years, 30 years and 35 years. c. Retirement Awards (PBB) was granted to a worker who had reached the state pension age. 247 PT Bank NTB Syariah. 2020 Annual Report d. A retirement gift as a token of appreciation for those who were undergoing the retirement preparation period (MPP) in the form of 22 carat gold jewelry weighing 20 grams. e. Religious holiday allowance at the time of holiday celebration adhered by each employee. f. Allowance of annual leave were given to each employee every year and long leave of absence every 6 (six) years; g. Credit allowance according to a certain officials at-cost; h. Hajj Subsidy was allowance for employees who performed the pilgrimage. 2. Punishment Punishment was given by degrees to employees, who didn’t live up to performance standards such as going against the rules of order and discipline and/or committing a fraud. Based on the recommendations of the human resources committee, the punishment was categorized according to the detriment involved and weight of the errors the employees had committed. The management disciplined the employees by degrees in the following order: a. First written warning (SPI); b. Second written warning (SPII); c. Final written warning (SPIII); d. Dissatisfied statements; e. Termination of Employment Spirit of Amanah, Optimistic and Growth in Sustainable Business
  249. 3 . Welfare and Facilities Providing facilities and welfare to employees of Bank NTB Syariah is an act of compensation to improve the life of working class and comfort surroundings so that they stay motivated to perform well in order to achieve the expected objectives of organization. The features of employees’ facilities and welfare are as follows a. Health insurance in collaboration with Healthcare and Social Security Agency (BPJS Kesehatan) and BNI Life; Employment included death insurance, b. BPJS employment injury insurance, life insurance for the seniors and pension insurance; c. Pension insurance with a defined benefit pension program (DPPK) managed by pension funds of Bank NTB Syariah, and a defined contribution pension program (DPLK) in collaboration with DPLK BNI; d. Pension benefits (THT), regulated by PT. Asuransi Jiwa Taspen. Spirit of Amanah, Optimistic and Growth in Sustainable Business PLANS FOR 2021 1 Bank NTB Syariah defines various initiatives regarding SDI management for 2021 focusing on: a. Perfection and implementation of the e-learning program; b. Competence improvement and thorough and continuous development of SDI through various education and training programs on an as-needed basis; c. Provision of equal opportunity to all levels of employees who have met the job requirements to work and be empowered in certain job formations; d. Implementation ofregular rotations to avoid employees getting bored at work; e. Implementing rewards and punishments consistently based on employees’ performance; f. Paying attention to employee welfare to encourage their motivation and work ethic. PT Bank NTB Syariah. 2020 Annual Report 248
  250. Business S u p p o r t Fu n c t i o n INFORMATION TECHNOLOGY 2020 is a year full of challenges because of the Covid-19 outbreak . This condition forces humans to limit their mobility and movement space to suppress the spread of the virus. In this situation, banks are required to provide service facilities that can make it easy for their customers to make transactions regardless of the limitations. Convenience, comfort, security and sustainability are a set of conditions that are increasingly seen as something that almost all users of banking services cannot negotiate anymore. This is also the condition that customers or prospective customers often considering evaluating the services offered by a bank. Bank NTB Syariah understands that Information Technology (IT) capability is the key to strive to innovate to improve service quality for customers. This is in line with one of the defined missions i.e. expanding service coverage for access and transactions through the deployment of reliable technology. In 2020, Bank NTB Syariah focused on developing Electronic Banking, Digital Banking, increasing the effectiveness and efficiency of business processes, and deploying technology following the IT Blueprint which is focused on the bank’s business development needs. INFORMATION TECHNOLOGY STRATEGIC POLICIES AND INITIATIVES IN 2020 For future business development, Bank NTB Syariah has a series of strategies to improve its service, especially for e-banking, including: 1. Increasing the number ATM and EDC Merchant terminals; 2. Adding variations in Payment and Purchase features at ATM, Mobile Banking and SMS Banking; 3. Increasing the deployment of electronic SMS Banking, Mobile Banking and branchless banking service products 4. Increasing the marketing and use of Corporate Cash Management System Services and developing delivery channel services for payment systems and other transactions; 5. Development of Mobile Banking products integrated with a (Quick Respone Code Indonesian Standard (QRIS)-based payment system Additionally, Bank NTB Syariah takes several strategic initiatives to improve product competitiveness in the digital industrial era including: 1. Developing modern and digital banking productswhich orientates towards customer-centric digital banking to increase Customers Engagement with the bank’s products; 2. Continuously strengthening and enhancing the Human Resourcesinformation technologycompetencein line with the development of modern banking technology and the bank’s needs. 3. Strengthening information technology infrastructure by increasing system availability and reliability and transforming from traditional servers to cloud computing technology, virtualization, and increasing system security in maintaining data confidentiality and customer protection; 4. Service transformation and innovation towards digital banking by simplifying and automating processes to increase the effectiveness and efficiency of technology in delivering Bank services; 5. Managing information technology independently is deemed necessary to increase the time to deliver products and adapt to technological changes. Independent technology development will have an impact on improvement of quality, service speed, process transparency, end to end system interoperability. 249 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  251. INFORMATION TECHNOLOGY DIVISION ORGANIZATIONAL STRUCTURES Information technology management at Bank NTB Syariah is the responsibility of the Information Technology Division which is led by a General Manager under the coordination of the President Director . The organizational structure of the Information Technology Division refers to the Decree of the Board of Directors Number: SK.01/16/64/022/2020 dated on February 17th, 2020 concerning the Organizational Structure and Work Procedure of PT Bank NTB Syariah, by adjusting the digital banking function which function is to implement, ensure , and manages IT operations, carries out system maintenance monitoring and adjustments to information technology, business models, business processes, internal control, to support the convenience, security, reliability of digital banking services and to produce Monthly Reports on the development of digital-based services. PRESIDENT DIRECTOR GENERAL MANAGER Information & Technology System DEPUTY GM Planning and Development of Information Technology and Networks Supervisor Supervisor IT Operation IT Development Analyst IT Operation Analyst Development Administrative Assistant Administrative Assistant Supervisor IT Development Digital Banking Analyst Development Administrative Assistant GENERAL MANAGER OF TECHNOLOGY AND INFORMATION DIVISION PROFILE Hari Hartanto Edi Asmara Hari Hartanto Edi Asmara is an Indonesian citizen, born in Yogyakarta on September 14, 1967, aged 53. He completed his undergraduate degree at the Faculty of Law, Universitas Islam Indonesia in 1993. He Started his career at BPD NTB in 1995 through a recruitment program. He has been entrusted strategic positions i.e. as a chief of the Information Technology Development Sub Division and most recently as a General Manager of the Information Systems Technology Division. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 250
  252. Business S u p p o r t Fu n c t i o n THE PURPOSES OF INFORMATION TECHNOLOGY STRATEGIC INITIATIVES Strategic initiatives in Information Technology aim to establish customer-centric business processes in the use of Bank NTB Syariah products and services . This objective is described as follows: 01 Able to deliver banking products and services quickly, transparently, safely and easily to all stakeholders through modern banking information technology facilities 02 03 Creating a reliable and integrated information and communication technology architecture and platform /inter-systems and capable of interacting with other systems to produce a more concise, transparent and efficient work process according to the strategic objectives stated in the Corporate Plan of Bank NTB Syariah Able to support digital technology transformation orientate towards the convenience and excellence of technology systems in digital transaction processing. INFORMATION TECHNOLOGY ARCHITECTURES The infrastructure of communication networkthat the Bank uses is the multi-provider access connection. The network access used consists of Fiber Optic Media Connection, VSAT Connection, Machine to Machine Connection and Broadband Wireless Access. The diversity of media access can provide convenience, speed, reliability and the availability of all communication links at the Branch Office networks, ATM Network and Electronic Channel Services throughout the region. To maintain the availability of communication links, the entire Bank’s Networks have been equipped with a backup link via the VSAT Connection media access. Communication via satellite can be an alternative in case the fiber optic infrastructure is disrupted. Moreover, to improve network performance and swing, all networks have been equipped with a router by using the routing border gateway protocol (BGP) configuration. As an attempt to keep up with the development of modern banking information technology and meet its business needs, the bank perfected the Landscape Architecture Application scheme as follows: MIDDLEWARE API CORE BANKING SYSTEM CUSTOMER MANAGEMENT CORE BANKING SYSTEM FE BE DB DELIVERY CHANNEL GATEWAY 724 REPORTING SYSTEM CMS SWITCHING SYSTEM DATA WAREHOUSE ANALYTIC MODEL EKSTERNAL APP The description of the Information Technology Landscape Application Architecture of Bank NTB Syariah is as follows: 1. Middleware API Core Banking System is a standard web service used to carry out financial and non-financial transactions towards the Core Banking System; 2. Customer management; as an internal and external management system consisting of CRM, HRIS, FOS, Document Management System; 3. Core Banking System; as a data processing center that uses integrated multi-database of the frontend system and the backend system so that the bank can provide 24/7 service. 4. Delivery Channel is an access channel for customer to banking products such as ATM services, CMS Corproate, mobile banking, SMS banking, Branchless banking service, Non-Cash School Operational Funds (BOS), EDC, etc. 5. Gateway 724 is a system that functions as an integrator between the core banking system and electronic switching in handling all transactions via ATMs, EDCs and other banks; 6. The reporting system consists of several applications used to submit reports to external parties and regulators; 251 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  253. 7 . 8. Data warehouse and analytical models consist of a collection or mining of data used as a reference in presenting financial reports. It can be processed according to the bank’s business needs to accelerate the determination of policy direction or strategic decision, External App is a platform, an application integration between Bank NTB Syariah and other strategic partners for the development of an integrated system, so that it is possible to exchange data electronically, safely, transparently, easily and in real time NETWORK AND DATA CENTER (DC) INFRASTRUCTURES In Adequate IT infrastructure is essential to ensure the high availability of the system to support the operations of Bank NTB Syariah24/7. The infrastructure of Data Center and Disaster Recovery Center refers to the strength standard of Tier III and Tier IV. Some of the advantages of the bank’s infrastructure are: 1. The production server uses more than one machine in the cluster system configuration, each of which is a backup of the other machines so that when a problem occurs or when there is maintenance on one of the machines, the operation will not be interrupted/stopped. 2. Using a load balancing mechanism that ensures operations are running continuously and stable because the system automatically divides the workload of database and applications. 3. Resources scalability can be done easily when the load from the available machine has exceeded the threshold. 4. The server that is set up in DRC has the same specifications and configuration as the DC. So, if there is a transfer, it will not affect the quality of service. 5. Hot backup system from DC to DRC using HADR/SQL replication technology which features real time replication with maximum fast recovery. 6. Operational support and monitoring of all IT services is active 24/7, so it can detect problems quickly OLIBS 7/24 CLIENTS @DATA CENTER @DRC OLIBS 7/24 APPLICATION SERVER OLIBS 7/24 APPLICATION SERVER BACK - END (BE) FRONT - END (FE) Server Server #n #1 (JBOS) (JBOS) Web Server #1 Clustering System Web Server #n Clustering System FRONT - END (FE) GATEWAY / H2H / LAIN2 Server #1 Server #n MIRRORING Clustering System Server Server #1 #n (JBOS) (JBOS) BACK - END (BE) Web Server #1 Clustering System DATABASE FRONT - END (FE) SERVER #1 Power HA pure Scale CF (Cluster Cache Facility) LPAR Technology Web Server #n Clustering System OLIBS 7/24 DATABASE SERVER GATEWAY / H2H / LAIN2 Server #1 Server #n Clustering System OLIBS 7/24 DATABASE SERVER DATABASE FRONT - END (FE) DATABASE BACK - END (BE) SERVER #2 Power HA pure Scale CF (Cluster Cache Facility) LPAR Technology SHARED SAN STORAGE DB2 POWER HA pureScale CLUSTERING SYSTEM Spirit of Amanah, Optimistic and Growth in Sustainable Business DB2 HAD / SQL Replication SERVER #1 Power HA pure Scale CF (Cluster Cache Facility) LPAR Technology DATABASE BACK - END (BE) SERVER #2 Power HA pure Scale CF (Cluster Cache Facility) LPAR Technology SHARED SAN STORAGE DB2 POWER HA pureScale CLUSTERING SYSTEM PT Bank NTB Syariah. 2020 Annual Report 252
  254. Business S u p p o r t Fu n c t i o n INFORMATION TECHNOLOGY GOVERNANCES Changes in the increasingly competitive banking industry have encouraged Bank NTB Syariah to take advantage of Information Technology to achieve business growth . The current trend in the banking industry is towards digital banking which can make transactions easier for customers. Information technology governance is always adjusted to both short and longterm goals, and iscarried out according to the bank’s vision and mission. The information technology governance deployed is expected to build reliable infrastructure and systems. The Information Technology Governance System of the Bank was prepared to comply with Information Technology Governance. Hence, for the best practice, it is focused on 5 (five) areas as follows: 1. Strategic Alignment ensures that the direction of planning, development, operation of Information Technology is in line with the strategy of the bank; 2. Value delivery ensures that the value generated by Information Technology can be used by the bank to achieve optimal benefits. 3. Risk management ensures that every Information Technology activity always considers the risks that may arise, and that mitigation is done so as to minimize the risk it may cause. 4. Resource management ensures that Information Technology Human Resources are properly managed. 5. Performance measurement makes sure that the performance of Information Technology services is measured regularly and each Information Technology process and the use of Information Technology resources are documented. STRATEGIC ALIGNMENT IT GOVERNANCE PERFORMANCE MEASUREMENT VALUE DELIVERY RISK MANAGEMENT RESOURCE MANAGEMENT DIGITAL BANKING MANAGEMENTS In facing competition in the banking industry, several information technology innovations have been made to meet the business needs. Therefore, supports and strategies implemented are as follows: System development to automate business processes integrated end to end from the producer, distribution, to consumer. Developments and enhancements for digital banking needs oriented towards the Bank's e-channel services and products. Digital Banking Management Able to provide digital services through applications, devices, and infrastructure as a delivery channel that can be used anytime and anywhere. 253 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  255. PLANS FOR 2021 The Road Map of the development of Information Technology 2021 is more focused on the implementation of digitalization in the service distribution network and business processes of the bank which concept is improving the Core Banking System , Surrounding System, developing features / billers on delivery channels, Omni Channels, Reporting Systems, support systems and Bank business support applications. II I CORE BANKING SYSTEM SURROUNDING SYSTEM Continuous development of the core banking system to support and develop new products that provide choice and convenient customer service The development of the surrounding system aims to digitize the applications used to support operations and process automation, especially for reporting and presenting data compilation needs. IV III TECHNOLOGY INFRASTRUCTURE The Bank concentrates on preparing infrastructure that is oriented towards high availability, reliability, and security so that it can provide modern banking services that are integrated, reliable, fast, transparent, and safe Spirit of Amanah, Optimistic and Growth in Sustainable Business DIGITALITATION OF TECHNOLOGY In developing technology-oriented digital banking services, technology transformation is carried out towards the industrial era 4.0 which is oriented towards Open API (Application Programming Interface) technology, Omnic Channel, Cloud Computing, and Big Data. PT Bank NTB Syariah. 2020 Annual Report 254
  256. Business S u p p o r t Fu n c t i o n NETWORK , BRANCH PERFORMANCE AND ELECTRONIC CHANNEL The expansion of the branch office network is an important element in providing access for customers to products and services in addition to increasing brand awareness. Moreover, excellent operational service quality is the bank’s commitment to provide the best customer experience for customers. The Bank strives to always provide the best solutions to customer needs through process improvements, improving SDI quality, and improving electronic channel services. NETWORK, BRANCH PERFORMANCE, AND ELECTRONIC CHANNEL DIVISION ORGANIZATIONAL STRUCTURES In 2020, by the virtue of the Decree of the Board of Directors No.: SK.01/16/64/022/2020 dated 17 February 2020, an additional Directorate of Finance and changes in the division of work units under the Board of Directors have been added. This change makes the JKE Division which was previously under the Directorate of Funds and Services is now under the Directorate of Financing. DIRECTOR OF FINANCING GENERAL MANAGER Network, Branch Performance, and E-Channel DEPUTY GM BO Kelas I, II, III DEPUTY GM Network Development and Branch Performance Electronic Network Transactions and Services SBO Kelas I & II Supervisor E-Channel Analyst Network Analyst Branch Development Administrative Assistant 255 PT Bank NTB Syariah. 2020 Annual Report Service Quality Office Administrative Assistant Analyst e-Channel Administrative Assistant Analyst ATM Center Administrative Assistant Spirit of Amanah, Optimistic and Growth in Sustainable Business
  257. Network Division , Branch Performance and Electronic Channel Division is led by a General Manager and is under the coordination of the Funds and Services Director. 1. Network Development and Branch Performance which duties and responsibilities include: a. Compile and formulate policy design, systems and procedures, strategies and development of branches; strategies and programs for branch b. Define development; c. Managing Branch Performance (Financing, Fund Raising and Bank Services); d. Analyze the needs of Branch Development; e. Manage Office Networks; f. Manage ATM network development; g. Manage other outlets of the Bank. 2. E-channel transactions & services which duties and responsibilities include: a. Review the development/improvement of service systems and procedures; b. Managing Network and Service Development and its Performance; c. Define strategies for development and marketing of E-channel; d. Development and Management of Network and Service; e. Defining development plans for Branch offices in terms of Excellent Service; f. Coordinating with related work units in terms of network and service development; g. Coordinating the process of opening/closing/relocating Branch Offices with the Planning Division (REN); h. Monitoring and developing E-channel; i. Managing cooperation for E-channel development; j. Managing marketing of E-channel. GENERAL MANAGER OF NETWORK, BRANCH PERFORMANCE, AND ELECTRONIC CHANNEL DIVISION PROFILE H. Muhammad Taufiq Gozi An Indonesian citizen, born in Mataram on August 22, 1965, aged 54. He completed his undergraduate degree at the Faculty of Economics, Universitas Mataram in 1989, Postgraduate Program (master’s degree) at Master of Management at Universitas Mataram in 2003 and Postgraduate Program (Doctorate degree) in the Department of Islamic Economics at Universitas Airlangga in 2015. He started his career at BPD NTB in 1990 through a recruitment program. Several strategic positions have been entrusted to H. Muhammad Taufiq Gozi, including as Sub-Branch Sweta Manager, Chief of Secretary Desk Leader, Chief of Strategic Planning Sub-Division Leader, Chief of Network and Service Development Division, Chief of Sharia Business Unit Division, General Manager of Retail Funds and Product Development Division, and finally as General Manager of Network, Chief of branch performance and e-channel Development Division. WORKING PROGRAMS IN 2020 The work program of the Network, Branch Performance and Electronic Channel division in 2020 is focused on expanding the Bank's electronic network and services to support the achievement of a healthy and sustainable business, namely: 1. Network Development and Branch Performance To improve performance and sustainable business growth after the conversion, Bank NTB Syariah seeks to increase business capacity and strengthen internal aspects through: a. Adding the outlets of service office network by considering administrative needs, ease of coordination amongst branches, as well as distance between an office and the other offices, and opening/enovating more modern offices, especially bank offices to make it easier to improve services for a better business performance; b. Developing office networks by opening new offices and temporary relocation (renovating existing buildings) which support the bank’s business growth i.e.: Opening the new Supporting Branch Offices: Lopok 1) and Pekat, Opening the new cash offices: Raba Bima dan 2) Purnabakti New Service offices: Bagu Pringgarata, PLHUT of the 3) Ministry of Religion of Central Lombok, and Lombok Epicentrum Mall Transferring and change of name of Karang 4) Jangkong Supporting Branch Office to Sriwijaya Branch Office c. Adding 3 (three) units of Car Service Network to widen thearea of service and bank promotion branding. b. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 256
  258. Business S u p p o r t Fu n c t i o n 2 . Development of E-channel transaction and services The application of Digital Banking is one of the Bank's steps to compete in today's digital era. The Bank's service transformation is not only focused on branch offices.The Bank's e-channel is intended to facilitate customers in making transactions in real time easily, safely, comfortably, anytime and anywhere. In addition, e-channel services have menus and features that are more attractive and friendly use, making it easier for customers to transact. In 2020,the bank performed its function as a service provider that has an effective and comprehensive payment system through the following activities: No 1. Payment System Service Activities Release/Launching Adding ATM Features: a. JCB Cash Advance Principal Transactions August 2020 b. AMEX Principal Cash Advance Transactions December 2020 c. December 2020 Property tax Payment for West Lombok District, Dompu District and Bima City d. Water bill payment for Central Lombok District March 2020 2. SMS Banking Service January 2020 3. Adding Mobile Banking Features: a. Adding purchase features for Telkomsel Prepaid with various Denomination b. Adding ZISWAF (Baznas & Waqf) menu 4. October 2020 Internet Banking (CMS Corporate) a. 5. September 2020 Multi Transfer October 2020 Implementation of QRIS (Co-branding) Issuer & Acquirer September 2020 Bank NTB Syariah as the payment system service provider with the permission of the ATM/Debit Card Issuer and Acquirer following the provisions of the Card-Based Payment Instrument (Alat Pembayaran Menggunakan Kartu (APMK)) with the realization status of the implementation of NSICCS/SNTC and the National Payment Gate (GPN/NPG) is explained as follows: Informations December 2020 NSICCS ATM/Debit Card Printing and Perso 89,700 pcs NTB Syariah Bank ATM/Debit Card (active status circulating) 257,107 pcs Number of ATMs machine connected to GPN 203 unit Number of EDC machine connected to GPN 438 unit Number of EDC Pinpad machine 61 unit The data of Bank’s delivery channel service data in 2020 is as follows: No 1. 2. 3. 4. 5. 6. 257 Informations Sharia ATM/Debit Card ATM (Automatic Teller Machine) Mobile Banking Services EDC (Electronic Data Capture) Smart behavior (Branchless Banking) CMS Corporate (Internet Banking) PT Bank NTB Syariah. 2020 Annual Report Launching 17 December 2001 17 December 2001 15 December 2015 01 September 2016 31 December 2016 12 February 2018 Jumlah (December 2020) 257.107 pcs 203 unit 18.312 user 438 unit 183 agen 574 user Spirit of Amanah, Optimistic and Growth in Sustainable Business
  259. Overall the ’features of the bank’s delivery channel can be depicted in the following diagram: ATM • Balance information • Account mutation • Internal transfer • ATM Bersama transfer/Link/BCA • Purchasing (XL, Telkomsel, Indosat) & Smartfren, PLN pre-paid • Top up (Go Pay, Ovo, Link aja) • Payment (Telkom, XL, Telkomsel, Indosat, PBB Mataram, PDAM Giri Menang and Praya, Samsat NTB, Samsat Nasional, MPN G2 Tax, credit card) • ZISWAF (Baznas, Wakaf Al-Quran, Wakaf ACT, Wakaf BMH SMS BANKING • Balance information • Account mutation • Internal transfer • ATM Bersama transfer/Link/BCA • Purchasing (XL, Telkomsel, Indosat) & Smartfren, PLN pre-paid • Payment (Telkom, XL, Telkomsel, Indosat, PBB Mataram, PDAM Giri Menang and Praya, Samsat NTB, Samsat Nasional, MPN G2 Tax, credit card) • ZISWAF (Baznas, Wakaf Al-Quran, Wakaf ACT, Wakaf BMH MOBILE BANKING • Balance information • Account mutation • Internal transfer • ATM Bersama transfer • Purchasing (XL, Telkomsel, Indosat) • Top up (Go Pay, Ovo, Link aja) Payment (Telkom, XL, Telkomsel, Indosat, PBB Mataram, PDAM Giri Menang) • QRCode internal payment • ZISWAF (Baznas, Wakaf Al-Quran, Wakaf ACT, Wakaf BMH INTERNET BANKING • Balance information • Account mutation • Internal transfer • ATM Bersama transfer • Interbank transfer QRIS • Scan transaction • PPOB EDC • EDC Merchant (balance information, purchase, GVN, Void, settlement) • EDC Pinpad (balance information, PIN Changing, mobile banking registration, internal transfer, ATM bersama transfer) LAKU PANDAI • Cash withdraw BSA • Cash deposit BSA • Balance information BSA • Internal transfer BSA COVID-19 PANDEMIC CUSTOMER SERVICE Dalam masa pandemi COVID-19, layanan digital perbankan telah menjadi andalan nasabah untuk bertransaksi. Bank terus mendorong nasabah untuk mengoptimalkan penggunaan digital banking untuk memudahkan nasabah dalam bertransaksi seklaigus mengurangi keramaian di kantor cabang Bank NTB Syariah. Pentingnya penggunaan digital banking menjadi perhatian sebagian besar bank selain tetap memberikan layanan nasabah melaui outlet kantor layanan dengan penerpan langkah-langkah sesuai standar kesehatan (pemutus penularan Covid-19), antara lain: 1. Edukasi untuk penerapan standar 3 M (memakai masker, mencuci tangan dan menjaga jarak) 2. Penyiapan sarana : box spray anti covid-19, termometer suhu, alat/sarana mencuci tangan, pemasangan akrilik layanan fronliner, pembatasan antrian nasabah (berjarak), dll DEVELOPMENT OF BANK NTB SYARIAH ELECTRONIC NETWORK TRANSACTIONS IN 2020 1. Automated Teller Machine (ATM) At the end of 2020, the number of ATM machines that the Bank had reached was 203 units which were spread throughout West Nusa Tenggara. This numberincreased by 3 units compared to that in 2019. The number of cash transactions through ATM machines increased by 1,064 thousand or 28.21% compared to that in 2019. The frequency of the transactions is described as follows. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 258
  260. Business S u p p o r t Fu n c t i o n ATM 250 ATM / Unit 200 200 203 2019 2020 151 150 127 102 100 50 0 2017 2016 2018 ATM Cash Transaction Frequency 4.500 4.247 Frequences (Thousand) 4.000 3.375 3.500 2.964 3.000 2.304 2.500 2.000 1.536 1.500 1.000 500 0 2017 2016 ON US 588 396 298 289 192 2018 2020 2019 OFF US ATM Non-Cash Transaction Frequency 538 483 Frequences (Thousand) 500 395 400 300 353 267 200 100 35 33 0 259 2017 2016 ON US PT Bank NTB Syariah. 2020 Annual Report 2018 77 52 39 2019 2020 OFF US Spirit of Amanah, Optimistic and Growth in Sustainable Business
  261. 2 . Electronic Data Capture (EDC) The number of EDC machines that the Bank had in 2020 was 438 units. There was an increase of 8.68% compared to that in the previous year which was 403 units. The increase in the number of machines had an effect on the increase in the number of transactions. There was an increase of 60,715 transactions or 214.53% compared to the previous year (exactly 28,301 transactions). Rising in the number of transactions resulted in the increase amount of money transacted which was IDR 97,678 million. There was a growth of IDR 65,459 million compared to that in the previous year (IDR 32,219 million) or an intensification of 203.17%. Number of EDC 450 438 403 400 350 Unit 300 250 200 200 2017 2018 200 150 100 50 0 0 2016 2020 2019 EDC Transaction Frequency 60.000 55.281 Frequences 50.000 40,000 33.735 30.000 20.000 16.865 11.436 10.000 5.572 0 0 0 1.521 1.625 2017 2016 ON US 446 2018 2020 2019 OFF US Nominal EDC Transaction 60.386 60.000 Nominal 50.000 37.292 40,000 30.000 19.559 20.000 12.660 10.000 6.492 0 0 0 3.372 2017 2016 ON US 1.092 2.892 2018 2019 2020 OFF US Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 260
  262. Business S u p p o r t Fu n c t i o n 3 . Mobile Banking Another excellent service feature offered by Bank NTB Syariah is Mobile Banking. Throughout 2020, there were 18,312 users of banking service. It means, the number increased by 73.19% compared 10,573 users in the previous year. The number of transactions through mobile banking in 2020 reached 408,905, an increase of 105.81% compared to only 198,680 transactions in the previous year. The increase in the number of transactions resulted in the growth of transaction volume which reached IDR 414,179 million, a growth of 91.72% in 2020 as opposed to only IDR 216,036 in the previous year. MBS Users 18.312 20.000 User Accounts 15.000 10.573 10.000 5.311 5.000 2.701 2.500 1.359 1.000 0 2016 2017 2018 2019 2020 MBS Transactions Frequency 500.000 Frequencies (million) 408.905 400.000 300.000 198.680 200.000 99.984 100.000 28.220 0 2016 53.880 2017 2018 2019 2020 MBS Nominal Transaction 500.000 Nominal (million) 414.179 400.000 300.000 216.036 200.000 95.646 100.000 0 261 PT Bank NTB Syariah. 2020 Annual Report 8.856 21.850 2016 2017 2018 2019 2020 Spirit of Amanah, Optimistic and Growth in Sustainable Business
  263. 4 . SMS Banking Bank NTB Syariah SMS banking service was released in January 2020 with 1,084 million users. The number of transactions made through SMS Banking services was 8,764 where the total amount money transacted reached IDR 11,156 million. Total User 1300 1.084 User Accounts 1000 700 500 300 100 0 0 0 0 2017 2018 2019 2020 SMS Banking Transaction Frequencies 10000 8.764 Frequencies (million) 8000 6000 4000 2000 1000 0 0 0 0 2017 2018 2019 SMS Banking Nominal Transaction 12000 Nominal (million) 2020 11.156 10000 8000 6000 4000 2000 0 0 0 0 2017 2018 2019 Spirit of Amanah, Optimistic and Growth in Sustainable Business 2020 PT Bank NTB Syariah. 2020 Annual Report 262
  264. Business S u p p o r t Fu n c t i o n WORK PLANS FOR 2021 The Network , Branch Performance and Electronic Channel (JKE) Division has compiled various programs to improve customer access through the following work programs: 1. Physical offices are still very much needed to build trust and brand awareness of the public. The physical offices have other functions besides providing services. One of the functions referred to is to educate people about sharia banking education, providing that the majority of people in West Nusa Tenggara is Muslim and the province itself becomes a halal tourist destination. In the up coming year, the Bank will expand its business by opening new offices in various places in West Nusa Tenggara to reach other potential and prospective areas especially to expand the bank services. The following are several places wherein the bank planned to open its new offices, relocate (change addresses) and change status, and provide ATM networks: a. Opening Gunung Sari and Pringgabaya sub-branch offices; b. Upgrading the status of the Office (from cash office/ service office to branch office) i.e. Pagesangan and Kebon Roek sub-branch offices so that the public can be served optimally; c. Planning to change addresses of several offices (currently under renovation)i.e Pejanggik, Selong; Masbagik branch offices and Cakranegara, Tente, Manggelewa, Keruak, Plampang, Bugis Taliwang, Bolo, Alas, and Aikmel sub-branch offices; and Labuhan Lombok service office. d. Adding 52 new ATM networks. 2. E-channel Service The strategy to improve services carried out by Bank NTB Syariah is by intensifying and expanding e-channel. These strategies aim to achieve several important goals i.e.: No Products and Payment System Service Activity 1. 2. Mobile Banking Electronic Data Capture (EDC) 3. Branchless Banking 4. 5. Implementation of NSICCS/SNTC ATM & Card 263 PT Bank NTB Syariah. 2020 Annual Report a. As a manifestation of providing complete service products to customers. b. Enrichment of services to customers. c. Build customer loyalty to the Bank. d. As a source of income for the Bank, especially the fee-based income. e. Improve the Bank's competitiveness against competitors. f. Maintenance of the Bank's business existence. g. As an endeavor to differentiate Bank products and services to customers. h. To spur public interest in the Bank as its strategic partner. i. Supporting government programs in succeeding the National Non-Cash Movement (GNNT), banking financialliteracy, education and inclusion programs. j. Improving the image of the Bank by prioritizing the image of ‘the solution for the community's main financial management’. In the future, Bank NTB Syariah seeks to diversify products and provide optimal payment system service activities. This step is taken to improve service performance, provide complete transaction features and the reliable payment system service. The bank continues to strive to improve the effective and comprehensive payment system service activities through several activities deemed to provide added value to the Bank's business. To develop the payment system, Bank NTB Syariah has taken several steps, including: Description Development of QRIS feature Development of EDC Mobile Feature: a. Create PIN of ATM Cards b. Reset Pin/Password of Mobile Banking Feature Updates: a. Payments b. Purchases c. Interbank transfer Provision of Chip/SNTC-based ATM Machines Feature update: a. Issuer Only ATM Al-Rajhi Bank b. Adding Biller & Payment c. Revitalization of Regular ATM Cards Spirit of Amanah, Optimistic and Growth in Sustainable Business
  265. ADMINISTRATION , SUPERVISION AND SAVING OF FINANCE (APP) In general, definition of financing is the provision of funds or equivalent claims in the form of profit sharing, leasing; including service leasing, buying and selling, and lending and borrowing transactions based on an agreement between the Bank and other parties. The agreement obliges the party being financed and/or given the fund to return the fund after a certain period of time in exchange for ujrah (fee), without compensation, margin, or profit sharing. Distribution of Financing is the main activity of the Bank with risks that may affect the health and sustainability of the Bank's business. In distributing financing, the bank apply the prudential principles. Essentially, applying the principles also implicitly provides legal protection for customers, especially for those who deposit their money. The point is that, the Bank must be careful in distributing the funds collected from the public to secure the funds as well as to maintain and increase trust of the public in the Bank The application of the principles is generally shown through feasibility study that the bank conducted when providing financing. The feasibility study is done by analyzing the character, capital, capacity, conditions of economic and collateral. This is known as the five C 'principles. With regard to the distribution of Financing, Bank Indonesia issued conditions that every bank must carry out as an endeavor to minimize risks of the Financing distribution by implementing the prudential banking principles. These conditions include determination of the Legal Lending Limit (BMPK) and Loan Deposit Ratio (LDR). To maintain the sustainability of business, quality of Financing, and minimize the risk of loss, the Bank is obliged to always maintain the quality of its Financing by conducting financing supervision, guiding customers, and monitoring the customers regularly and continuously to detect as early as possible any obstacles or disruptions when the customers repay the bank. If the bank fails to do it, the quality of financing is threatened. Financing Quality or commonly known as Financing collectability is classified into five categories namely collectability1 (Current), collectability2 (Under Special Mention), collectability 3 (Substandard), collectability4 (Doubtful), and collectability 5 (Stuck). If there is a problem, the Bank must take a step to save and resolve it to prevent losses and the funds that have been distributed can be returned considering that the bank is responsible for managing the capital and business to make sure that the funds are safe and beneficial. Spirit of Amanah, Optimistic and Growth in Sustainable Business DUTIES AND RESPONSIBILITIES Following the Decree of the Board of Directors Number: 01.16/64/005A/2018 On October 12, 2018, Bank NTB Syariah established Administration, Monitoring and Rescue Desk (APP Desk) as the Person in Charge of Management of Financing Administration, Supervision, and Rescue of troubled Financing. In 2020, the structure of APP Division referred to SK.DIR Number: SK.01/16/64/022/2020 dated February 17, 2020 concerning the Organizational Structure and Work Procedures of PT Bank NTB Syariah. In detail, the duties and responsibilities of Desk APP are as follows: 1. Review and propose Work plan and Work Unit Budget. 2. Manage and implement Systems, Policies and Operational Standards and Procedures. 3. Monitorm, evaluate, as and report the management and settlement of collectability III, IV and V as well as Write-Off Financing. 4. Study relationship aspects between the Bank and the customer related to collectability III, IV, and V as well as write-off financing. 5. Manage collectability and evaluate the development of collectability III, IV, and V as well as write-off financing in all branches. 6. Monitor the Administration of Financing and Reports related to Write-Off Financing. 7. Give coaching to branches about Financing Administration, Financing Rescue, and Reports related to write-off Financing. 8. Monitor and direct the execution of reporting and follow-up Audit Findings. 9. Manage and build relations with BUPLN, District Courts and other related agencies in an effort to rescue and settle collectibility III, IV, and V as well as Write-Off Financing. 10. Approve and/or sign letters and/or internal documents or outgoing letters and/or documents for other parties related to the duties of the Financing Administration Desk, Rescue and Report following the authority given by the board of directors. 11. Give coaching and pay visits to all branches about rescue and settlement of collectability III, IV and V as well as write-off financing and Financing restructuring. 12. Pay visits to BUPLN, District Courts and other related institutions in terms of coordination/consultation about rescue attempts and settlement of collectibility III, IV, and V as well as Write-Off Financing. 13. Provide recommendations in terms of rescue and settlement of collectibility III, IV, and V as well as write-off financing related to law. PT Bank NTB Syariah. 2020 Annual Report 264
  266. Business S u p p o r t Fu n c t i o n ORGANIZATIONAL STRUCTURE OF ADMINISTRATION , SUPERVISION AND RESCUE FINANCING DESK Based on the Decree of the Board of Directors Number: 01/16/64/022/2020 dated February 17, 2020 concerning the Organizational Structure and Work Procedures of PT Bank NTB Syariah, the APP Desk is led by a Desk Head and is under the coordination of the Director of Finance and Operations. DIRECTOR OF FINANCE & OPERATIONS DESK HEAD Administration, Supervision, and Financing Rescue Penyelia Remedial and Finance Recovery Special Financing Monitoring Special Financing Rescue Administrative Assistant Penyelia Financing Administration Juris (Legal Financing) Analyst of Finance Reports Administrative Assistant PROFILE OF THE HEAD OF ADMINISTRATION, SUPERVISION AND RESCUE OF FINANCING Sri Wahyuni She is an Indonesian citizen, born in Bima on July 26, 1967, aged 52. She completed his undergraduate degree at the Universitas Muslim Indonesia Ujung Pandang in 1992. Started her career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to Sri Wahyuni including as the Head of the Mataram Sub-Branch, the Head of Karang Jangkong Branch, the Deputy Head of the Sumbawa Branch, the Deputy GM of Retail and Consumer Financing, and most recently as the Desk Head of Administration, Supervision, and Financing Rescue. 265 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  267. WORK PROGRAM FOR 2020 WORK PLAN FOR 2021 Based on the new organizational structure and in support of the Bank 's 2020 Business Plan, the APP Desk had defined following work plans: 1. Realizing the disbursement of Financing following the authority of the Head Office. 2. Administering realized Financing data/files as referred to in point 1. 3. Securing Financing by ensuring collateral submitted by the Customer has been binded effectively following the regulations in terms of risk mitigation. 4. Perform regular monitoring of Financing with collectibility 3, 4, and 5. 5. Coordinate with Branches/Sub-Branches in terms of invoicing customers with problematic financing 6. Coordinate with Insurance Partners regarding claim requests submitted by Branch/Sub-Branches In 2021, Bank NTB Syariah will have bigger challenges in running and advancing its business. Thus it requires the Bank to mitigate as early as possible against all risks related to the Bank’s activities, especially in terms of distribution of Financing. Therefore, to support the Bank’ Business Plan for 2021-2022, the APP Desk has prepared a work plan for 2021 as follows: 1. To properly administer Financing data/files to mitigate legal risks. 2. Maximizing financing recovery aiming to improve the quality of Non-Performing Financing (NPF) and writing-off books properly and comprehensively. 3. Regularly monitoring financing with collectibility of 3, 4, and 5 4. Coordinate with Branch/Sub-Branches regarding the handling of problematic financing and write off books. 5. Handling Non Performing Financing (NPF) and Write Off Books to achieve the 2020 target, one of which is to approach related agencies (for customers with vertical staffing). 6. Pay regular visits to customers. 7. Coordinate with Insurance Partners regarding claim requests submitted by Branches/Sub-Branches. Coordinating with the Legal Counsel or the Attorney 8. General's Office as well as the District Court regarding the simple lawsuit against collectability III, IV, V and write-off books. 9. Preparing collateral auction for non-performing financing (collectability 5 and write off books). REALIZATION IN 2020 1. 2. 3. 4. 5. Mapping Financing products before invoicing. Invoicing Customers; APP desk, along with branch offices, directly invoiced Write-Off customers and Collectability 3, 4 and 5 which consolidated result was IDR 6.6 billion and IDR 41 billion respectively. Submission of collectibility 5 customers claims to the Insurance; The APP desk and branch offices submitted and coordinated with the insurer regarding the financing claims of collectability 4 (doubtful) and 5 (stuck) and so they get a claim of IDR6.2 billion so as to improve the financing quality. Prepare and complete documents related to problem financing that would be submitted for the auction in 2020. Restructuring of Financing Affected by Covid 19: The APP desk, along with Branch Offices and Sub-Branch Offices, conducted an analysis on the relief that would be provided to customers affected by the Covid-19 pandemic during 2020 and provided installment relaxation that could help customers to sustain their business during the pandemic until the end of 2020. The APP Desk along with Branch Offices and Sub-Branch Offices restructured installment of 704 customers by providing a temporary deferral payment delay of IDR 13,816 million and a break of the margin/profit sharing of IDR 681 Million. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 266
  268. Business S u p p o r t Fu n c t i o n BUSINESS RISK The Business Risk Desk is established as a Work Unit whose function is to assist the Bank 's Business Units in mitigating risks that may arise. It is independent and able to measure risks while at the same time improve the implementation of a sound banking business following prudential principles by implementing the function of the Four Eyes Principle. This work unit is responsible for analyzing and reviewing the execution of business activities at head office such as fund management (collection and allocation), investment management, and financing distribution. The unit plays a role in ensuring the compliance of regulations, standards, policies, and procedures in the execution of daily activities. It identifies, measures, monitors, manages and reports business risks to take mitigation steps in decision making. There are many factors that affect the success of the management of business activities at the Bank i.e. the effectiveness of leadership, a well-functioning internal control structure, organizational solidarity, and management mechanisms that run well and efficiently. STRATEGIC PLANNING ORGANIZATIONAL STRUCTURE Based on the Decree of the Board of Directors number SK.01/16/64/075/2020 dated December 01, 2020 concerning the Organizational Structure and Work Procedures of PT Bank NTB Syariah. The successful management of the Bank's business activities has a very strategic meaning for the development of the Bank. The indicators include low level of non-performing financing and relatively good profit sharing for depositors and other fund owners as well as an increase in business volume mainly due to increased public trust. Meanwhile, the opposite condition will happen if the Financing activities and fund management are not managed properly and professionally. Therefore, the entire series of business activities at the Bank must be carried out properly, following applicable internal regulations and policies and external regulations. Business activities must be carried out selectively based on the results of a good analysis of various aspects, including existing risk and by adhering to the prudential principles. From time to time, risk management at the Bank must be taken care of so that the Bank's business can run according to the rules and regulations defined by the authorities. DIRECTOR OF FINANCE & OPERATIONS DESK HEAD Business Risk Business RIsk Staff Administrative Assistant PROFILE OF BUSINESS RISK DESK HEAD Adhi Susantio Indonesian citizen, born in Mataram on October 14, 1971, aged 49. He Completed his Masters degree in Marketing Management at STIE Trianandra Jakarta in 2007. He Started his career at PT Bank NTB in 2010 through a pro hire program. Several strategic positions have been entrusted to H. Adhi Susantio including as the Deputy General Manager of the SPI Division and most recently as the Desk Head of Business Risk. 267 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  269. MAIN FOCUS OF BUSINESS RISK 2020 To support the achievement of Bank NTB Syariah business in 2020 so that the business runs well and therefore can support healthy and sustainable business growth , the business risk function is focused on main activities that support each other and are related, namely: 1. Provide a review of the analysis results and risk mitigation on the implementation of business activities including retail fund development and bank services, financing distribution, management/control of bank liquidity, management of bank fund allocation, and support other bank business activities; 2. Providing analysis and input according to the request of the related business unit by mitigating risks that may arise and measuring risks following the prudential principles, monitoring at any time if necessary aiming to minimize the risk of financing and other businesses involved that result in fraud both by customers and bank internals; 3. Monitoring the quality of financing, financing portfolios, and other activities related to the Business Risk Desk; 4. Be independent based on the comparative value information obtained in conducting each collateral appraisal/assessment process. REALIZATION OF WORK IN 2020 The work achievements of the Business Risk Desk in 2020 include: 1. Develop and improve policies related to the Business Risk Desk work flow; 2. Carry out the appraisal process and the assessed value of collateral in NAP in the process of proposing a financing application following the applicable conditions with a fair collateral value; 3. Carry out a review process of fund management activities, distribution of investment management financing, and cooperate in the form of assets, according to the request of the related work unit 4. Financing monitoring that was given according to the authority and ensure financing quality 5. Strengthening the organization and SDI at the Business Risk Desk. WORK PROGRAM IN 2021 In the beginning of 2021, Bank NTB Syariah has set a priority strategy in realizing business growth through the bank’s policies as the following; 1. Reviewing the implementation of bank business activities such as fund management activities, distribution of investment management financing, and cooperate in the form of assets, according to the request of the relevant work unit; 2. Ensure the compliance of policies and procedures of business risks (financing risk, market risk, operational risk, return risk and investment risk) following the applicable regulations and take mitigation steps in making decisions; 3. Ensuring the sustainability of the bank's business and the achieved bank performance based on the set targets; 4. Ensuring that the appraisal process and the estimated value of collateral in the NAP in the proposed financing application process are following the applicable conditions with a reasonable collateral value; 5. The establishment of an SDI Business Risk Desk that is competent in terms of guarantee and risk mitigation appraisal techniques. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 268
  270. GOOD CORPORATE GOVERNANCE Governance Framework 272 Legal Basis for GCG Implementation 273 GCG Principles 273 Company Values 274 Corporate Governance Organ Structure 275 Governance Soft Structure 276 Controlling Shareholders and Major 277 Shareholders General Meeting of Shareholders (GMS) 277 Sharia Supervisory Board 281 Board of Commissioners 293 Board of Directors 306 Organs and Committees Under the Board of Commissioners: 317 Organs and Committees Under the Board of Directors: 331 Internal Audit Unit 346 Public Accountant 351 Risk management 352 Internal Control System 363 Compliance Function 363 Application of Anti-Money Laundering and Prevention of 368 Terrorist Funding Transparency of Financial and 370 Non-Financial Conditions Provision of Funds for Social and/or Political Activities 370 Law Cases Access to Company Data Information 371 Code of Ethics 372 Gratification Policy 373 Whistleblowing System 374 Handling of Conflicts of Interest 374 Non-Halal Income and Its Usage 378 Maximum Limit of Fund Distribution 378 Buyback Share and Buyback 379 Obligations 380 Assessment of Good Corporate Governance in 2020 380
  271. 06
  272. Good Corporate G ove r n a n c e Bank NTB Syariah is an Islamic Commercial Bank functioned as an intermediary institution that plays a role in collecting funds from the public in the form of savings to provide loans to the community that needs financial support with the purpose of establishing the regional economic growth in particular. To accomplish that target, Bank NTB Syariah highly upholds the principles of good corporate governance (GCG) and understands how important the implementation of those principles are in every business decision made for the benefit of stakeholders. 271 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  273. GOVERNANCE FRAMEWORK As an intermediary institution that collects public funds in terms of deposits or savings and distributes them to the community that needs to reslove their financial issue, Bank NTB Syariah is comfirmed to be a significant factor in driving community economic growth. Therefore, Bank NTB Syariah applies the principles of Good Corporate Governance (GCG) that include Transparency, Accountability, Responsibility, Independence and Fairness in its business implementation. Bank NTB Syariah's commitment to implement the GCG principles can be seen from its determination to make some improvements on the structure and process of applying GCG in a sustainable manner. Bank NTB Syariah believes that the business which is carried out with excellent GCG implementation will make it more possible to remain durable and sustainable in the long term. In 2020, Bank NTB Syariah accomplished activities based on the GCG implementation framework which refered to 5 (five) main principles: 5 main principles of GCG implementation framework Foundation: Structure & Infrastructure Update & Maintenance GCG Sounding Process Assessment GCG IMPLEMENTATION FRAMEWORK 1. 2. 3. 4. 5. Forming Organizational Structure and Policies that support the implementation of GCG. Updating Organizational Structure and Policies based on Regulations and Benchmarks. Disseminating GCG and Internal GCG Policy to all Bank NTB Syariah employees to create awareness. Carrying out every business activity referring to GCG internal principles and policies. Assessing the implementation of the principles in the Company by self-assessment and the assessment of independent institutions. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 272
  274. Good Corporate G ove r n a n c e LEGAL BASIS OF GCG APPLICATION The application of GCG in Bank NTB Syariah has a legal basis that includes the following laws , regulations, and guidelines: 1. Act Number 7 of 1992 as amended by Act Number 10 of 1998 concerning Banking. 2. Law Number 40 of 2007 concerning Limited Liability Companies. 3. Law Number 21 of 2008 concerning Sharia Banking. 4. Financial Services Authority Regulation Number: 55/POJK.03/2016 concerning the Implementation of Governance for Commercial 5. Banks. Bank Indonesia Regulation Number: 11/33/PBI/2009 concerning Implementation of Good Corporate Governance for Sharia 6. Commercial Banks and Sharia Business Units. Financial Services Authority Regulation Number: 8/POJK.03/2014 concerning Rating of Soundness of Sharia Commercial Banks and 7. Sharia Business Units. Bank Indonesia Circular Letter Number: 12/13/DPbS dated April 30, 2010, concerning Implementation of Good Corporate 8. Governance for Sharia Commercial Banks and Sharia Business Units. Circular of Financial Services Authority (OJK) Number: 10/SEOJK.03/2014 concerning Rating of Soundness of Sharia Commercial GCG PRINCIPLES Implementation of GCG in Bank NTB Syariah, namely by applying 5 (five) GCG principles that are well known, namely Transparency, Accountability, Responsibility, Professional (Independent) and Fairness, in every activity the Bank's business so that GCG can be implemented well. Besides, Bank NTB Syariah considers GCG principles to be in line with sharia principles. The definitions related to the GCG principles are as follows: Transparency Transparency is openness in presenting material and relevant information and openness in the decision-making process. This principle is needed so that Sharia Bank business activities run objectively, professionally and to protect stakeholder interests. Transparency contains elements of disclosure and the provision of information in a timely, adequate, clear, accurate and comparable manner and is easily accessible to stakeholders and the public. In applying the principle of transparency, Islamic banks must provide material and relevant information in a way that is easily accessible and understood by stakeholders. Islamic Sharia banks must also take the initiative to disclose not only the problems required by legislation but also the things that are important for decision making by the Shareholders, Customers and other stakeholders. Accountability Accountability is the clarity of the functions and implementation of the accountability of bank organs so that their management runs effectively. Accountability contains an element of clarity of functions within the organization and how to account for them. Accountability is a prerequisite needed to achieve a sustainable performance of the Islamic Sharia bank business. In applying the principle of accountability, Sharia banks as institutions and officials who have authority must be able to responsible for their performance in a transparent and accountable manner. For this reason, Sharia banks must be managed in a healthy, measured and professional manner by taking into account the interests of shareholders, customers, and other stakeholders. 273 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  275. Responsibility Responsibility is the suitability of bank management with the applicable laws and regulations and the principles of sound bank management . The principle of responsibility or accountability is needed in Islamic Sharia banks to guarantee the long-term sustainability of bank business. In applying the principle of responsibility, Sharia banks must comply with applicable laws and regulations and internal bank requirements and carry out responsibilities to the community and the environment so that businesses can be sustained in the long run and be recognized as good corporate citizens. Sharia banks must also adhere to the principle of prudence (prudent). Professional (Independent) Professional that is competent, able to act objectively and free from influence or pressure from any party (independent) and has a high commitment to develop Islamic Sharia banks. To expedite the implementation of GCG principles, companies must be independently managed so that each organ of the company does not dominate each other and cannot be intervened by other parties. Professionals contain an element of independence from the domination of other parties and apply objectively in carrying out their duties and obligations. In connection with the application of professional principles, Islamic Sharia banks must be managed independently so that each organ of the company and all its subordinates must not dominate each other and cannot be intervened by any party that can influence objectivity and professionalism in carrying out their duties and responsibilities. Fairness Fairness is justice and equality in fulfilling stakeholder rights based on agreements and applicable laws and regulations. Sharia banks must always pay attention to the interests of shareholders and other stakeholders based on the principle of fairness and equality. Fairness contains the element of fair treatment and equal opportunity following the proportions. In carrying out its activities, Sharia banks must always pay attention to the interests of shareholders, customers and other stakeholders based on the principle of fairness and equality of each party concerned. COMPANY VALUES The main principles of GCG has been pictured into the vision, mission, 4 cultural values and 10 principal behaviors of Bank NTB Syariah aimed to accomplish homogeny, unity of language, common views and unity of operational performance; as well as to ensure that all levels of Bank NTB Syariah will be oriented to GCG in carrying out their daily work. Vision Becoming a Sharia Commercial Bank that is trustworthy, reputable, and community choice. Mission 1. Providing excellent services and providing innovative Islamic banking products according to customer needs; 2. Developing professional and prosperous Human Resources through the implementation of a consistent performance-based system; 3. Broadening the scope of services for access and transactions through the application of reliable technology; 4. Giving maximum contribution to shareholders and enhance the role of social care; 5. Encouraging regional economic growth. Spirit of Amanah, Optimistic and Growth in Sustainable Business 4 Cultural Values 1. Carrying Out and Maintaining Trusts and Sharia Ethics 2. Having Integrities and Work Ethics 3. Making continuous improvements 4. Implementing Synergies in Achieving Goals 10 Main Behaviours 1. Honest and sincere 2. Courteous and Friendly 3. Competent and Responsible 4. Discipline and Consistency 5. Tough and Dedicated 6. Creative and Innovative 7. Continuously Learning and Developing 8. Empathy and proactive 9. Productive and Dynamic 10. Harmonious and Respect for Diversity PT Bank NTB Syariah. 2020 Annual Report 274
  276. Good Corporate G ove r n a n c e CORPORATE GOVERNANCE ORGAN STRUCTURES The implementation of GCG at Bank NTB Syariah is based on a cooperative devotion of all levels of management and employees to comply the applicable laws and regulations . As it is in line with the GCG implementation regulations, Bank NTB Syariah had a Corporate Governance structure refers to the Law No. 40 of 2007 concerning Limited Liability Companies and The Regulation of Bank Indonesia No: 11/33/PBI/2009 concerning the Implementation of Good Corporate Governance for Islamic Commercial Banks and Business Units. GMS Board of Commisioners Board of Sharia Supervisory Directors Commitee Commitee Audit Commitee Corporate Secretary 1. Risk Management Commitee 2. Human Resources Commitee 3. Asset Liability Management (ALMA) Commitee 4. Information Technology Director Commitee 5. Financing Commitee Main Organs General Meeting of Shareholders (GMS) Board of Commissioners Directors Sharia Supervisory Board (DPS) 275 PT Bank NTB Syariah. 2020 Annual Report CSR Internal Audit Unit Risk Monitoring Commitee Remuneration & Nomination Commitee Compliance Risk Management Treasury Human Resources Strategic Planning IT System Committees Under the Board of Commissioners Audit Committee Risk Monitoring Committee Remuneration and Nomination Committee Committees Under the Directors Risk Management Committee Human Resources Committee Asset Liability Management (ALMA) Committee Information Technology Steering Committee Financing Committee Supporting Organs • Corporate Secretary Desk • SPI Division • Compliance Division • Treasury Division • Strategic Planning Division • Human Resources Division • Information Technology Division Spirit of Amanah, Optimistic and Growth in Sustainable Business
  277. GOVERNANCE SOFT STRUCTURE To implement GCG , Bank NTB Syariah operated all its functions and duties according to various policies/guidelines with the following objectives: 1. Completing the supporting policies; 2. Carrying out daily activities in accordance with the expected corporate culture; 3. Creating written commitment to all level of bank’s organization to improve discipline and responsibility of corporate organs in order to provide the benefits of stakeholders in accordance with their respective responsibilities. The policies that had been acknowledged by Bank NTB Syariah for the period 2020 include: 1. Articles of Assossiation of Bank NTB Syariah Deed No. 5 dated on August 21st, 2018 concerning Amendemnet to the Articles of Assossiation of Bank Syariah NTB. 2. Guidelines and Work Rules Of Board of Commisioners Decree of Board of Commisioners of Bank NTB Syariah No: 055/DK-SK/I/08/2020 concerning Guidelines and Work Rules Of Board of Commisioners of Bank NTB Syariah. 3. 4. 5. 6. Guidelines and Work Rules Of Directors Decree of Directors No: SK.01/22/64/052A/2020 dated on August 3rd, 2020 concerning Guidelines and Work Rules Of Directors of PT. Bank NTB Syariah. Guidelines of Corporate Governance Decree of Directors of Bank NTB Syariah No: SK/01/11/64/012B/2018 dated on 19th November, 2018 regarding Good Corporate Governance Company Guidelines. Guidelines of Compliance Decree of Directors of Bank NTB Syariah No: SK/01/11/64/012D/2018 dated on 19th November, 2018 concerning Compliance Company Manual. Guidelines of Management Risk Decree of Directors of Bank NTB Syariah No: SK/01/11/64/012E/2018 dated on 19th November, 2018 concerning Risk Management Company Guidelines. Spirit of Amanah, Optimistic and Growth in Sustainable Business 7. Guidelines of AML – CFT Application Decree of Directors of Bank NTB Syariah No: SK.01/11/64/038/2020 dated on 20 May 2020 regarding Company Guidelines for the Programs Implementation of the Anti-Money Laundering and Combating the Funding of Terrorism of PT Bank NTB Syariah. 8. Internal Audit Charter Decree of Directors of Bank NTB Syariah No: SK/01/11/64/012H/2018 dated on 19th November, 2018 concerning Internal Control Unit Company Manual Book. 9. Guildelines of Business Ethics and Code of Conduct Decree of Directors of Bank NTB Syariah No: SK/01/11/64/012B/2018 dated oNovember 19th, 2018 concerning Good Corporate Governance Guidelines. 10. Guidelines of Anti-Fraud Strategy Decree of Directors of PT Bank NTB Syariah No: SK.01/14/64/025/2020 dated on March 5th, 2020 concerning Implementation of Anti-Fraud Strategy of PT Bank NTB Syariah. 11. Guidelines of Conflict of Interests Decree of Directors of PT Bank NTB No: SK/01/11/64/014g/2018 dated on 7th June 2018 concerning Guidelines for Handling Conflicts of Interest of PT Bank NTB Syariah. PT Bank NTB Syariah. 2020 Annual Report 276
  278. Good Corporate G ove r n a n c e CONTROLLING SHAREHOLDERS AND MAIN SHAREHOLDERS Bank NTB Syariah is a Regional Owned Enterprise related to banking sector that the majority of share is owned by all Regional Governments . The share is consisted of the composition of paid-up capital by the NTB Provincial Government per December 31st , 2020 as much as IDR 334,216 million or 43.13% and of a total paid-up capital by the Regency Government/ Cities in NTB per December 31st, 2020 making to IDR 774,899 million. The composition of each Regional Government is illustrated as follows: (dalam jutaan rupiah) No I. II. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Description NTB Province Regency/City Sumbawa Regency East Lombok Regency Dompu Regency Central Lombok Regency West Sumbawa Regency West Lombok Regency Bima Regency North Lombok Regency Mataram City Bima City Total Realization 2020 2019 Share (%) 334.216 334.216 43,13% 74.650 75.231 57.968 60.000 39.643 26.087 37.918 32.022 27.097 10.068 74.650 75.231 57.968 60.000 39.643 26.087 37.918 32.022 27.097 10.068 9,63% 9,71% 7,48% 7,74% 5,12% 3,37% 4,89% 4,13% 3,50% 1,30% 774.900 774.900 100% GENERAL MEETING OF SHAREHOLDERS (GMS) The General Meeting of Shareholders (GMS) is the highest organ in the corporate that has exclusive authority granted not to the Board of Directors and the Board of Commissioners in accordance with the articles of association and the prevailing laws and regulations. The GMS forum is a very important medium where shareholders have the main authority to obtain information about the corporate, both from the Board of Directors and the Board of Commissioners. This information is the basis for the GMS to select policies in formulating the corporate's strategic, general steps in making decisions as a legal entity. The GMS is also a forum to evaluate the corporate’s performance in all operational aspects including social and environmental activities. The authority of the GMS includes amending the articles of association of the corporate, appointing and dismissing members of the Board of Directors and of the Board of Commissioners, ratifying financial reports, changing the amount of authorized capital, issued and paid-up capital and the like. The Board of Directors is obliged to hold a GMS as a medium of accountability of the corporate management for a year. In accordance with the provisions of Article 78 Paragraph (1) of Law No. 40 of 2007 on Limited Liability Companies and Article 9 paragraph (1) of the Company's Articles of Association, the GMS consists of: 1. The Annual GMS must be held every year. To execute it, the law stipulates a time limit of no longer than 6 (six) months after the end of the accounting period. In accordance with the provisions of Article 9 paragraph (3) of the Articles of Association of Corporate, the Board of Directors at the Annual GMS conveys the following matters: a. Annual Report that has been reviewed by the Board of Commissioners to get approval from the General Meeting of Shareholders and the Financial Report and to get verivication from the GMS; b. Proposing the use of profit if a positive retained earnings is available; c. Approving the establishment of a Public Accounting Office based on the recommendation of the Board of Commissioners; d. Other matters requiring the approval of the GMS for the benefit of the corporate by observing the applicable prevailing laws and regulations and the articles of association. 277 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  279. 2 . The Extraordinary General Meeting of Shareholders (RUPS-LB) as it is mentioned in a articles of association of corporate may be performed at any time based on the need and interest to discuss and decide on the agenda of the meeting apart from the agenda of annual meeting which covers annual reports, financial reports and the use of profits. The General Meeting of Shareholders refers to the prevailing laws and regulations such as Law No. 40 of 2007 concerning Limited Liability Companies and the Company's Articles of Association. REGULATORY REFERENCES The implementation of the GMS as a medium for accountability of the management for one year had been executed according to Law No. 40 of 2007 concerning Limited Liability Companies and the Articles of Association of Bank NTB Syariah, along with its amendments. IMPLEMENTATIONS OF THE ANNUAL GMS IN 2020 During 2020, Bank NTB Syariah had conducted two general meetings that consisted of RUPS-LB and Annual RUPS with further features as follows: 1. The Extraordinary General Meeting of Shareholders (EGMS-LB), organized in a circular manner which was signed by the Shareholders on 11th February 2020. DECISIONS OF THE 2020 EXTRAORDINARY GMS Agenda No Decision 1. Assigning the Director of Financing of Bank NTB Syariah To approve and determine Muhammad Usman as Director of Financing with a 4 (four) year tenure, as of the effective date of the last date signing of this shareholder decree. 2. Revoking one of the decrees of the Annual General Meeting of Shareholders of Accounting Period 2018 To accept the revocation of annual GMS of accounting period 2018 Point 9 Number 1 based on the results of the Fit and Proper test of Ir. H. Rosiady H. Sayuti, M.Sc, Ph.D that refered to Decree of Member of the Board of Commissioners of the Financial Services Authority No. KEP-5/D.03/2020 dated on7th January 2020. 3. Depositing capital of shareholders of Bank NTB Syariah To accept the determination of capital deposit of regional government during 2019 which had been recorded by the bank as capital deposit fund of Rp. 17.250.160.000,-, that had not been registered at the Ministy of Law and Human Rights of Republic Indonesia; to grant an authority to Director in handling the matters to the Ministry of Law and Human Rights. 2. The Annual GMS of Accounting Period of 2019 was held on a limited basis and via zoom scheduled on: Day/date : Wednesday, 22nd April 2020 Time : 10.00 – 12.00 Venue : The Main Meeting Room of the NTB Governor's Office Each Shareholder’s Office Daftar Hadir No Name Position Detail 1. Dr. Zulkieflimansyah, S.E., M. Sc Governor of NTB/Pemprov NTB Present 2. H.M Husni Djibril, B.Sc Regent of Sumbawa/Government of Sumbawa Present 3. H. Rumaksi SJ, SH Authorized Regent of East Lombok/Government of East Lombok Present 4. H. Agus Bukhari, SH, M.Si Regent of Dompu/ Government of Dompu Present 5. H. M. Nursiah Authorized Regent of Central Lombok/ Government of Central Lombok Present 6. Dr. Ir. W. Musyafirin, MM. Regent of West Sumbawa / Government of West Sumbawa Present 7. Drs. H. Dahlan M. Noer Regent of Bima / Government of Bima Present 8. Sarifudin, SH, MH Regent of North Lombok / Government of North Lombok Present Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 278
  280. Good Corporate G ove r n a n c e No name Position Detail 9 . Hj. Sumiatun Authorized Regent West Lombok /Government of West Lombok Present 10. H. Mohan Roliskana, S.Sos, MH Authorized Mayor of Mataram/City Administration of Mataram Present 11. Feri Sofiyan, SH Authorized Mayor of Bima/City Administration of Bima Present 12. H. Zainal Fanani President Commissioner Present 13. H. Muslihun Independent Commissioner Present 14. H. Muhammad Nur Commissioner Present 15. H. Kukuh Rahadjo President Director Present 16. H. Saharuddin Directur of Funds and Services Present 17. H. Ferry Satrio Director Compliance and Risk Management Present 18. Hj. Baiq Dien Rosana Juwita Director of Finance and Operation Present 19. Abdullah Notary Present THE ANNUAL GMS IN 2020 (YEAR BOOK 2019) No Agenda 1. Annual Report of the Board of Directors & Supervision Report of the Board of Commissioners on the Accounting Period 2019 Approving and certifing the accountability report of PT. Bank NTB Syariah accounting period 2019 that includes balance sheet, profit and loss statement and core capital per 31st December 2019 as follows: - Total Assets/Liabilities reached to IDR 8,640,304,811,278 - Profit after tax reached to IDR 163,249,445,263 - Core capital reached to IDR 1,400,358,647,654, 2. Agreement of Annual Report of 2019 Agreeing to the Corporate Annual Report and the Supervision Report of the Board of Commissioners on 31th December 2019; to release or discharge from an obligation (acquit et de charnge) of all members of the Board of Directors and Commissioners in accounting period of 2019. All members were discharged from their obligation at the end of 2019. 3. Approval for the Use of the Corporate's Net Profits of 2019 Agreeing to make use of the Net Profit for the last accounting period on 31st December 2018 as much as IDR 184.849.445.263,- with details: - For dividends of 60% of sharing profits; - General reserves of 23.32% of sharing profits; - Pension and THT funds of 5% of sharing profits; - Management Production Services of 1.26% of sharing profits; - Employee Production Services of 10.42% of sharing profits; 4. The Appointment of a Public Accountant Firm Agreeing to appoint the Public Accounting Firm of the local area to audit the Financial Statements of Accounting Period of 2020 ended on 31st December 2020 in accordance with the processes and procedures of procuring goods and services in PT Bank NTB Syariah. 5. The Amendments of Official Vehicle Procurement (Car Ownership Program) Approving the amendemnets of official vehicle procurement with Car Ownership Program (COP), in a 4 year period. The maintenance costs, vehicle registration taxes and insurance will be charged to the employer and the fee of official vehicle will be paid in full by the employer if any difference with the book value appears at the end of the term of office. 6. The Confirmation of Equity Participation - Agreeing to the determination of the capital deposit of the Regency/City Government during 2018 which had been recorded in amount of IDR 15,100,000,000, -, which had not been registered at the Ministry of Law and Human Rights of the Republic of Indonesia. - Agreeing to give an authority to the board of directors to settle the matter with the Ministry of Law and Human Rights of the Republic of Indonesia. 279 PT Bank NTB Syariah. 2020 Annual Report Decision Spirit of Amanah, Optimistic and Growth in Sustainable Business
  281. No Agenda Keputusan 6 . The Use of Reserves Approving the use of reserves to complete the allowance for impairment losses (CKPN) as an anticipation of the implementation of the provisions of the Statement of Financial Accounting Standards PSAK 113 which will become offical in early 2021. 7. The Determination of Bank Core Capital Fulfillment Policy Approving and entrusting the Shareholders/Local Government to comply the Bank's Minimum Core Capital requirement of IDR 3 Trillion no later than 31st December 2024. The Reaffirmation of Shareholder Decisions Agreeing to the reaffirmation of the Shareholders' Decision which was signed last by the Shareholders of PT Bank NTB Syariah on 11th February 2020 referring to the effective date of Mr. Muhamad Usman to carry out his duties, functions and authorities as Director of Financing of PT Bank NTB Syariah starting 9th March 2020. The Change of Members of the Sharia Supervisory Board Approving some changes in the Sharia Supervisory Board Members: a. To honorably dismiss TGH. Hudatullah Muhibuddin Abdul Aziz as of at the end of the GMS. b. To accept TGH. Maliki Sami'un as a Prospective Member of the Sharia Supervisory Board of PT Bank NTB Syariah, to be administered according to the provisions and submitted to the Financial Services Authority (OJK). Dismissal of the Board of Directors Members with Respect Assigning dismissal with respect to: a. Mr. H. Ferry Satrio as Director of Compliance & Risk Management b. Mr. H. Saharuddin as Director of Funds & Services As of at the end of the GMS. The Transformation Management Accepting the proposed Transformation of Management of PT Bank NTB Syariah. Henceforth, the names of candidates were submitted to the Financial Services Authority (OJK) to take the Fit and Proper Test (PKK) include: a. Candidates of the Board of Commissioners: 1) Drs. H. Muhammad Nasihuddin Badri, M.AP, a candidate for Non Independent Commissioner 2) Dr. Arief Budi Witarto, B.Eng, M.Eng, a candidate for Non Independent Commissioner 3) Andy Tirta, MSc, PhD, a candidate for Independent Commissioner The General Meeting of Shareholders (GMS) determined respectively one candidate for Member of Non-Independent Commissioner and Independent Commissioner that was approved by the Financial Services Authority. b. Candidates of the Board of Directors: 1) Director of Funds and Services: a) H. M. Taufiq Gozi b) H. Nurul Hadi The General Meeting of Shareholders determined one Director Candidate approved by the Financial Services Authority. 2) Director of Compliance and Risk Management: a) Hari Hartanto Edi Asmara b) Ika Ranti Hidayah The General Meeting of Shareholders determined one Director Candidate approved by the Financial Services Authority. 8. 9. 10. 11. of Bank 12. All decisions of the Annual General Meeting of Shareholders are stated in Deed Np. 2 dated on 22nd April 2020 acknowledged before a notary, Abdullah, SH. in Mataram and have been reported to the Shareholders Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 280
  282. Good Corporate G ove r n a n c e SHARIA SUPERVISORY BOARDS (DPS) The Sharia Supervisory Board (DPS) as an independent body is appointed and ratified at the General Meeting of Shareholders (GMS) and recommended by the National Sharia Council Indonesian Ulama Council (DSN-MUI) which is placed in a Sharia Financial Institution (LKS). DPS has a duty to supervise the products and services offered and the LKS operational activities performed accordingly sharia provisions. SSB must also ensure that the implementation of the Fatwa (Islamic legal pronouncement) of the National Sharia Council in Islamic Financial Institutions goes well. GUIDELINES AND RULES FOR THE SHARIA SUPERVISORY BOARD In carrying out supervisory duties, the Sharia Supervisory Board collaborates with the Compliance Unit and Internal Audit Unit to ensure the Bank's compliance in implementing sharia principles. In brief, the Sharia Supervisory Board (DPS) carries out its duties and responsibilities based on the principles of GCG; consults; provides advice to the Board of Directors and divisions related to the Bank activities to agree with sharia principles. 1. 2. 3. 4. 5. 6. 7. LEGAL BASIS COMPOSITIONS OF THE SHARIA SUPERVISORY BOARD The establishment of the Board of Commissioners of Bank NTB Syariah is based on several provisions, including: 1. Law Number 40 of 2007 concerning Limited Liability Companies; 2. Act Number 21 of 2008 concerning Sharia Banking; Bank Indonesia Regulation Number 11/33/PBI/2009 3. Concerning GCG Implementation for Sharia Commercial Banks and Sharia Business Units; National Sharia Council Recommendation Number: 4. U-285/DSN-MUI/IV/2-18; and Resolution of the General Meeting of Shareholders of 5. PT Bank NTB Syariah as outlined in the Deed of Amendment to the Articles of Association of PT Bank NTB Syariah Number 5 dated August 21, 2018 LEGAL BASIS OF APPOINTMENT Appointed as Chairman of the Sharia Supervisory Board of Bank NTB Syariah based on the Decision of the Extraordinary General Meeting of Shareholders (EGMS) of PT Bank NTB Syariah dated on 21st August 2018 which had been stated in the Deed of Amendment to the Articles of Association of PT Bank NTB Syariah No. 5 dated on 21st August 2018 and the Recommendation of DSN-MUI No: U-285 / DSN-MUI / IV / 2-18. TERM OF OFFICE From the Extraordinary General Meeting of Shareholders (EGMS) dated 04 September 2018 to 04 September 2022. 281 PT Bank NTB Syariah. 2020 Annual Report The DPS Bank NTB Syariah has the Sharia Supervisory Board's Code of Conduct based on the provisions stipulated by the Sharia Supervisory Board on October 1, 2018. The Sharia Supervisory Board Guidelines contain a compilation of regulatory principles that apply to Bank NTB Syariah and best practices good bank governance. The contents of the Sharia Supervisory Board Work Procedures include, among others, the following matters: Organization Duties and Responsibilities of the Sharia Supervisory Board Decision Making Process Transparency/Openness Work Ethics Access to Information Others Based on the Regulation of Bank Indonesia Regulation No: 11/33/PBI/2009 regarding the implementation of Good Corporate Governance in Islamic Commercial Banks and Business Units; and the Circular Letter of Bank Indonesia No: 12/13/DPbS dated on 30th April 2010 concerning the implementation of Good Corporate Governance in Islamic Commercial Banks and Business Units, the agreement of Sharia Supevisory Board of Bank NTB Syariah until 31st December 2020 includes: Name and Title H. Rubai Ahmad Munawar, Lc., M.Si (Chairman) Term of Office GMS Approval Period E-GMS August 21, 2018 September 5, 2018 September 4, 2022 CRITERIA AND REQUIREMENTS FOR SHARIA SUPERVISORY BOARD MEMBERS ollowing PBI Number: 11/33/PBI/2009 Concerning the Implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units explains that the duties and responsibilities of the Sharia Supervisory Board are to provide advice and advice to the Directors and supervise the activities of the Bank to comply with sharia principles. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  283. Therefore , the criteria and requirements of the Sharia Supervisory Board in Sharia Financial Institutions, apart from recommendation of DSN-MUI and the approval of the Financial Services Authority (OJK), involve: 1. Integrity, including good character and morals; 2. Committed to obey the Islamic banking regulations and the other applicable laws and regulations; 3. Dedicated to the sustainable development of bank. No fail category regarding the fit and proper test stipulated by the OJK; 4. Competency, required to, at least, have a knowledge and experience in the field of muamalah sharia and knowledge in banking or finance in general; 5. Financial reputation, at least not included in the list of bad debts and bankrupt or a shareholder found guilty of causing a company to go bankrupt within the last five years before nominated; 6. Declared to have passed the exam of the National Sharia Board Certification Institute (DSN-MUI). APPOINTMENTS OF SHARIA SUPERVISORY BOARD The employment of the Sharia Supervisory Board had passed the fit and proper test in accordance with the applicable laws and regulations and the provisions of Good Corporate Governance. All members of the Sharia Supervisory Board have good integrity, competence and reputation. WORK ETHICS OF SHARIA SUPERVISORY BOARD 1. 2. 3. Members are prohibited from taking advantage of the Bank for personal, family, and / or other parties' matters that reduce assets or bank profits; Members are prohibited from taking and/or receiving personal benefits from the Bank, other than remuneration and facilities stipulated in the General Meeting of Shareholders; Members are prohibited from holding concurrent positions as consultants in all Islamic Commercial Banks and / or Business Units. DUTIES AND RESPONSIBILITIES OF THE SHARIA SUPERVISORY BOARD In accordance with the Regulation of Bank Indonesia No: 11/33/PBI/2009 concerning the Implementation of Good Corporate Governance in Islamic Commercial Banks and Business Units, particularly in Article 27, the Board sets Duties, Authorities and Responsibilities as follows: Duties and Responsibilities Function Coordination 1. 2. Oversee and ensure the suitability of bank operations for the fatwa issued by DSN-MUI; Promoting Islamic economics and promoting community economy Mechanism 1. 2. 3. 4. Supervision 1. Assess and ensure compliance with sharia aspects of operational guidelines, and products issued by banks; Meminta fatwa kepada Dewan Spirit of Amanah, Optimistic and Growth in Sustainable Business 1. Conduct regular training in all Branches of Bank NTB Syariah Open a consultation room for issues that are not yet/unclear with management and work units at any time needed. Conduct an exit meeting after the inspection of sharia aspects to evaluate the results of work in all branch offices of PT Bank NTB Syariah. Promoting Islamic economics and promoting community economy, by: a. To socialize the economy and business of Islamic finance in the middle of the meeting of the Taklim Council. b. To socialize the Islamic financial economy and business among academics and students. c. To socialize Islamic financial economy and business in the middle of meetings and organizational meetings Analyze reports conveyed by and/or requested from the unit of work to find out the quality of the fulfillment of Sharia Principles on distribution and fundraising activities and services of the Bank. PT Bank NTB Syariah. 2020 Annual Report 282
  284. Good Corporate G ove r n a n c e Fungsi Supervision Tugas dan Tanggung Jawab 2 . Request a fatwa from the National Sharia Council Indonesian Ulama Council (DSN-MUI) for new bank products that do not yet have a fatwa 3. Conduct periodic reviews of the fulfillment of sharia principles on the mechanism of raising funds and channeling funds and bank services; 4. Request removal of data and information related to aspects of sharia bank working unit to implement the task of DPS; 5. Open a consultation room for issues that are not yet/ unclear with management and work units at any time needed Mekanisme 2. 3. 4. 5. 6. 7. Report 283 1. Providing opinions on sharia aspects of the overall implementation of bank operations in bank publication reports; Submit reports on the 2. results of supervision every 6 (six) months to the Directors, Commissioners, National Sharia Board and the Financial Services Authority; PT Bank NTB Syariah. 2020 Annual Report Determine the number of test samples of transactions that will be inspected each 10 (ten) files for each type of financing every month at the Branch Office and 5 (five) files for each Supporting Branch Office each month by paying attention the quality of implementing Sharia Principles in each transaction activity. Before entering the First Semester and Second Semester every year, the Sharia Supervisory Board of Bank NTB Syariah holds an internal meeting to determine the entire branch office to be tested. Checking the transaction document tested for quotation to find out the fulfillment of Sharia Principles as required in the applicable internal provisions of the Bank. The focus of the examination of DPS Bank NTB Syariah is to fulfill aspects /sharia compliance, including: a. Compliance of the contract used; b. Of the elements of the contract in a financing scheme; c. Examination of Financing Application Approval Letters (SP4 and SKP), Financing Analytical Notes (NAP), Deed and Notarial Deed; Conduct inspections, observations, requests for information and/or confirmations to Bank employees and/or customers to strengthen the results of document checks; Reviewing the applicable internal provisions related to sharia aspects if there are indications of non- compliance with the implementation of Sharia Principles; Providing sharia opinions on fundraising activities and channeling of funds and bank services.DPS Sharia Opinion specifically for this matter has become a requirement that must be fulfilled by NTB Syariah banks in the framework of fulfilling the requirements of the NTB Syariah Bank's annual financial statement audit process. Report the results of supervision by the Sharia Supervisory Board to the Board of Directors, Board of Commissioners, and the Financial Services Authority. This report contains documentation of SSB activities that are compiled as follows: 1. The results of supervision of the Bank's product development included objectives, characteristics, contract in products, compliance with sharia principles and DSN-MUI Fatwas, review of systems and procedures for product distribution. 2. The results of supervision of the Bank's activities included raising funds, channeling funds, and providing services. The form of supervision was determination and examination of the number of sampling transactions, reviewing the Standard Operational Procedure (SOP) related to aspects of Sharia. 3. Opinion of the Sharia Supervisory Board (DPS) on Bank operations per period, included the first semester from January to June 2020 and the second semester from July to December 2020. SSB Opinions from January to June 2020 were 9 (nine) opinions and Opinions of SSB from July to December 2020 were 35 opinions in total. 4. SSB opinion on fund distribution and Bank services. In 2020, SSB had issued 2 (two) Sharia opinions, consisted of 1 (one) opinion in the First Semester and 1 (one) opinion in the Second Semester. 5. SSB opinion on joint financing activities. In 2020 SSB had issued 19 (nineteen) sharia opinions, consisted of 7 (seven) opinions in the First Semester and 12 (twelve) opinions in the Second Semester. 6. SSB opinion on the distribution of Bank benevolence funds. In 2020 SSB issued 21 (twenty one) sharia opinions in the Second Semester. 7. And the SSB opinion on the report of auditing to the Board of Directors, Management and OJK consisted of 2 (two) sharia opinions, 1 (one) opinion in the first semester of 2020 and 1 (one) opinion in the second semester of 2020. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  285. DISCLOSURE OF CONCURRENT POSITION The Sharia Supervisory Board of Bank NTB Syariah had not assinged any concurrent positions from January 2020 to December 2020 . PROGRAMS FOR INCREASING THE SHARIA SUPERVISORYBOARD COMPETENCIES Throughout the year of 2020, the members of the Sharia Supervisory Board had independently participated in various training, workshops and seminars to increase their competence in carrying out the duties, which have been described in the company profile. SHARIAH SUPERVISOR BOARD MEETINGS DPS of Bank NTB Syariah has discussed various agendas in meetings during 2020, which are described as follows: No Date Main Meeting Agendas 1. 14 January 2020 An Audit in Bima Branch Office Chairman, Member & Senior Advisor 2. 21 January 2020 An Audit in Sumbawa Branch Office Chairman, Member & Senior Advisor 3. 28 January 2020 An Audit in Pancor Branch Office Chairman, Member & Senior Advisor 4. 04 February 2020 An Audit in Karang Jangkong Branch Office Chairman, Member & Senior Advisor 5. 18 February 2020 Auditing Evaluation of 2nd Semester 2019 Chairman, Member & Senior Advisor 6. 20 February 2020 Meeting with Finance Division about Requesting Murabahah Tawarruq and cooperating with Asri Agency Chairman, Member & Senior Advisor 7. 25 February 2020 Discussing on opinion draft of SSD about the cooperation of PT. Bank NTB Syariah with Bank Dinar Syariah Chairman & Senior Advisor 8. 03 March 2020 Preparing the material and opinion draft of Finance Division, responding to opinion of Finance Division, and structuring the financing plan of 1st Semester 2020 Chairman, Member & Senior Advisor 9. 10 March 2020 Preparing the material for Branch Office training in the province of NTB Chairman, Member & Senior Advisor 10. 18 March 2020 Documentation of picture and Annual Report 2019 and discussing on deferral of training of all branches of PT. Bank NTB Syariah because of the Covid-19 outbreak Chairman & Senior Advisor 11. 24 March 2020 Discussing on audit findings 2nd Semester of 2019 Chairman & Senior Advisor 12. 14 April 2020 Discussing on financing requests (use of the MMQ contract) Member, Senior Advisor & Secretary 13. 21 April 2020 Discussing on opinion of MMQ contract Member, Senior Advisor & Secretary 14. 28 April 2020 Discussing on the finalization of MMQ technical guidelines of the Finance Division Chairman, Senior Advisor, & Secretary 15. 05 May 2020 Invitation for Dissemination of technical guidelines of MMQ contract financing 16. 13 May 2020 Discussing on Line Facility Financing Chairman, Senior Advisor, & Secretary 17. 27 May 2020 Discussing on opinion of the Bailout Fund of Finance Division Chairman, Senior Advisor, & Secretary 18. 02 June 2020 Finalizing Finance Division's opinion on the margin bailout of the Covid-19 outbreak Chairman, Senior Advisor, & Secretary 19. 04 June 2020 Joining a video conference with DSN-MUI Chairman, Senior Advisor, & Secretary 20. 15 June 2020 Revising the second semester audit results as material to review the 1st semester 2020 Chairman, Senior Advisor, & Secretary 21. 30 June 2020 Discussing on audit schedule of 1st Semester of 2020 Chairman, Senior Advisor, & Secretary 22. 02 July 2020 Discussing 2 opinions of Finance Division Chairman, Senior Advisor, & Secretary 23. 07 July 2020 An Audit in Bima Branch Office Chairman, Senior Advisor, & Secretary 24. 13 July 2020 Coordination meeting with Compliance and APP on regional government financing of East Lombok Chairman, Senior Advisor, & Secretary 25. 14 July 2020 An Audit in Selong Branch Office Chairman, Senior Advisor, & Secretary Spirit of Amanah, Optimistic and Growth in Sustainable Business Participants Chairman, Senior Advisor, & Secretary Chairman, Senior Advisor, & Secretary PT Bank NTB Syariah. 2020 Annual Report 284
  286. Good Corporate G ove r n a n c e No Date 26 21 July 2020 An Audit in Sumbawa Branch O ffice Chairman, Senior Advisor, & Secretary 27 28 July 2020 An Audit in Praya Branch Office Chairman, Senior Advisor, & Secretary 28 04 August 2020 An Audit in Tanjung Branch Office Chairman, Senior Advisor, & Secretary 29 11 August 2020 Revising the report of 1st semester 2020 Chairman, Senior Advisor, & Secretary 30 18 August 2020 Discussing on opinion of DNR Division and APP Desk Chairman, Senior Advisor DPS & Secretary 31 18 August 2020 Video Conference via Zoom Claud Meeting with DSN and Asdatun Coordination Meeting with the Board of Commissioners Chairman, Senior Advisor DPS & Secretary 32 25 August 2020 Discussing Draft of SSD training of 2nd Semester of 2020 33 27 August 2020 Interviewing with National Sharia Council 34 01 September 2020 Training of Sustainable Financial (KB) with Commissioners, Directors and General Managers (GM) 35 08 September 2020 Meeting to conclude and discuss opinion of the corporate secretary garding social donation from the benevolence funds re- Chairman, Senior Advisor DPS & Secretary 36 15 September 2020 Meetings with management and BPK regarding the detailed audits at the Bank Chairman, Senior Advisor DPS & Secretary 37 21 September 2020 Meeting to discuss request an opinion from the secretariat Chairman & Secretary 38 28 September 2020 Chairman & Secretary 39 30 September 2020 Discussion on the Finance Division's opinion on cooperation with BTPN; and on proposals from NTB 40 02 October 2020 Discussing opinion on financing cooperation with Co-operative of Selong and BTPN Chairman, Senior Advisor DPS & Secretary 41 07 October 2020 Discussing on distribution of benevolence fund 42 12 October 2020 Participating in Webinar Workshop of Pra-Ijtima’ Sanawi (Annual Meeting) of DSN-MUI Chairman, Senior Advisor DPS & Secretary 43 13 October 2020 Participating in Webinar Workshop of Pra-Ijtima’ Sanawi (Annual Meeting) of DSN-MUI Chairman, Senior Advisor DPS & Secretary 44 20 October 2020 Training of SSB, 2nd Semester of 2020 in Dompu Branch Office Chairman, Senior Advisor DPS & Secretary 45 27 October 2020 Training of SSB, 2nd Semester of 2020 in Pancor Branch Office Chairman, Senior Advisor DPS & Secretary 46 03 November 2020 Training of SSB, 2nd Semester of 2020 in Gerung Branch Office Chairman, Senior Advisor DPS & Secretary 47 05 November 2020 Participating in Webinar Workshop of Pra-Ijtima’ Sanawi (Annual Meeting) of DSN-MUI Chairman, Senior Advisor DPS & Secretary 48 06 November 2020 Participating in Webinar Workshop of Pra-Ijtima’ Sanawi (Annual Meeting) of DSN-MUI Chairman, Senior Advisor DPS & Secretary 49 10 November 2020 Training in Surabaya Branch Office Chairman, Senior Advisor DPS & Secretary 50 11 November 2020 Islamic financial literacy of PT. Bank NTB Syariah together with PAGARI NTB Chairman, Senior Advisor DPS & Secretary 51 13 November 2020 Training in Pejanggik Branch Office Chairman, Senior Advisor DPS & Secretary 52 17 November 2020 Discussion of request an opinion from the Corporate Secretary Chairman, Senior Advisor DPS & Secretary 53 24 November 2020 Discussion of request an opinion from the Corporate Secretary Chairman, Senior Advisor DPS & Secretary 54 30 November 2020 Islamic financial literacy with JSIT Chairman, Senior Advisor DPS & Secretary 55 08 December 2020 Discussing on opinion of benevolence fund Chairman, Senior Advisor DPS & Secretary 56 11 December 2020 Meeting with BPK, Submission of Audit Reports on the operations of PT. Bank NTB Syariah of Accounting Period of 2019-2020 (Quarter II) Chairman, Senior Advisor DPS & Secretary 57 15 December 2020 As resource Person of Islamic Financial Literacy with SERGAP (Islamic Boarding School Active Teachers Union) Chairman, Senior Advisor DPS & Secretary 58 17 December 2020 Attended Groundbreaking of Headquarter Construction of Bank NTB Syariah Chairman, Senior Advisor DPS & Secretary 59 29 December 2020 SSB audit preparation meeting, 2nd Semester of 2021 Chairman, Senior Advisor DPS & Secretary 285 PT Bank NTB Syariah. 2020 Annual Report Main Meeting Agenda Peserta Rapat Chairman, Senior Advisor DPS & Secretary Chairman, Senior Advisor DPS & Secretary Chairman, Senior Advisor DPS & Secretary Chairman, Senior Advisor DPS & Secretary Chairman, Senior Advisor DPS & Secretary Spirit of Amanah, Optimistic and Growth in Sustainable Business
  287. THE FREQUENCY OF MEETINGS The Sharia Supervisory Board of Bank NTB Syariah had organized 60 meetings . The following is the description of the number of participant attendance at the meetings during 2020: Name DPS Meeting Jabatan Number of Meetings Level Meeting Attendance Percentage of Level Attendance (%) H. Rubai Ahmad Munawar, Lc., M.Si Chairman 60 58 97% H. Hudatullah Muhibuddin, Lc., M.Si*) Member 60 10 17% Syarip Fuad Abdul Aziz DPS Expert Staff 60 58 92% Atikah Nurpatayat DPS Secretary 60 49 82% According to the Decision of General Meeting of Shareholders dated on 22nd April 2020, Hudatullah Muhibuddin had ended his tenure as the member of the board. WORK PLAN OF THE SHARIA SUPERVISORY BOARD 2020 1. 2. 3. 4. 5. 6. The Sharia Supervisory Board is an independent body appointed by the decision of GMS and DSN-MUI Recommendations which has the duty and responsibility to give suggestions to the board of directors and supervise the Bank's activities to act in accordance with Islamic principles. To guide and supervise the tasks in the bank are part of moral and spiritual responsibility that must be carried out by SSB. To fulfill the tasks in fostering, advising and supervising the business actor regarding the product and compliance of Islmaic principles, The Sharia Supervisory Board makes decisions by conducting deliberation to reach a consensus. The Sharia Supervisory Board gives a broad chance for all divisions and employees to consult openly and transparently regarding the matters related to the principles in implementing Islamic law in the field of muamalat, and others. The Sharia Supervisory Board emphasizes the importance of maintaining the values of morality, trustworthy and honesty as a foundation in carrying out duties and obligations to all peers of Bank NTB Syariah. The Sharia Supervisory Board requires all stakeholders and task executors to get the widest possible access to information regarding the governance and work procedures at the Bank so that all parties can coordinate properly for the realization of the Islamic principles according to the instructions of Allah and His Messenger. Refering to quoation in the Hadith of Rasululllah Sallallahu 'alaihi wa sallam affirmed that "Everyone of you is the leader, and you shall be asked about those you lead,” therefore, all parties in Bank NTB Syariah, especially policy makers, are expected to carry out their duties with honesty, sincerity and trustworthiness, as responsibilities for filing a report later. REALIZATION OF WORK PLAN OF THE SHARIA SUPERVISORY BOARD 2020 Apart from overseeing the Bank's operational activities in accordance with Islamic principles, the Sharia Supervisory Board has an obligation to provide suggestion to the board of directors and divisions related to the provision of fund management and operational policies of PT. Bank NTB Syariah. The Sharia Supervisory Board includes: 1. Assessing and ensuring the fulfilment of Islamic Principles over the operational guidelines and Islamic-related products issued by the Bank. 2. Observing the development process of the new products to meet the terms of the DSN-MUI fatwa. 3. Offering sharia opinions on new products and/or financing, both new financing and restructured financing in accordance with Islamic principles referring to the DSN-MUI Fatwa and the provisions controlling the implementation of Islamic principles and business activities of BUS and UUS. 4. Requesting a fatwa to DSN-MUI for the new product of the Bank. 5. Reviewing the mechanism of collecting data, finance distribution and bank services occasionally in line with Islamic principles; 6. Requesting data and information from the units/ divisions 7. SSB is obligated to perform its duties and responsibilities in accordance with the principles of Good Corporate Governance. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 286
  288. Good Corporate G ove r n a n c e To accomplish the tasks and mandates above , the Sharia Supervisory Board (DPS) has listed several programs consisting of: 1. Suggesting an opinion on the amount of financing requested by the related Division. 2. Conducting a socialization to promote the islamic economic and financial business in Islamic assembly meeting/ forum, to society, students, organization, academic institution in West Nusa Tenggara. 3. Organizing a training for the employees of Bank NTB Syariah in all Branch Offices. 4. Participating in training and meetings related to the development of Islamic banking with DSN-MUI and the Financial Services Authority (OJK). 5. Consultating to the National Sharia Council (DSN-MUI). The following is the realization of the program in 2020: 1. SSB had declared 44 opinions throughout the year of 2020. 2. As religious and community leaders, lecturers and organizational leaders, in every meeting with students and the community, the Sharia Supervisory Board always explains and invites the audience to apply religious principles and values in managing sharia-based economics and finance. Inviting students and the community to jointly build the Bank NTB Syariah. 3. As usual, DPS provides quarterly coaching in all Branch Offices and Supporting Branch Offices. The Sharia Supervisory Board provides guidance and explanations to all employees regarding the administrative and management processes that must be carried out in the Bank's operations in order to fully implement sharia and syamil principles. 4. To improve competence, the Sharia Supervisory Board participates in training and workshops related to the development of sharia economic and financial business, such as Certification and Capacity Building training for the Sharia Supervisory Board so that SSB has a competent, reliable and professional role in supporting the creation of a healthy Islamic banking industry. grow sustainably and be competitive. As well as the DSN-MUI Pre Annual Meeting Workshop in the socialization of the DSN-MUI Fatwa, Number 117-122 and the DSN-MUI Annual Meeting with OJK related to the Latest Policies and Developments of the DSN-MUI and Update on the Development of Islamic Banking and Finance and OJK Policies.SSB consultated to DSN-MUI regarding some matters about the financing spent by PT. Bank NTB Syariah. 5. Sampling methodology and technique of the inspection assessment in 2020, SSB conducted sampling/supervision and direct inspection at 12 Branch Offices with each Sub-branch Office: a. Bima Branch Office b. Dompu Branch Office c. Sumbawa Besar Branch Office d. Taliwang Branch Office e. Selong Branch Office f. Pancor Branch Office g. Praya Branch Office h. Gerung Branch Office i. Karang Branch Office j. KLU Branch Office 287 PT Bank NTB Syariah. 2020 Annual Report k. l. Pejanggik Branch Office Surabaya Branch Office The Concentration of sampling on documents: e. Ijarah a. Wadiah f. Murabahah b. Mudharabah g Musyarakah c. Deposit h. Musyarakah Mutanaqishah d. Giro 7. Conducted training for all Branch Offices and Sub-branch offices of PT Bank NTB Syariah focusing on: a. 1st Semester of 2020: 1) Organizing the administration of funds collection, savings and financing files for the fulfillment of Islamic aspects in all types of transactions. 2) Describing the content and meaning of financing contracts in order to explain it to the customers to be understood before the agreement because of the mulzim (mandatory) aspect of legal contract. 3) Defining financing contract forms to ensure the date, name and signature of the customer and bank clerk in charge are completely filled. 4) Describing the MMQ contract, a form of cooperation between two or more parties for ownership of a good or an asset. 5) Socializing the use of Wakalah contract in the MMQ contract. The Bank,on behalf of third party, rents the property intact to the customer with Wakalah contrat while the customer pays the lease fee for the use. b. 2nd Semester of 2020: 1) Describing the Islamic economic principles and financing business. 2) Defining risk-based bank rating level GCG to meet the sharia principles according to the regulation of Bank Indonesia and Financial Services Authority. 3) Clarifying the transactions checklist to confirm the completed file in order to meet the aspects of Islamic/sharia. 4) Describing the financing application form to ensure the date, name and signature of the customer and bank clerk in charge are completely filled. 5) Defining financing contract forms to ensure the date, name and signature of the customer and bank clerk in charge are completely filled. 6. Evaluating the implementation of Murabahah, Musyarakah, MMQ contracts and the like in the process of financing distribution to the customers. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  289. Table of SSB Training in 2020 in Branch O ffices & Sub-branch Offices of PT. Bank NTB Syariah Period 1st Semester -2020 Date Location 07-08 January 2020 Bima Branch Office 09-10 January 2020 Dompu Branch Office 14-15 January 2020 Sumbawa Branch Office 16 January 2020 Taliwang Branch Office 20 January 2020 Selong Branch Office 21 January 2020 Pancor Branch Office Pancor 22 January 2020 Praya Branch Office 23 January 2020 Gerung Branch Office 27 January 2020 Tanjung Branch Office 28 January 2020 Karang Jangkong Branch Office 29 January 2020 Pejanggik Branch Office 31 January 2020 Surabaya Branch Office 2nd Semester 19 October 2020 Bima Branch Office -2020 20 October 2020 Dompu Branch Office 22 October 2020 Sumbawa Branch Office 24 October 2020 Taliwang Branch Office 26 October 2020 Selong Branch Office 27 October 2020 Pancor Branch Office 02 November 2020 Tanjung Branch Office 03 November 2020 Gerung Branch Office 09 November 2020 Praya Branch Office 10 November 2020 Sriwijaya Branch Office 13 November 2020 Pejanggik Branch Office 18 November 2020 Surabaya Branch Office 8. Improved the understanding of Islamic Banking Practices such as conducting exit meeting after auditing in which SSB questions the manager and employees of Branch Office regarding the collection of financing funds to understand the problems and technical operations in branch office and to prove the operasional activities proceeded according to Islamic principles. Besides, SSB also gave intruction and reinforcement about “Islamic Banking Contruct and Product” to Branch Manager and the employees and acknowledged complaints and challenging faced by the team and expected feedback to increase the performance quality in Sharia/ Islamic way. These whole things may benefit all branch managers and employees to understand and recognize the sharia banking product and service scheme in total, including the standard contracts used in funding, financing and service products so that the business thrives constantly and achieves sharia compliance. To support all of the achievements above, SSB is morally and spiritually obliged to motivate and direct all branch managers and employees so that they always focus on Islamic morals /ethics in carrying out all duties and responsibilities that are mandated by Bank NTB Syariah. And this becomes an additional merit and fundamental feature of Bank NTB Syariah. OPINIONS AND SUGGESTIONS OF THE SHARIA SUPERVISORY BOARD Opinions Based on the results of supervision during 2020, SSB confirmed that, in general, the operational activities of Bank NTB Syariah were in accordance with the Sharia/Islamic Principles, Fatwa DSN-MUI and SSB Opinion. The errors/deficiencies occured during the operational do not lead to inaccuracies in making policies, but rather to individual understanding of a product and the Bank's Operational Guidelines. The SSB Opinion is as follows: Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 288
  290. Good Corporate G ove r n a n c e No Date Subject Number 1 . 15 January 2020 001/DPS/B.NTBS/I/2020 Termination of liability for customers who have passed away 2. 22 January 2020 002/DPS/B.NTBS/I/2020 Lauching Plan of New Product of PT. Bank NTB Syariah 3. 20 February 2020 003/DPS/B.NTBS/II/2020 Auditing results of SSB 2nd Semester of 2019 4. 25 February 2020 003/DPS/B.NTBS/II/2020 Cooperation Plan of PT. Bank NTB Syariah with PT. BPR Syariah Dinar Asri 5. 25 February 2020 004/DPS/B.NTBS/II/2020 Providing financing to ASNs who do not have assets under the Murabahah-Tawarruq agreement 6. 06 April 2020 005/DPS/B.NTBS/IV/2020 Use of Non-Halal Funds sourced from the PDAM Syndicated Financing Margin Income 7. 17 April 2020 006/DPS/B.NTBS/IV/2020 Financing guidelines with Musyarakah Mutanaqisah contract of Bank NTB Syariah 8. 08 May 2020 007/DPS/B.NTBS/V/2020 Plan of BPR Conventional Financing 9. 02 June 2020 008/DPS/B.NTBS/VI/2020 Bailout Installment Margin 10. 02 July 2020 009/DPS/B.NTBS/VII/2020 Requesting an opinion on Financing of Regional Government of West Lombok 11. 02 July 2020 010/DPS/B.NTBS/VII/2020 Sharia/Islamic aspects of guaranteed by other parties 12. 07 July 2020 011/DPS/B.NTBS/VII/2020 The use of Murabahah contract on financing of Regional Government of West Lombok 13. 20 July 2020 012/DPS/B.NTBS/VII/2020 Requesting on Financing of Regional Government of West Lombok with a Murabahah contract 14. 21 July 2020 013/DPS/B.NTBS/VII/2020 Financing Restructuring of Bank NTB Syariah 15. 12 August 2020 014/DPS/B.NTBS/VIII/2020 Financing the Cooperative of Karya Darma Selong 16. 13 August 2020 015/DPS/B.NTBS/VIII/2020 Auditing results of SSB 1st Semester of 2020 17. 01 September 2020 016/DPS/B.NTBS/IX/2020 Opinion of Mask Providing 18. 08 September 2020 017/DPS/B.NTBS/IX/2020 SOP to provide relief for margin payments/profit sharing, fines for non-performing financing and write-off financing for Bank NTB Syariah 19. 15 September 2020 018/DPS/B.NTBS/IX/2020 Providing of benevolence funds from Bank NTB Syariah 20. 15 September 2020 019/DPS/B.NTBS/IX/2020 Cooperation Agreement of PT. Pegadaian (persero) and PT. Bank NTB Syariah 21. 17 September 2020 020/DPS/B.NTBS/IX/2020 Opinion on providing of benevolence funds from PT. Bank NTB Syariah 22. 23 September 2020 021/DPS/B.NTBS/IX/2020 Opinion on providing of benevolence funds from PT. Bank NTB Syariah 23. 28 September 2020 022/DPS/B.NTBS/IX/2020 Opinion on providing of benevolence funds from PT. Bank NTB Syariah Tahun 2019 24. 29 September 2020 023/DPS/B.NTBS/IX/2020 Opinion on providing of benevolence funds from PT. Bank NTB Syariah (Musholla Al-Ikhlas) 25. 30 September 2020 024/DPS/B.NTBS/IX/2020 Opinion on asset sales pension fincancing with Bank BTPN 26. 02 October 2020 025/DPS/B.NTBS/X/2020 Opinion of financing for koperasi karya darma selong 27. 07 October 2020 026/DPS/B.NTBS/X/2020 Opinion on the use of benevolence funds 28. 13 October 2020 027/DPS/B.NTBS/X/2020 Opinion on Social Service and Gathering for Bank NTB Syariah employees 289 PT Bank NTB Syariah. 2020 Annual Report financing installments that are Spirit of Amanah, Optimistic and Growth in Sustainable Business
  291. No Date Number Subject 29 . 13 October 2020 028/DPS/B.NTBS/X/2020 Opinion on providing benevolence funds 2019 and 2020 30. 15 October 2020 029/DPS/B.NTBS/X/2020 The review opinion on the SOP regarding the guidebook for the financing restructuring company of PT Bank NTB Syariah 31. 15 October 2020 030/DPS/B.NTBS/X/2020 Opinion on the determination of Fee Based Income and profit sharing ratio of Tambora Savings Plan, Business Savings and Prestige Savings 32. 15 October 2020 031/DPS/B.NTBS/X/2020 Opinion of providing of benevolence funds from PT. Bank NTB Syariah 33. 24 October 2020 032/DPS/B.NTBS/X/2020 Opinion on the improvement of terms of use and virtue 34. 05 November 2020 033/DPS/B.NTBS/XI/2020 Opinion on distribution of benevolence funds for the construction of Daruk Abidin NW boarding school, of the AtTahrir Musholla, of the al-ikhlas mosque rehabilitation, of the Al-Istiqomah boarding school dormitory rehabilitation 35. 10 November 2020 034/DPS/B.NTBSXI/2020 Fire Donation in Batu lanteh, Sumbawa 36. 17 November 2020 035/DPS/B.NTBSXI/2020 Opinion on providing of benevolence funds from PT. Bank NTB Syariah 37. 20 November 2020 036/DPS/B.NTBSXI/2020 Opinion on Financing to financial coporates that have bailout products of Hajj 38. 23 November 2020 037/DPS/B.NTBS/XI/2020 Opinion on providing of benevolence funds from PT. Bank NTB Syariah 39. 01 December 2020 038/DPS/B.NTBS/XII/2020 Opinion on providing of benevolence funds from PT. Bank NTB Syariah 40. 15 December 2020 039/DPS/B.NTBS/XII/2020 Opinion on providing of benevolence funds from PT. Bank NTB Syariah 41. 15 December 2020 040/DPS/B.NTBS/XII/2020 Opinion on donation of Sembako (Nine Basic Needs) to the elder and the Covid-19 affected society 42. 18 December 2020 041/DPS/B.NTBS/XII/2020 Opinion on donation of contruction of Jami’ Al-Ikhlas Mosque, Taliwang 43. 18 December 2020 042/DPS/B.NTBS/XII/2020 Opinion on distribution of compensation to Orphans and Appreciation to Hafidz/ Hafidzah. 44. 23 December 2020 043/DPS/B.NTBS/XII/2020 Opinion on requesting a donation for Laptop, Building a Dormitory and a Home for Hafidz/ Hafidzah. Suggestion During the third year of its operations, Bank NTB as a Sharia Commercial Bank (BUS) or Bank NTB Syariah functioning in accordance with sharia/Islamic principles, the Sharia Supervisory Board (SSB) presents the following suggestions: 1. Policymakers at the Bank must emphasize the principles of good character among the employees so that they can carry out their duties with great responsible, honesty and reliablity; 2. SSB emphasizes to all levels mandated to manage Bank NTB Syariah to always show and practice noble morals and mutually inherit one another, not only in business behavior, but also in performance and daily morals; 3. It is important for management to remain iltizam (commitment) so that the treatment of Bank services and business remains in the legal and halal corridors in the framework of implementing sharia principles as a whole. 4. Bank NTB Syariah needs to continue to increase the volume of training for personnel and employees involved in the development activities of Bank NTB Syariah so that they can understand the sharia principles that must be applied in muamalah and contracts; 5. SSB emphasized that management should take policies that lead to reform and increase public welfare as well as expand the sharia financial industry and services 6. To achieve a life of blessing without usury, all employees of Bank NTB Syariah must always equip themselves with Qona'ah characteristics and carry out their duties honestly and with trust. 7. Bank NTB Syariah must be able to become a competitive and superior financial institution by creating a potential sharia market. 8. Bank NTB Syariah is expected to be able to open a wider network with other Islamic financial institutions and management bodies, Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 290
  292. Good Corporate G ove r n a n c e 9 . Bank NTB Syariah is expected to be able to open a wider network with other Islamic financial institutions and management bodies, both domestic and foreign, especially with Islamic Financial Institutions in the Middle East and other Islamic countries. 10. In this way, Bank NTB Syariah will be able to attract customers and open up potential markets from those who crave justice in mermuamalah in syar'i as well as material benefits without usury (riba). SHARIAH SUPERVISORY BOARD REMUNERATION POLICIES Bank NTB Syariah has remuneration procedure for the Members of SSB. The determination of procedure refers to the single salary system. The following is the remuneration policy of the Sharia Supervisory Board, period of January 2020 to December 2020: Table of Remuneration Component of the Sharia Supervisory Board Received in A Year Type of Remuneration and Facilities Member Remuneration (salary, routine benefits, bonuses, and other facilities in the form of non-benefits) Other facilities in kind (housing, transportation, health insurance, etc.) which: a. Can be owned b. Can not be owned Total Amount (Rp) 2 495.042.219 1 2 495.042.219 Table of Sharia Board Remuneration Amount Group No Amount / Remuneration per Person in 1 Year DPS Member 1. Above Rp2 billion - 2. Above Rp1 billion - 3. Above Rp500 million to 1 billion - 4. Rp500 million and below 2 291 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  293. PERFORMANCE ASSESSMENT OF SHARIA SUPERVISORY BOARD The performance evaluation of the Sharia Supervisory Board is carried out through the following procedures or mechanisms : 1. Assessment by the Annual GM The performance evaluation of the Sharia Supervisory Board is reflected in the results of the GMS that has accepted the responsibilities of the Management and released the Management from the management responsibilities of the previous period. Then it means the GMS has provided an assessment of the implementation of the Sharia Supervisory Board. 2. Assessment based on GCG Self Assessment The performance evaluation of the Sharia Supervisory Board is also carried out through GCG Self Assessment submitted to the OJK based on the OJK Circular Letter Number: 10/ SEOJK.03/2014 concerning the Assessment of the Health Level of Sharia Commercial Banks and Sharia Business Units. The GCG Self Assessment is conducted periodically every semester which is reported to the OJK for approval. PROCEDURE FOR IMPLEMENTING SHARIA SUPERVISORY BOARD PERFORMANCE EVALUATION PARTIES CONDUCTING PERFORMANCE EVALUATION OF SHARIA SUPERVISORY BOARD The Sharia Supervisory Board's performance assessment is included in the Bank's GCG Self Assessment which is conducted regularly every semester. The parties conducting GCG Self Assessment are the Directors and Board of Commissioners who must obtain approval and supervision from the OJK. SHARIA SUPERVISORY BOARD PERFORMANCE EVALUATION CRITERIA SHARIA SUPERVISORY BOARD PERFORMANCE EVALUATION RESULTS The Sharia Supervisory Board Self Assessment Criteria related to GCG implementation are divided into 3 (three) groups, namely Governance Structure, Governance Process, and Governance Outcome. The results of the 2020 Sharia GCG Implementation Self Assessment in Bank NTB Syariah, ranked 2 or GOOD. MECHANISM OF SELF RESIGN AND DISMISSAL OF SHARIA SUPERVISORY BOARD Based on the Articles of Association of Bank NTB Syariah, the Sharia Supervisory Board has the right to resign from his position by giving written notice of the intention to the Company at least 30 (thirty) days before the date of his resignation. The position of member of the Sharia Supervisory Board ends if: 1. Loss their Indonesian citizenship. 2. Self-resign. 3. No longer meets the requirements of the applicable legislation. 4. Passed away. 5. Dismissed based on the decision of the General Meeting of Shareholders Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 292
  294. Good Corporate G ove r n a n c e BOARD OF COMMISSIONERS According to Law No . 21 of 2008 regarding Islamic Banking and regulation of Bank Indonesia No: 11/33/PBI/2009 the Implementation of Good Corporate Governance of Islamic Commercial Banks and Business Units, the board of commissioners had completed its responsibilities and duties profesionally and independently. The Board of Commissioners is appointed at GMS and is effective after receiving prior approval by the Financial Services Authority; taking the fit and proper test (PKK). The Board of Commissioners is a corporate organ that is collectively in charge in and responsible for supervising and offering suggestions to the Board of Directors as well as ensuring the Bank implements Good Corporate Governance (GCG) at all levels of the organization. The Board of Commissioners must have adequate understanding and competence so that they can supervise and provide advice to the Board of Directors in dealing with problems arisen in the Bank's business activities, make decisions independently, encourage improvement in the Bank's performance, and effectively conduct reviews and support constructive advice on performance of Directors. The Board of Commissioners carries out its duties and responsibilities in accordance with the authorities assigned in the Articles of Association and the prevailing laws and regulations. The implementation of the duties and responsibilities of the Board of Commissioners is also regulated in the Board of Commissioners' guidelines and work rules which is evaluated and updated regularly. The Board of Commissioners is responsible for the General Meeting of Shareholders (GMS). The responsibility of the Board of Commissioners to the GMS is a manifestation of the principles of transparency, accountability, responsibility, and professionalism in supervising and advising the Board of Directors on the course of the corporate to implement the GCG principles. LEGAL BASIS The Board of Commissioners of Bank NTB Syariah performs duties based on the regulations, but also it is not limited to the regulations as follows: 1. The Law No. 40 of 2007 regarding Limitied Liability Companies; 2. The Law No. 21 of 2008 concerning Islamic Banking; 3. The Regulation of Bank Indonesia No: 11/3/PBI/2009 regarding Islamic Commercial Bank; 4. The Regulation of Bank Indonesia No: 11/33/PBI/2009 concerning the Implementation of Good Corporate Governance of Islamic Commercial Banks and Business Units; 5. POJK No: 2727/POJK.03/2016 regarding Fit and Proper Test of Main Parties of Financial Services Institutions; 6. The Amendment of the Articles of Association as referred to decision of the Annual GMS Deced No. 5 dated on 21st August 2018; 7. The Recommendation of Nomination Committee and Remuneration of Bank NTB Syariah; 8. The Decision Statement of the Extraordinary General Meeting of Shareholders of PT Bank NTB dated on 21st August 2018 concerning the assignment and structure of the Board of Directors, Board of Commissioners and Sharia Supervisory Board of Bank NTB Syariah. GUIDELINES AND RULES FOR THE BOARD OF COMMISSIONERS The Board of Commissioners, in performing its duties, is guided by the Decree of the Board of Commissioners of PT Bank NTB Syariah Nomor: 055/DK-SK/I/08/2020 dated 26 August 2020 concerning Guidelines and Work Rules of the Board of Commissioners at PT Bank NTB Syariah. In brief, the guidelines standardize the Work rules of the Board of Commissioners Chapter I : General Provisions Chapter II : Organization, Membership Requirements and Terms of Office of the Board of Commissioners Chapter III : Duties, Powers and Responsibilities Chapter IV : Meetings and Minutes of Meetings Chapter V : Transparency and Prohibition for the Board of Commissioners Chapter VI : Ethics, Working Time, Signing, Documents, and Others Chapter VII : Closing 293 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  295. CRITERIA OF THE BOARD OF COMMISSIONERS Bank NTB Syariah has criteria of Members of the Board of Commissioners as stated in the Articles of Association . These criteria are based on regulations, including/but not limited to Law No. 40 of 2007 concerning Limited Liability Companies, Law Number 21 of 2008 concerning Islamic Banking, and Regulation Bank Indonesia No: 11/33/PBI/2009 concerning the Implementation of GCG concerning Sharia Commercial Banks and Sharia Business Units. The appointment of Members of the Board of Commissioners at the General Meeting of Shareholders is by taking into account the recommendations of the Remuneration and Nomination Committee considering some criteria such as integrity, competency, professionalism and financial reputation. Members of The Board of Commissioners Bank NTB Syariah hold the citizenship of the Republic of Indonesia and must have obtained the approval of the Financial Services Authority in the Fit and Proper Test. In order to fulfill the integrity and competency aspects, prospective members of the Board of Commissioners are required to have /but are not limited to the following standards: 1. Ahklak dan moral yang baik; 2. Komitmen untuk mematuhi peraturan perundang undangan yang berlaku; 3. Komitmen yang tinggi terhadap supervise dan operasional bank yang sehat; dan 4. Tidak termasuk dalam daftar yang tidak disetujui Otoritas Jasa Keuangan Competency 1. Having an adequate knowlegde in banking and relevant to its position; 2. Having an experience and expertise in banking and / or finance; and 3. Having an ability to supervise strategic policies in the context of developing a healthy bank. TOTAL NUMBER AND COMPOSITIONS OF BOARD OF COMMISSIONERS To select the members of the Board of Commissioners, in accordance with Shareholders' policies, the diversity of structure has taken into account according to the needs and complexity of Bank NTB Syariah so that it is expected to solve the problems from various perspectives of education, competence, and experience for the development of Bank NTB Syariah. Based on Article 25 of PBI No: 11/3 / PBI / 2009 concerning Sharia Commercial Banks, that the number of Members of the Board of Commissioners is at least 3 (three) people and the maximum is the same as the number of Members of the Board of Directors. As of 31st December 2020, The Board of Commissioners of Bank NTB Syariah was 3 (three) people, consisting of 1 (one) Independent President Commissioner, 1 (one) Independent Commissioner and 1 (one) Commissioner. All Members of The Board of Commissioner had passed the nomination process by the Remuneration and Nomination Committee of Bank NTB Syariah and were appointed based on the resolution of the GMS. The effective membership of the Board of Commissioners had been notarized and reported to the Ministry of Law and Human Rights. The Struture of The Board of Commissioners of Bank NTB Syariah per 31st December 2020 is as follows: Name Positions Period GMS Decision H. Zainal Fanani Independent President Commissioner 04/09/2018-04/09/2022 Decision of the E-GMS August 21, 2018 H. Muslihun Independent Commissioner 04/09/2018-04/09/2022 Decision of the E-GMS August 21, 2018 H. Muhammad Nur Commissioner 04/09/2018-04/09/2022 Decision of the E-GMS August 21, 2018 Determination of the composition and number of members of the Board of Commissioners is done by taking into account the vision and mission and the strategic plan of Bank NTB Syariah so that decision making can be done effectively, accurately and quickly, and uphold the independence and solely for the benefit of the Bank. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 294
  296. Good Corporate G ove r n a n c e ASSESSMENTS OF CAPABILITIES AND INTEGRITY The fit and proper test is regulated by the Authority based on POJK Number: 27/POJK.03/ 2016 concerning the Fit and Proper Test for Main Parties of Financial Services Institutions and SE OJK Number: 39 / SEOJK.03 / 2016 concerning the Fit and Proper Test for Controlling Shareholders, Candidates for Members of the Board of Directors and Candidates for Members of the Board of Commissioners, stated that Members of the Board of Commissioners are obliged to obtain approval from OJK before carrying out their duties and functions. All members of the Board of Commissioners that work until 31st December 2020 have received approval from the Financial Services Authority which indicates that each member has adequate integrity, competency and good financial reputation. This is to ensure that the members are able to carry out their duties as supervisors and advisers in the banking sector. Name Position Period Executing Approval of Fit & Proper tTest H. Zainal Fanani Independent President Commissioner 04/09/201804/09/2022 Otoritas Jasa Keuangan No. KEP - 144/D.03/2018 September 4, 2018 H. Muslihun Independent Commissioner 04/09/201804/09/2022 Otoritas Jasa Keuangan No. KEP - 133/D.03/2018 August 8, 2018 H. Muhammad Nur Commissioner 04/09/201804/09/2022 Otoritas Jasa Keuangan No. KEP - 134/D.03/2018 August 8, 2018 DUTIES AND RESPONSIBILITIES OF THE BOARD OF COMMISSIONERS The Board of Commissioners has clear functions, duties and responsibilities in accordance with the Articles of Association and authority granted by the GMS, which are stated in the Board of Commissioners' Guidelines and Work Rules. The duties and responsibilities of The Board of Commissioners are as follows: 1. The Board of Commissioners supervises the implementation of duties and responsibilities of the Board of Directors and provides advice to the Board of Directors. 2. The supervision based on No. 1 is referred to the provisions of OJK concerning the implementation of GCG that is applicable to the bank 3. Supervision and provision of advice as referred to in number 1 above are carried out for the benefit of the corporate and in accordance with the aims and objectives of the corporate. 4. The Board of Commissioners, in conducting its duties and responsibilities as well as authorities, is required to observe the articles of association of the Bank, the work guidelines and rules of the Board of Commissioners, the prevailing laws and regulations. 5. The Board of Commissioners must have good intention, prudence and be responsible in completing supervisory duties and providing advice to the Board of Directors for the interests of the Bank according to the Law and Articles of Association of the Bank. 6. The Board of Commissioners actively supervise the compliance function of the Bank. 7. The Board of Commissioners carries out active observation of the implementation of risk management. The application 295 PT Bank NTB Syariah. 2020 Annual Report of risk management must be adjusted to the objectives, business policies, size, business complexity and capacity of the Bank. 8. The Board of Commissioners is obliged to ensure that the Board of Directors has comprehended the audit findings and recommendations from the Internal Audit Division, External Auditor, results of supervision by the Financial Services Authority and/or of supervision by other authorities. 9. The Board of Commissioners is obliged to notify the Financial Services Authority no later than 7 (seven) working days after the audit fundings: a. Violation of laws and regulations in the financial and banking sector and; b. Circumstances or predictable circumstances that may endanger the stability of the Bank's business 10. In order to support the effectiveness of duties and responsibilities. The Board of Commissioners are required to form at least: a. Audit Committee; b. Risk Monitoring Committee; c. Remuneration and Nomination Committee. 11. The Board of Commissioners is obligated to ensure that the committees that have been formed serve effectively. AUTHORITIES OF THE BOARD OF COMMISSIONERS In order to carry out their duties and responsibilities according with the Laws, Financial Services Authority Regulations, Articles of Association and other applicable provisions to ensure the implementation of Good Corporate Governance in every bank business at all levels of the organization, The Board of Commissioners and its apparatus are authorized to: Spirit of Amanah, Optimistic and Growth in Sustainable Business
  297. 1 . 2. 3. 4. 5. 6. 7. 8. Monitoring all units/divisions including Branch Office/Sub-Branch Office; Having the rights any time during the office working hours to enter the buildings and all surroundings managed by the Bank and having the rights to examine all books, letters and other evidence and check; to match the condition of cash and others; to know all actions that has been carried out by the Board of Directors in accordance with the Articles of Association of PT Bank NTB Syariah; Requesting each member of the Board of Directors and/or management to provide an explanation of all matters concerning the Bank as required by The Board of Commissioners. Temporarily suspending all Members of the Board of Directors by stating the reasons and if the Bank does not have any Member of Directors, then the Board of Commissioners is required to manage the Bank temporarily. In such a case, the Board of Commissioners has the rights to grant temporary authority to one or more members of the Board of Commissioners; To conduct the temporary dismissal as referred to in number 4 above, the GMS must be held in writing to the Member of the Board of Directors concerned within 30 (thirty) days after the date of dismissal. Approving the appointment of the General Manager of the Internal Control Unit (SKAI) proposed by the Board of Directors; In certain circumstances such as only one existing Member of the Board of Commissioners, all duties and responsibilities are assigned to the President Commissioner or Member of The Board of Commissioners as it is stated in the Bank's Articles of Association; In supervising, the Board of Commissioners is prohibited from being involved in making a Decision of operational activities of Bank Umum Syariah (BUS), except for making a Decision of financing for the Board of Directors and as long as the authority of the Board of Commissioner is stipulated in the Articles of Association of the BUS or in the General Meeting of Shareholders. 1. 2. 3. 4. 5. APPOINTMENTS OF BOARD OF COMMISSIONERS The appointment of The Board of Commissioners is possible to be accomplished when the requirements set out in the company's articles of association and the provisions of Good Corporate Governance has been fulfilled and the boad of commissioners has passed the fit and proper test in accordance with the Financial Services Authority Regulations and applicable laws. 6. Ethics related to modeling The Board of Commissioners must encourage good behavior and uphold the highest ethical standards in the corporate by making himself a good role model for Directors and Employees. Ethics related to Compliance with Laws and Regulations The Board of Commissioners is obliged to comply with the prevailing laws and regulations, the Articles of Association, GCG Guidelines and the authenticated corporate policies. Ethics related to Information Disclosure and Confidentiality The Board of Commissioners must disclose information in accordance with the prevailing laws and regulations and maintain the confidentiality of the information entrusted, including bank and customer secrets according to with the provisions of applicable laws, regulations and corporate policies. Ethics related to Opportunity During the tenure, The Board of Commissioners is not allowed to: a. Taking the corporate’s business opportunities for himself b. Using Corporate assets, information or position as Member of the Board of Commissioners for personal interests that are contrary to the provisions of laws and regulations and applicable Corporate policies. Ethics related to Conflict of Interest It is defined as a certain condition in which the interest of the Member opposes the company and the Decision of General Meeting of Shareholders to gain profit, increase value, achieve the vision and carry out the mission that turn to cause disadvantage to the Company. For this reason, the Members of The Board of Commissioners are expected to: a. Avoiding conflicts of interest b. recording the ownership of shares and/ or their families in the Company or other companies. c. Having a decent attitude that guided to not take advantage of one's position for personal gain or for the interests of other people or parties that are opposed with the Company. d. Avoiding any activity that could affect his independence in carrying out his duties. e. Disclosing a conflict of interest, and the Member of the Commissioner concerned may not be involved in the decision making process of the Company relating to this matter. Etika related to bribery The Board of Commissioners is obligated to avoid bribery in any way and form in order to prevent detrimental to the company. ETHICS OF BOARD OF COMMISSIONERS 1. The Board of Commissioners’ duties and fuctions must be executed based on occupational ethics. The ethics of the position of the Commissioner are as follows: Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 296
  298. Good Corporate G ove r n a n c e HUBUNGAN AFILIASI DEWAN KOMISARIS The members of Commissioners declares financial and family relations with the board of commissioners, Directors and Controlling Shareholders as the following table below: Financial Relations With Name Position Board of commissioners Yes H. Zainal Fanani No Family Relations With Directors Controlling shareholders Yes Yes No No Board of commissioners Yes No Directors Yes No Controlling shareholders Yes No Independent President Commissioner H. Muslihun Independent Commissioner H. Muhammad Nur Commissioner OWNERSHIP OF BOARD OF COMMISSIONERS The Board of Commissioners has revealed the ownership of shares in both Bank NTB Syariah and other companies. For share ownership as of December 31, 2020, the Board of Commissioners does not own shares with total ownership of 5% (five percent) or better in banks or other companies, summarized in the following table: Name Shareholding Position Bank Other Bank Non-Bank Financial Institutions Other Companies H. Zainal Fanani Komisaris Utama Independen Nothing Nothing Nothing Nothing H. Muslihun Komisaris Independen Nothing Nothing Nothing Nothing Nothing Nothing Nothing Nothing H. Muhammad Nur Komisaris INDEPENDENT COMMISSIONERS Based on the struture of the Board of Commissioners per 31st December 2020, Bank NTB Syariah had appointed 2 (two) Independent Commissioners out of 3 (three) existing members in total, namely Zainal Fanani and Muslihun. Thus, the struture of Member of the Board of Independent Commissioners had met the requirement for the number of Independent Commissioners at least 50% as stipulated in Bank Indonesia Regulation Number 11/33/PBI/ 2009 concerning the Implementation of GCG for Islamic Commercial Banks and Business Units CRITERIA OF INDEPENDENT COMMISSIONERS Penetapan Komisaris Independen telah mengacu pada beberapa ketentuan seperti Undang Undang Perusahaan Terbatas Nomor 40 Tahun 2007 tentang Perseroan Terbatas dan Undang-Undang Nomor 21 Tahun 2008 tentang Perbankan Syariah dan Peraturan Bank Indonesia Nomor: 11/33/PBI/2009 tentang Pelaksanaan GCG Bagi Bank Umum Syariah dan Unit Usaha Syariah. Dalam pengangkatan Komisaris Independen, Bank NTB Syariah telah mempertimbangkan hal-hal sebagai berikut. 297 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  299. 1 . 2. 3. 4. 5. Does not have a financial relationship, family with fellow members of the Board of Commissioners, members of the Board of Directors, Shareholders and or other relationships that can affect his ability to act independently; The Board of Commissioners does not hold concurrent positions as a Commissioner, Board of Directors, or executive officer at a Bank (Commercial Bank, BPR) and other financial institutions; Has passed the Fit and Proper Test under Bank Indonesia provisions concerning the Fit and Proper Test; To be elected and appointed at the General Meeting of Shareholders through the recommendation of the Remuneration and Nomination Committee; and Within 5 (five) years before his appointment, he was never declared bankrupt, became a member of the Board of Directors or a member of the Board of Commissioners who was found guilty of causing the company to go bankrupt. STATEMENTS OF INDEPENDENT COMMISSIONERS The Independent Commissioner of Bank NTB Syariah has signed an Independent Declaration whose content is following applicable laws and regulations and has been submitted to the Financial Services Authority as one of the required documents for OJK approval to become a member of the Board of Commissioners of Bank NTB Syariah. The independent statements are referred to as follows: No Main Meeting Agendas Zainal Fanani 1. Main Meeting Agendas Does not have a financial relationship, management relationship, share ownership and / or family relations with other members of the Board of Commissioners, Directors and / or Controlling Shareholders or relationships with Banks, which can affect the ability to act Independent as stipulated in the provisions of GCG implementation for Commercial Banks 2. Is a party that is independent of the bank owner or Controlling Shareholder 3. If in the future, it is found to have the relations as referred to in point 1 above, then the person concerned is willing to release the position of his Independent Commissioner and is willing to be replaced Muslihun MEETINGS OF BOARD OF COMMISSIONERS The meeting of The Board of Commissioners is chaired by the President Commissioner. However, if the President Commissioner is unable to attend, the meeting of The Board of Commissioners is possible to be led by a Member Commissioner who is specially appointed by the President Commissioner. And, in case that the President Commissioner does not make any statement to be represented, the meeting will be chaired by Commissioners appointed by other Commissioners. In accordance with the provisions of the Board of Commissioners' work guidelines and rules, the the meeting is catagorized as follows: a. The meeting must be held periodically at least once every 2 months; b. The Joint Meeting of the Board of Commissioners and the Board of Directors held at least once a month. BOARD OF COMMISSIONERS MAIN MEETING AGENDA AND JOINT MEETING The Board of Commissioners Bank NTB Syariah had held meetings during 2020 to discuss various agendas both in the Internal Meeting of the Board of Commissioners, Joint Meeting with the Board of Directors, which are described as follows: No Date Main Meeting Agendas 1. 2 January 2020 Strengthening the Functions and Roles of the Board of Commissioners 2. 16 January 2020 Plans and Strategies to Achieve TPF Business Targets with Services and Funds Division 3. 28 January 2020 Framework of Risk Management & Work relations of Risk Management with Division of Kep & MJR Spirit of Amanah, Optimistic and Growth in Sustainable Business Zainal Fanani M. Nur Muslihun PT Bank NTB Syariah. 2020 Annual Report 298
  300. Good Corporate G ove r n a n c e No Date Main Meeting Agendas Zainal Fanani 4 . 29 January 2020 Presentation of Work Program of Division of SPI 2020 5. 12 February 2020 Supervisory Report Semester II / 2019 6. 27 February 2020 MJR Desk Consultation with the President Commissioner + KPR 7. 19 May 2020 Branch Development Strategy in Business Development of Bank NTB Syariah with Division of SPI (Internal Control Unit) 8. 03 June 2020 Guidelines and Implementation of Performance Management with Divison of Human Resources & Div. of REN 9. 03 June 2020 Discussion on the Proposed Amendment of RBB of PT Bank NTB Syariah 2020 - 2022 10. 1 July 2020 Consolidation Meeting of the Board of Commissioners and Audit Committee (Evaluation of KA) 11. 21 July 2020 Report and Follow-up on the Results of the First Semester of 2020 with Division of SPI 12. 22 July 2020 Compliance Study and Risk Management of SEVP Formation (with Div. KEP & MJR) 13. 12 August 2020 Discussion on Supervisory Report or Realization of the RBB SMT I 2020 14. 25 August 2020 Discussion on Work Guidelines and rules of the Board of Commissioners PT Bank NTB Syariah 15. 25 August 2020 Gathering and Coordination of the Implementation of Supervision and Advisory Functions in Accordance with the Duties of the Board of Commissioners and SSB 16. 26 August 2020 Review of Work Guidelines and rules of the Board of Commissioners PT Bank NTB Syariah 17. 22 September 2020 Selection of Candidate of Mamber of the Board of Commissioners of PT Bank NTBS 18. 06 October 2020 Maximizing the Duties and Responsibilities of Committees under the Board of Commissioners of PT Bank NTBS 19. 06 October 2020 Briefing of The Board of Commissioners to organize Fit & Proper Test for Management Candidates of PT Bank NTB Syariah 20. 07 October 2020 Discussion on the Participation of Bank NTBS in the Sharia Monetary Authority 21. 04 November 2020 Commitment on Follow-Up Results of Investigation on Capital Fulfillment Strategy 3T 22. 17 November 2020 Discussion on RBB 2021-2023 and RAKB of PT Bank NTB Syariah in 2021 23 26 November 2020 Discussion of Organizational Structure Changes 299 PT Bank NTB Syariah. 2020 Annual Report M. Nur H. Muslihun Spirit of Amanah, Optimistic and Growth in Sustainable Business
  301. Table Joint Meetings of the Board of Commissioners and Directors No Date Main Meeting Agendas Zainal Fanani 1 . 17 January 2020 Performance Evaluation Meeting December 2019 2. 11 February 2020 Performance Evaluation Meeting January 2020 3. 26 February 2020 Discussion of RUPS Meeting for the 2019 4. 17 March 2020 Performance Evaluation February 2020 5. 15 April 2020 Performance Evaluation March 2020 6. 15 May 2020 Performance Evaluation April 2020 Video Conference by Zoom 7. 19 June 2020 Performance Evaluation May 2020 Video Conference by Zoom 8. 14 July 2020 Performance Evaluation June 2020 Video Conference by Zoom 9. 11 August 2020 Performance Evaluation July 2020 10. 23 September 2020 Performance Evaluation August 2020 11. 21 October 2020 Performance Evaluation September 2020 12. 18 November 2020 Performance Evaluation October 2020 M. Nur Muslihun FREQUENCIES AND MEETING ATTENDANCES During 2020, the Board of Commissioners of Bank NTB Syariah held 23 Meetings and 14 Joint Meetings with the Board of Directors, thus the Board of Commissioners held 53 meetings. Attendance at meetings during 2020 is described as follows: Number of Attendances Nama Perecentage (%) Total Meeting of the Board of Commissioners Joint Meeting H. Zainal Fanani 22 12 34 >100% H. Muslihun 17 12 29 >100% H. Muhammad Nur 21 12 33 >100% *Based on PBI No.11/33/PBI/2009 of the Board of Commissioners meeting duties of once in 2 (two) months. BOARD OF COMMISSIONERS COMPETENCY DEVELOPMENTS Throughout 2020, members of the Board of Commissioners of the Company have participated in various competency improvement programs in the form of training, workshops, conferences, seminars and have been presented in Company Profile. IMPLEMENTATIONS OF RISK MANAGEMENT CERTIFICATIONS In addition to the competency improvement program, the Board of Commissioners of Bank NTB also follows the Risk Management Certification program. In 2020, the Board of Commissioners of Bank NTB who have passed the risk management certification are as follows: Name Date Risk Management Certification H. Zainal Fanani Independent President Commissioner Level V H. Muslihun Independent Commissioner Level II H. Muhammad Nur Commissioner Level I Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 300
  302. Good Corporate G ove r n a n c e THE BOARD OF COMMISSIONERS REMUNERATION POLICIES Board Of Commissioners Remuneration Policies refers to the Bank 's Articles of Association and are based on the decision of General Meeting of Shareholders which stipulates that Members of the Board of Commissioners can be given a salary and benefits with a single salary system. The components of the remuneration and nominal amount received by the Directors are as follows: Nominal Amount/Component of Board of Commissioners' Remuneration Amount Received in 1 Year Types of Remuneration and Other Facilities Members Remuneration (salary, routine benefits, bonuses, and other facilities in the form of non-nature) Other facilities in kind (housing, transportation, health insurance, etc.) which: a. Can be owned b. Cannot be owned Total Amount (Rp) 3 2.004.895.518 1 3 2.004.895.518 Table: The Amount of Board of Commissioners Remuneration Group Amount/Remuneration per Person in 1 Year Members Above Rp2 billion - Above Rp1 billion - Above Rp500 million to Rp1 billion 3 Rp500 million to below - SUPERVISION OF THE BOARD OF COMMISSIONERS IN 2020 As a form of active supervision, during 2020 the Board of Commissioners approved and provided input on the Bank's Business Plan, GCG Implementation, Conversion Process, Corporate Plan, Business Plan Evaluation, Integrated Governance, Compliance Director's Report Evaluation, Emergency funding plan, and stress test needs Bank liquidity, evaluation of implementation reports and principal results of internal audits, and supervision and advice related to tax disputes. Since 2019, the Board of Commissioners has issued various decisions and approvals, including related aspects as follows: No Date 1. 08 January 2020 01/RKDBid/DK/01/2020 Plans and Strategies for Achieving Fundraising Business Targets 2. 09 January 2020 SB.02/DK/01.22/64/01/2020 Renovation of PT Bank NTB Syariah Committee Room for the Board of Commissioners 3. 09 January 2020 SB.03/DK/01.22/64/01/2020 Application for new products and / or activities 4. 17 January 2020 03/RKDBid/DK/01/2020 Meetings of the Board of Commissioners and Directors (Rakomdirbid) of Compliance and Risk Management 5. 28 January 2020 SB.05/DK/01.22/64/01/2020 PT Bank NTB Syariah GCG Implementation Self-Assessment Report Draft Semester II Year 2019 6. 29 January 2020 SB.06/DK/01.22/64/01/2020 Approval of the Work Program and Annual Budget of the PT Bank NTB Syariah Internal Audit Unit Division for 2020 7. 29 January 2020 SB.07/DK/01.22/64/01/2020 Renovation of the Bank NTB Syariah KCP Mataram Cakranegara 301 PT Bank NTB Syariah. 2020 Annual Report Reference Number Subject Spirit of Amanah, Optimistic and Growth in Sustainable Business
  303. No Date Reference Number Subject 8 . 17 February 2020 SB.08/DK/01.22/64/02/2020 RBB Supervision Report for Semester II 2019 Annual Report 9. 14 February 2020 SB.09/DK/01.22/64/02/2020 Integrated Governance Implementation Report for Semester II Year 2019 10. 27 February 2020 SB.10/DK/01.22/64/01/2020 Explanation of the Semester II 2019 of RBB Supervision Report 11. 02 March 2020 SB.11/DK/01.22/64/01/2020 Compliance and Risk Management Study of PT Bank NTB Syariah Annual Financial Report Publication Plan 12. 05 March 2020 SB.12/DK/01.22/01/03/2020 Evaluation of the Implementation of Duties of the Public Accounting Firm (KAP) and the Public Accounting Firm (KAP) 13. 09 March 2020 SB.15/DK/01.22/64/03/2020 Explanation of the PT Bank NTB Syariah RBB Supervision Report Semester II 2019 14. 18 March 2020 SB.16/DK/01.22/64/03/2020 Proposal for Determining KAP as Auditor for Financial Statements of PT Bank NTB Syariah for the 2020 Financial Year 15. 20 March 2020 SB.17/DK/01.22/64/03/2020 Evaluation Results of the Audit Committee on the Implementation of Providing Audit Services for Annual Historical Financial Information 16. 30 March 2020 SB.18/DK/01.22/64/01/2020 Management Letter of 2019 17. 06 April 2020 SB.19/DK/01.22/64/04/2020 Advisory Board of Commissioners on POJK 11 / POJK.03 / 2020 18. 09 April 2020 SB.20/DK/01.22/01/04/2020 Study of Governance (Management) of PT Bank NTB Syariah in its study with Permendagri No. 37 of 2018 19. 13 April 2020 SB.21/DK/01.22/64/04/2020 Correction of the Draft Annual Report for the 2019 Financial Year 20. 14 April 2020 SB.22/DK/01.22/01/04/2020 Review of SKAI Performance by an Independent Party 21. 14 April 2020 SB.23/DK/01.22/64/04/2020 KRN Candidates recommendationsfor BOC and SSB Members 22. 16 April 2020 SB.24/DK/01.22/64/04/2020 KRN Recommendation for Candidate Members of the Board of Commissioners of PT Bank NTB Syariah 23. 22 April 2020 SB.25/DK/01.22/64/04/2020 Increasing the Effectiveness of the Implementation of SKAI's Duties in the Covid-19 Period 24. 28 April 2020 SB.26/DK/01.22/64/04/2020 Evaluation of the IT Implementation for period 31 December 2019 25. 29 April 2020 SB.27/DK/01.22/64/04/2020 Fulfillment of Commitment to Follow Up on Audit Results up to March 2020 26. 06 May 2020 SB.28/DK/01.22/64/05/2020 Implementation of POJK Covid-19 Stimulus 27. 08 May 2020 SB.29/DK/01.22/90/05/2020 BPP APU-PPT PT Bank NTB Syariah 28. 13 May 2020 SB.30/DK/01.22/64/05/2020 Organizational Structure Adjustments 29. 14 May 2020 SB.30A/DK/01.22/64/05/2020 Study of Related Financing 30. 15 May 2020 04/Rakomdirbid/DK/05/2020 Branch Development Strategy in Business Development of Bank NTB Syariah 31. 18 May 2020 SB.31/DK/01.22/01/05/2020 Follow up on Agenda IV Resolution of the GMS of Bank NTB Syariah for the 2020 Financial Year 32. 20 May 2020 SB.32/DK/01.22/90/05/2020 Organizational Structure Adjustments 33. 27 May 2020 05/Rakomdirbid/DK/05/2020 Guidelines and Implementation of Performance Management Violation of the Statutory Reserves (GWM) Averaging of PT Bank NTB Syariah Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 302
  304. Good Corporate G ove r n a n c e No Date Reference Number Subject 34 . 29 May 2020 SB.33/DK/01.22/64/04/2020 Violation of the Statutory Reserves (GWM) Averaging of PT Bank NTB Syariah 35. 04 June 2020 SB.34/DK/01.22/64/06/2020 Submission of Minutes of the Prudential Meeting on May 8, 2020 36. 10 June 2020 SB.36/DK/01.22/01/06/2020 Follow up on Agenda IV Resolution of the GMS of Bank NTB Syariah for the 2019 Financial Year 37. 12 June 2020 SB.37/DK/01.22/64/06/2020 Cover Letter to the Minutes of the Board of Commissioners with the Directorate of Fields (Rakomdirbid) SDI and REN regarding the Implementation of Employee Performance Management of PT Bank NTB Syariah 38. 24 June 2020 SB.38/DK/01.22/01/06/2020 Approval of PT Bank NTB Syariah RBB 2020-2022 39. 30 June 2020 SB.40/DK/01.22/64/12/2020 Cover Letter for Study of the Remuneration and Nomination Committee for the Establishment of the SEVP 40. 02 July 2020 SB.41/DK/01.22/01/05/2020 Fulfillment of Financing Documents and Information to Daphne Desire Voges Debtors 41. 07 July 2020 SB.42/DK/01.22/64/07/2020 Progress of Preparation of Fit and Proper Test for Candidates for Management and Candidates for DPS Bank NTBS 42. 15 July 2020 SB.43/DK/01.22/64/07/2020 Follow up on OJK Letter Number S-514 / KO.0801 / 2020 43. 20 July 2020 SB.45/DK/01.22/64/07/2020 Study of Compliance and Risk Management of SEVP Establishment 44. 23 July 2020 SB.47/DK/01.22/64/07/2020 Funding to the Regional Government of West Lombok Regency as a Related Party 45. 22 July 2020 SB.48/DK/01.22/64/07/2020 Organizational Structure Adjustments 46. 30 July 2020 SB.50/DK/01.22/01/07/2020 PT Bank NTB Syariah SMT I 2020 Draft of Self-Assessment Report on GCG Implementation 47. 12 August 2020 SB.51/DK/01.22/90/08/2020 Report on the Supervision of the Business Plan for semester I of 2020 48. 12 August 2020 SB.52/DK/01.22/64/08/2020 Decree of the Board of Directors regarding the Authority for Borrowing money, pawning, pledging or in other ways to account for the assets of PT Bank NTB Syariah 49. 18 August 2020 SB.53/DK/01.22/64/08/2020 Self-Assessment Report on the Implementation of Integrated Governance for the First Semester of 2020 50. 18 August 2020 SB.54/DK/01.22/64/08/2020 Gathering and Coordination of the Implementation of Supervision and Advisory Functions in Accordance with the Duties of the Board of Commissioners and DPS 51. 26 August 2020 SB.055/DK-SK/1/08/2020 Guidelines and Work Procedures for the Board of Commissioners of PT Bank NTB Syariah 52. 01 September 2020 SB.57/DK/01.22/64/09/2020 Ownership Composition of Bank NTB Syariah 53. 14 September 2020 SB.58/DK/01.22/64/09/2020 Additional Explanation of the 2020 Semester I Business Plan Supervision Report 54. 14 September 2020 SB.62/DK/01.22/64/09/2020 Determination of an Independent Party as a Member of the Audit Committee and an Independent Party for a Member of the Risk Monitoring Committee of PT Bank NTB Syariah 55. 05 October 2020 SB.63/DK/01.22/01/10/2020 Approval of the Company Guidelines on PT Bank NTB Syariah Financing Restructuring 56. 05 October 2020 SB.64/DK/01.22/64/10/2020 Approval of Sharia Securities Management Policy 303 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  305. No Date Reference Number Subject 57 . 07 October 2020 SB.65/DK/01.22/64/10/2020 Application to Become a Participating Bank in Bank Indonesia Sharia Monetary Operations 58. 06 October 2020 SB.66/DK/01.22/64/10/2020 Approval of Extension of Investment Financing Cooperation received by BPKH 59. 21 October 2020 SB.69/DK/01.22/01/10/2020 Improvement of the Quality of Operational Risk Management Implementation and compliance Risk 60. 09 November 2020 SB.74/DK/01.22/01/11/2020 Progress of Fulfillment of Commitment to Follow Up on Audit Results 61. 18 November 2020 SB.76/DK/01.22/01/06/2020 Approval of PT Bank NTB Syariah RBB 2021-2023 and PT Bank NTB Syariah RAKB 62. 27 November 2020 SB.77/DK/01.22/64/11/2020 Changes in the Organizational Structure of PT Bank NTB Syariah 63. 08 December 2020 SB.78/DK/01.22/01/12/2020 Funding to the Dea Mas Foundation as a Related Party 64. 08 December 2020 SB.79/DK/01.22/01/12/2020 Results of the Meeting of the Chairman of the NTB OJK and the President Commissioner of Bank NTB Syariah 65. 23 December 2020 SB.80/DK/01.22/64/12/2020 Fulfillment of PT Bank NTB Syariah Core Capital According to POJK Number 12 / POJK.03 / 2020 PERFORMANCE ASSESSMENTS OF THE BOARD OF COMMISSIONERS The performance evaluation of the Board of Commissioners is carried out through the following procedures or mechanisms : 1. Assessment by the Annual RUPS The performance evaluation of the Board of Commissioners is reflected in the results of the General Meeting of Shareholders who have accepted management responsibilities and relinquished management from past management responsibilities. Then it means that the RUPS has provided an assessment of the implementation of the Board of Commissioners' supervision. 2. Assessment based on GCG Self Assessment The performance evaluation of the Board of Commissioners is also carried out through GCG Self Assessment submitted to OJK based on OJK Circular Letter Number: 10 / SEOJK.03 / 2014 concerning Rating of Soundness of Sharia Commercial Banks and Sharia Business Units. The GCG Self Assessment is conducted periodically every semester which is reported to the OJK for approval. PROCEDURE FOR IMPLEMENTING THE PERFORMANCE EVALUATION OF THE BOARD OF COMMISSIONERS THE PARTY CONDUCTING THE PERFORMANCE EVALUATION OF THE BOARD OF COMMISSIONERS The Board of Commissioners' performance assessment is included in the Bank's GCG Self Assessment which is conducted regularly every semester. The parties conducting GCG Self Assessment are the Directors and Board of Commissioners who must obtain approval and supervision from the OJK. PROCEDURE FOR IMPLEMENTING THE PERFORMANCE EVALUATION OF THE BOARD OF COMMISSIONERS BOARD OF COMMISSIONERS PERFORMANCE APPRAISAL RESULTS The Board of Commissioners Self Assessment Criteria related to GCG implementation is divided into 3 (three) groups, namely Governance Structure, Governance Process, and Governance Outcome. Spirit of Amanah, Optimistic and Growth in Sustainable Business The results of the 2020 Syariah GCG Implementation Self Assessment in Bank NTB Syariah, ranked 2 or Good. PT Bank NTB Syariah. 2020 Annual Report 304
  306. Good Corporate G ove r n a n c e PERFORMANCE ASSESSMENTS OF COMMITTEES BELOW THE BOARD OF COMMISSIONERS AND THE BASIS OF THE ASSESSMENTS To enhance the role of the Board of Commissioners in carrying out the supervisory function , the Board of Commissioners has formed 3 (three) Committees, namely: 1. Audit Committee 2. Risk Monitoring Committee 3. Remuneration and Nomination Committee The Audit Committee has the duty and responsibility to assist the Board of Commissioners in supervising the Bank, especially in carrying out its duties and oversight functions on matters relating to financial information, the internal control system (Internal Control System), and the audit effectiveness of internal and external auditors. Throughout 2020, the Audit Committee has carried out its duties and responsibilities well. Based on its assessment that the Audit Committee has conducted 34 (Thirty-four) meetings and carried out its duties including: 1. Discussing the results of the KAP Examination for Financial Year 2020. 2. Evaluating the Performance of Bank NTB Syariah in 2020. 3. Discussing PT Bank NTB Syariah's Sustainable Financial Action Plan (RAKB). The Risk Monitoring Committee has the duty and responsibility to help the Board of Directors related to Bank risk management. During 2020, the Risk Monitoring Committee has carried out its duties and responsibilities well. Based on its assessment that the Risk Monitoring Committee has conducted 35 (Thirty - five) meetings and carried out its duties including: 1. Evaluating the Risk Management Policies 2. Evaluating the Risk Management Implementation 3. Evaluating the implementation of duties of the Risk Management Committee and the Risk Management Work Unit The Remuneration and Nomination Committee has the duty and responsibility to assist the Board of Commissioners in carrying out the fields related to remuneration and nomination of members of the Board of Directors and the Board of Commissioners. Throughout 2020, the Remuneration and Nomination Committee has carried out its duties and responsibilities well. Based on the assessment that the Remuneration and Nomination Committee has held 5 meetings and carried out its duties, among others, to conduct an assessment of the Management Candidates of PT Bank NTB Syariah with the elements assessed; aspects of competency, aspects of integrity, managerial skills and control, independence and others for each candidate approved by the Board of Commissioners. MECHANISM OF SELF-RESIGNATION AND DISMISSAL OF THE BOARD OF COMMISSIONERS Based on the Articles of Association of Bank NTB Syariah, the Board of Commissioners has the right to resign from his position by notifying the Company in writing at least 30 (thirty) days before the date of his resignation. The position of member of the Board of Commissioners ends if: 1. Loss their Indonesian citizenship 2. Self-resignation. 3. No longer meets the requirements of the applicable legislation. 4. Passed Away. 5. Dismissed based on the decision of the General Meeting of Shareholders. 305 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  307. BOARD OF DIRECTORS The Board of Directors is the organ of the company that is collectively responsible for managing the company for the interests and purposes of the company and representing the company inside and outside the court following the provisions of the Articles of Association . The Board of Directors, in general, has to carry out all actions related to the management of the Company with restrictions as regulated in the legislation, the Articles of Association and/or the Resolution of the General Meeting of Shareholders and is accountable to the General Meeting of Shareholders. LEGAL BASIS Legal basis for the appointment of Directors: 1. Law Number 21 of 2008 concerning Sharia Banking; 2. Law Number 40 of 2007 concerning Limited Liability Companies; 3. Bank Indonesia Regulation Number: 11/3/PBI/2009 dated January 29, 2009, as amended by PBI Number: 15/13/PBI/2013 dated December 24, 2013, concerning Sharia Commercial Banks; 4. Bank Indonesia Regulation Number: 11/33/PBI/2009 dated December 7, 2009 concerning Implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units; 5. Bank Indonesia Regulation Number: 14/6/PBI/2012 dated June 18, 2012 concerning Fit and Proper Test of Sharia Banks and Sharia Business Units; 6. Financial Services Authority Regulation Number: 27/POJK.03/2016 dated July 22, 2016, concerning Assessment of Capability and Compliance for Main Parties of Financial Services Institutions; 7. Bank Indonesia Circular Number: 12/13/DPbS dated April 30, 2010, concerning the implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units; 8. Circular of Financial Services Authority Number: 10/SEOJK.03/2014 dated June 11, 2014, concerning Rating of Soundness of Sharia Commercial Banks and Sharia Business Units. GUIDELINES AND RULES FOR THE BOARD OF DIRECTORS Guidelines in carrying out the duties of the Board of Directors have been stipulated in the Decree of the Board of Directors Number: SK.01/22/64/052A/2020 dated August 3, 2020, concerning the Guidelines and Rules of Work of the Directors of PT Bank NTB Syariah. Broadly speaking, this guideline regulates the Board of Directors Charter relating to: Chapter I : General Provisions Chapter II : Duties, Powers, and Responsibilities Chapter III : Organization and Assignment of Tasks Chapter IV : General Policy Chapter V : Ethics and Working Time Chapter VI : Directors' Meeting Chapter VII : Transparency, Prohibition and Sanctions for Directors Chapter VIII : Correspondence Chapter IX : Change Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 306
  308. Good Corporate G ove r n a n c e THE TOTAL NUMBER AND COMPOSITIONS OF THE BOARD OF DIRECTORS The Board of Directors of Bank NTB Syariah consisted of 4 (Four) people, consisting of 1 (one) President Director and 3 (three) Division Directors as of 1 January 2020 – 9 March 2020 which are: Name Position H. Kukuh Rahardjo President Director H. Ferry Satrio Director of Compliance Management Hj. Baiq Dien Rosana Juwita H. Saharuddin Period GMS Decision 4 September 2018 – 4 September 2022 Decision of E-GMS on August 21, 2018 4 September 2018 – 4 September 2022 Decision of E-GMS on August 21, 2018 Director of Finance & Operational 4 September 2018 – 4 September 2022 Decision of E-GMS on August 21, 2018 Director of Funds & Services 4 September 2018 – 4 September 2022 Decision of E-GMS on August 21, 2018 & Risk The composition of the Board of Directors of the 9 March 2020 – 22 April 2020 Periods underwent amendments based on the resolutions of the RUPS on 22 April 2020, as follows: Name Position Period GMS Decision Kukuh Rahardjo President Director 4 September 2018 – 4 September 2022 Decision of E-GMS on August 21, 2018 Baiq Dien Rosana Juwita Director of Finance & Operational 4 September 2018 – 4 September 2022 Decision of E-GMS on August 21, 2018 M. Usman Director of FInancing 9 March 2020 – 9 March 2024 Decision of E-GMS on August 21, 2018 ASSESSMENTS OF DIRECTORS CAPABILITIES AND INTEGRITY The appointment of board director members is effective after obtaining approval from the Financial Services Authority for the Fit and Proper Test in accordance with the copy of the Financial Services Authority Circular Letter Number: 39 / SEOJK.03 / 2016 concerning the Fit and Proper Test for Prospective Shareholders, Prospective Members Directors, and Candidates for Members of the Board of Commissioners of the Bank. All members of the Board of Directors have passed fit and proper without records and have received approval from the Financial Services Authority, which indicates that each member of the Board of Directors has adequate integrity, competence and financial reputation. Name Position Period Passed Fit & Proper Test H. Kukuh Rahardjo Direktur Utama 4 September 2018 – 4 September 2022 No. KEP – 131/D.03/2018 dated August 8, 2018 H. Ferry Satrio Direktur Kepatuhan & Manajemen Risiko 4 September 2018 – 4 September 2022 No. KEP – 125/D.03/2089 dated August 8, 2018 Hj. Baiq Dien Rosana Juwita Direktur Keuangan & Operasional 4 September 2018 – 4 September 2022 No. KEP – 126/D.03/2018 dated August 8, 2018 H. Saharuddin Direktur Dana & Jasa 4 September 2018 – 4 September 2022 No. KEP – 123/D.03/2018 dated August 8, 2018 Muhamad Usman Direktur Pembiayaan 9 March 2020 – 9 March 2024 No. KEP – 4/D.03/2020 dated 7 January 2020 307 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  309. CRITERIA OF THE BOARD OF DIRECTORS The Board of Directors of Bank NTB Syariah must meet the criteria for meeting the Directors ' criteria to be an important point for Shareholders to gain confidence that those who will run the management of the company are truly appropriate candidates and have the qualifications under the provisions set by regulators and internal regulations. Based on Law Number 40 of 2007 concerning Limited Liability Companies, those who can be appointed as members of the Board of Directors are individuals who are capable of taking legal actions, except in the 5 (five) years before their appointment: 1. Declared bankrupt; 2. Becoming a member of the Board of Directors or a member of the Board of Commissioners found guilty of causing a Company to go bankrupt; or 3. Convicted of a criminal offense that is detrimental to the country's finances and/or related to the financial sector. A candidate for the Board of Directors must be an Indonesian citizen who meets the requirements specified in the applicable laws and regulations. A person who will be appointed as a member of the Board of Directors must meet the requirements of integrity, competency, and financial reputation. Integrity means having good character and morals, having a good reputation as long as the person concerned has the previous duties, commitment to comply with applicable laws and regulations, committing to the development of a healthy Bank and never being declared as a party who did not pass. Whereas as a competency requirement, someone who is proposed as a Board of Directors must have the competence and the majority of members of the board of directors have experience in banking as executive officers of the bank and have certification in the field of risk management, as well as having expertise in several other fields and have the ability to carry out strategic management to develop a healthy bank. In terms of reputation, a member of the board of directors has never been declared bankrupt or bankrupt a company when serving as a Director or member of the Board of Commissioners / Directors in the 5 (five) years before serving as the Bank's Board of Directors and not included in the list of bad loans. A person appointed as a Director of Bank NTB is required to undergo a fit and proper test conducted by the OJK as stipulated in the Financial Services Authority Circular Letter Number: 39/ SEOJK.03/2016 concerning the Capability and Appropriateness Assessment for Prospective Controlling Shareholders, Prospective Members of the Board of Directors, and candidates for the Board of Commissioners. Thus a Board of Directors must obtain the title of graduation in the fit and proper test conducted by the OJK. DUTIES OF THE BOARD OF DIRECTORS The function of the board of directors is as an organ of the Company, that is fully responsible for the Company management of interests and objectives for both inside and outside the court in accordance with the provisions of the Articles of Association and the prevailing laws and regulations. The duties and responsibilities of the Directors Board as stipulated in the Decree of the Board of Directors concerning the Guidelines and Work Procedures for the Board of Directors of PT Bank NTB Syariah are as follows: PRINCIPAL DUTIES OF THE DIRECTORS 1. 2. 3. Directors are fully responsible for carrying out their duties for the benefit of the company in achieving the company's goals and objectives; Each member of the Board of Directors must be in good faith and full responsibility for carrying out their duties by taking into account applicable laws and regulations; In carrying out the management of the Bank, the Board of Directors makes plans that are compiled comprehensively and systematicallyunder the applicable provisions and obtain approval from the Board of Commissioners which includes: a. Long-term Plan (Corporate Strategic Plan) for 5 (five) years which at least contains: Evaluation of the implementation of the previous RJP; Current bank position; Assumptions used in the preparation of the RJP; Determination of the objectives, strategies, policies and work programs of the RJP and the links between these elements. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 308
  310. Good Corporate G ove r n a n c e 4 . 5. 6. 7. 8. 9. b. Medium-term Work Plan or Bank Business Plan (RBB) which is made every 3 (three) years, which at least contains: Business development plans and bank organizations; Evaluation of the Bank's performance to date; Bank financial projections and assumptions used. c. Company Work Plan and Budget (RKAP) which is made annually which at least contains: Work plans detailed by the Bank's mission, business goals, business strategies, company policies, and work programs/activities; Company budgets detailed by each activity program budget; Financial projections of the Bank and its subsidiaries; Matters requiring the resolution of the RUPS. Holding and maintaining the company's bookkeeping and administration following the prevailing norms for the company; Preparing the company's organizational structure complete with the breakdown of its tasks; Carrying out other obligations under the provisions and the articles of association of the company or based on the resolution of the RUPS; Supervising work units that are under their authority; The Board of Directors forms committees to help smooth the duties of the Directors (Risk Management Committee, Financing Committee, ALCO Committee, IT Committee, HR Committee, and Risk Policy Committee); Organization, Membership, Duties, Authorities , Responsibilities and Working Mechanisms of the Committee are regulated in a separate Decree. OTHER DUTIES: 1. Implementing the principles of Good Corporate Governance in every company's business activities at all levels or levels of the company's organization; 2. Follow up audit findings and recommendations from the Bank's Internal Audit Unit, External Auditor, and the results of supervision by Bank Indonesia and/ or the Financial Services Authority; 3. Forming an Internal Audit Unit, Risk Management Unit and Committee, and Compliance Work Unit; 4. Submit the company's financial report to a public accountant for examination (audited); 5. Disclose to employees of Bank policies that are strategic in the field of employment. Strategic Policies in the human resources sector means to include policies regarding the recruitment system, promotion system, remuneration system, and the Bank's plan to improve efficiency through the reduction of employees. The disclosure must be made through a means which is known or easily accessed by the employee; 6. Deliver the responsibility for the management of the company for 1 (one) year to the GMS no later than 6 (six) months after the company's financial year is closed; 7. Provide accurate, relevant, and timely data and information to the Board of Commissioners; 8. Appointed members for the Auditor Committee, Risk Monitoring Committee, and Remuneration and Nomination Committee, to support the effectiveness of the implementation of the duties and responsibilities of the Board of Commissioners based on the resolutions of the Board of Commissioners Meeting; 9. Organizing an annual GMS and/or other GMS (extraordinary) according to the company's needs and applicable regulations; 10. The Board of Directors proposes a Public Accountant Firm / Public Accountant that will audit the Bank's Financial Statements. RIGHTS AND AUTHORITIES OF THE BOARD OF DIRECTORS 1. 2. 3. 4 5. 6. Appointing and dismissing employees based on the prevailing laws and regulations; The Directors Board has the right to represent the Bank inside and outside the court regarding all matters and in all cases binds the Bank with other parties and/or other parties with the Bank; The President Director is entitled and authorized for and on behalf of the Board of Directors to represent the Company. If the President Director is absent or absent for any reason, then one of the other members of the Board of Directors appointed by the decision of the Board of Directors Meeting has the right and authority to act for and on behalf of the Board of Directors to represent the Bank; The Board of Directors in written authorization can take all actions and actions to a person or several Directors or one or more Bank employees, either individually or collectively, for and on behalf of the Board of Directors representing the Bank which is regulated in a separate document; The Board of Directors for certain actions has the right to appoint one or more representatives or proxies by giving him the power regulated in a power of attorney; The authority of the Board of Directors to decide can be specifically authorized to other members of the Board of Directors, with due observance of the provisions of the Bank's Articles of Association, job description, and provisions of the Substitute Directors. 309 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  311. RESPONSIBILITIES OF BOARD OF DIRECTORS The Directors are fully responsible for : 1. Managing Bank assets following applicable laws and regulations; 2. Bank Losses: a. Each member of the Board of Directors is personally responsible for the Company's losses if the person concerned is guilty or negligent in carrying out his duties; b. Members of the Board of Directors cannot be held liable for bank losses if they can prove: The loss is not due to an error or negligence; Has conducted arrangements in good faith and prudence for the interests and by the aims and objectives of the Bank; Does not have a conflict of interest, either directly or indirectly, with management actions that result in Bank losses; Has taken action to prevent the loss arising or continuing. 3. Annual Report: a. Members of the Board of Directors and members of the Board of Commissioners are jointly and severally liable to the injured party if the financial statements provided are found to be untrue and / or misleading; b. Members of the Board of Directors and members of the Board of Commissioners are freed from the responsibilities referred to in letter a above if it is proven that the situation was not due to their mistakes. THE DIRECTORS’ BOARD APPOINTMENT The appointment of the Board of Directors has gone through a fit and proper test process following the applicable laws and regulations and the provisions of Good Corporate Governance. All members of the Board of Directors have integrity, competence, and a good reputation. THE DIRECTORS BOARD ORGANIZATION AND DISTRIBUTION OF DUTIES The bank is managed and chaired by the Board of Directors who are appointed by the General Meeting of Shareholders (GMS) or the Extraordinary General Meeting of Shareholders (EGMS) under the supervision of the Board of Commissioners. Based on the Decree of the Board of Directors Number: SK.01 / 16/64/071/2020 dated 5 September 2020 concerning the Organizational Structure and Work Procedures of PT Bank NTB Sharia, the organization and work fields of the Board of Directors of PT Bank NTB Sharia are categorized as follows: 1. H. Kukuh Rahadjo-President Director a. Dealing with work assignments that are strategic and required significant development; b. Coordinating all management activities of the Bank; c. Coordinating all activities and policies of the Bank within: The Internal Audit Unit; The Information Technology; The Human Resources; The Strategic Planning; The Company Secretary; 2. H. Saharuddin-Director of Funds and Services Coordinating all activities and policies of the Bank within: a. The Retail and Product Development Funds; b. The Treasury. 3. Hj. Baiq Dien Rosana Juwita-Director of Finance and Operations Coordinating all activities and policies of the Bank in the: a. Administration, Monitoring and Saving Financing; b. General Administration; c. Accounting and Financial Control; d. Business Risk. 4. H. Ferry Satrio-Director of Compliance & Risk Management Coordinating all activities and policies of the Bank in the: a. Obedience; b. Risk management;. 5. M. Usman – Director of Financing a. Financing; b. Network, Branch, and e-Channel Performance Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 310
  312. Ta t a Ke l o l a Pe r u s a h a a n AFFILIATES OF THE BOARD OF DIRECTORS Direksi telah mengungkapkan hubungan keuangan dan hubungan kekeluargaan baik dengan Dewan Komisaris , Direksi, maupun Pemegang Saham Pengendali yang terangkum sebagaimana tabel berikut: Finance Relationship With Nama Jabatan Board of Commissioners Yes H. Kukuh Rahardjo President Director H. Ferry Satrio Director of Management & Risk Management Hj. Baiq Dien Rosana Juwita Director of Finance & Operations H. Saharuddin Director of Funds & Services M. Usman Director of Financing No Directors Yes No Family Relationship With Board of Controlling shareholders Commissioners Yes No Yes No Directors Yes No Controlling shareholders Yes No KEPEMILIKAN SAHAM DIREKSI The Directors Board has disclosed share ownership in Bank NTB Syariah and other companies. For share ownership up to December 31, 2020, the Directors Board does not own shares with total ownership of 5% (five percent) or better in a Bank or other company, which is summarized as follows: Nama Shareholdings Jabatan Bank Other Banks Non-Bank Financial Institute Other Companies H. Kukuh Rahardjo President Director None None None None H. Ferry Satrio Director of Management & Risk Management None None None None Hj. Baiq Dien Rosana Juwita Director of Finance & Operations None None None None H. Saharuddin Director of Funds & Services None None None None M. Usman Director of Financing None None None None INDEPENDENCE OF THE BOARD OF DIRECTORS The Directors Board always acts independently, in the sense that no conflict of interest could interfere with their ability to carry out their duties independently and critically, both to each other and to the Board of Commissioners. The Directors Board has no financial relationship, management relationship, shared ownership, and/or family relationship with other members of the Board of Commissioners, Board of Directors and/or Controlling Shareholders or relationship with the Bank, therefore, they can carry out their duties and responsibilities independently. The Board of Directors does not hold concurrent positions as President Director or other Directors at State, Regional and Private Owned Enterprises or other positions related to the management of the Company, as well as structural positions, and other functional positions in central and local government agencies/institutions, as well as other positions. following the provisions of the Company's Articles of Association and other applicable laws and regulations. 311 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  313. THE DIRECTORS BOARD IMPLEMENTATION OF DUTIES AND RESPONSIBILITIES IN 2020 In 2020 , the Directors Board has carried out the management of the Company following the established company work plan which can be seen from the achievement of the Bank's targets. In carrying out the duties, such as the implementation of the board of directors’ meetings which have been held 48 times in 2020, joint meetings with the Board of Commissioners, committee meetings, and field meetings. As for the activities of the Board of Directors in 2020, an outline can be conveyed as follows: 1. In finance a. Compilation of RBB; b. Regularly updating the company's performance in 2019; 2. Governance: a. Monitoring and evaluating the implementation of GCG 3. Internal control and risk management: a. Monitoring and following up on external audit findings and suggestions; b. Conduct a discussion of the Bank's risk profile 4. HR Management: a. Make/revise/evaluate and direct HR policies b. Decide on recruitment, promotion, transfer/rotation, coaching and training of human resources 5. Corporate social responsibility: a. Carry out Corporate Social Responsibility activities MEETINGS OF THE BOARD OF DIRECTORS The Directors Board meeting must be held at least once a month to ensure the progress and smoothen the run of the Company. The regulations and requirements regarding Directors' meetings have been regulated and are following the prevailing laws and regulations, in particular Bank Indonesia Regulation Number: 11/33 / PBI / 2009 concerning the Implementation of Good Corporate Governance for Sharia Commercial Banks. AGENDA, DATE, AND PARTICIPANTS OF THE BOARD OF DIRECTORS MEETINGS Throughout 2020, the agenda, dates and participants of the Board of Directors Meeting are as follows: No Date Main Meeting Agendas Participant 1. 12 February 2020 Exit Meeting with KAP BDO Directors, GM, DH & KAP BDO 2. 13 February 2020 Meeting with the National Code Agency Directors, GM, DH & the National Code Agency Staff 3. 21 February 2020 Dismissal Decree Disssussion Directors, GM & DH 4. 26 February 2020 Directors Board panel regarding employee salary adjustment Directors, GM & DH 5. 27 February 2020 Visiting of Commission I Regional Assembly of. Central Kalimantan & Central Kalimantan Bank Directors, Central Bank Director & Commission I DPRD Kalimantan. 6. 20 March 2020 Key Performance Indikator (KPI) Presentation of PT. Bank NTB Sharia Directors Board, GM & DH 7. 01 April 2020 Restructrisastion SOP Directors Board, GM PBY,KEP, TSI, JKE, Desk APP, Desk MJR, APP KC Tanjung 8. 4 May 2020 NTB Bank Retirement Funds Performance Meeting Directors & Retirement Member 9. 6 May 2020 General Restructrisastion SOP Directors Board, GM, DH, BM BO K.Jangkong 10. 15 May 2020 Mataram Municipality Regional Assembly Visit Directors, GM & Mataram Municipality Regional Assembly Member Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 312
  314. Ta t a Ke l o l a Pe r u s a h a a n No Date Main Meeting Agendas Participant 11 . 17 May 2020 Special Scheme small-medium enterprise Financing Meeting during the Covid-19 Pandemic Directors Board, GM, DH, BM KC Pejanggik & Jamkrindo Sharia 12. 20 May 2020 Meeting with Baznas Prov. NTB with the Board of Directors of NTB Bank Directors Board, GM DH, BM KC Pejanggik & Jamkrindo Sharia 13. 11 June 2020 Discussion on BBP Amendments for 2020-2022 Directors Board, GM & DH 14. 16 June 2020 Video Conference with KPK "Optimizing Regional Revenue from BUMD in NTB Province Dekom, Directors Board , GM & DH 15. 08 July 2020 Discussion on the Revised Business Plan of Bank NTB Sharia with FSA/ PT Bank NTB Sharia Prudential Meeting Dekom, Directors Board , GM & DH 16. 17 July 2020 Briefing for Internship Preparation for Tazkia Islamic University Collage Students Directors Board, GM, DH, dan Interen 17. 23 July 2020 Risk Management Committee Discussion of Pejanggik Officials Financing Documents Directors Board, Div PBY, GM JKE, GM KEP, SPI, Desk MJR & KC Pejanggik 18. 24 July 2020 Zoom Video BPKH Directors Board, Div TRS, Div TSI, Div Pby, Div DNR, Div APK 19. 24 July 2020 Establishment of a Sharia Cooperative in Bank NTB Sharia Directors Board, GM JKE, GM DNR, GM Kepatuhan, GM SPI, GM TRS, GM SDI, Div REN, General GM, GM TSI, Retirement Fund, and Cooperative member 20. 10 August 2020 2020 FSA General Examination Entry Meeting Directors Board, Commissioner, GM JKE, GM DNR, Proper GM, GM SPI, DGM TRS, DGM SDI, Div REN, GENERAL GM, GM TSI, DGM APK, GM PBY, Desk APP, Desk RBN, Desk MJR, BM KC Pejanggik 21. 24 August 2020 Entry Meeting with Indonesian Audit Board (IAB) NTB Representatives Directors Board, GM JKE, GM DNR, Proper GM, GM SPI, GM TRS, GM SDI, Div REN, GENERAL GM, GM TSI, GM APK, DGM PBY, Desk APP, Desk RBN, Desk MJR, DBM KC Pejanggik, and Head of IAB NTB representatives and Team 22. 24 August 2020 Discussion on Pending Performance Directors Board, DGM JKE, GM DNR, Proper GM, GM SPI, GM TRS, DGM SDI, Div REN, GENERAL GM, GM TSI,GM APK, DGM PBY, Desk APP, Desk RBN, Desk MJR, SEP 23. 27 August 2020 BPD South Kalimantan Visit Directors Board, Div TSI, Div Pby, Div DNR, DivAPK, and Team BPD Central Kalimantan 24. 4 September 2020 Internal Discussion on Findings of the 2020 FSA Examination Results Directors Board, DGM JKE, GM DNR, Proper GM, Div SPI, GM TRS, GM SDI, Div REN, GENERAL GM, GM TSI,GM APK, Div PBY, Desk APP, Desk RBN, Desk MJR, SEP, BM KC Sriwijaya, BM KC Selong 25. 5 September 2020 Discussion on FSA Examination Results Directors Board, DGM JKE, GM DNR, Proper GM, Div SPI, GM TRS, GM SDI, Div REN, GENERAL GM, GM TSI,GM APK, DGM PBY, Desk APP, Desk RBN, Desk MJR, SEP, BM KC Pejanggik 313 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  315. No Date Main Meeting Agendas Participant 26 . 9 September 2020 Exit Meeting with FSA Directors Board, Commissioner, DGM JKE, GM DNR, Proper GM, Div SPI, GM TRS, GM SDI, Div REN, GENERAL GM, GM TSI,GM APK, DGM PBY, Desk APP, Desk RBN, Desk MJR, SEP, DBM KC Pejanggik, BM KC Selong Pahlawan, KC Sriwijaya, Auditing Comitee 27. 02 October 2020 Prudential Meeting with FSA Directors Board, Commissioner, DGM JKE, GM DNR, Proper GM , Div SPI, GM TRS, GM SDI, Div REN, GENERAL GM , GM TSI,GM APK, DGM PBY, Desk APP, Desk RBN, Desk MJR, SEP, DBM KC Pejanggik, BM KC Selong Pahlawan, KC Sriwijaya, Auditing Comitee 28. 07 October 2020 The signing of the Masterplan Agreement / Contract and DED, BNTBS Head Office Building Directors Board, Commissioner, GM DNR, Proper GM, GM JKE, Div SPI, GM TRS, GM SDI, Div REN, GENERAL GM , GM TSI,GM APK, DGM PBY, Desk APP, Desk RBN, Desk MJR, SEP, Karo APP LPBJ NTB, PT YODYA KARYA, POKJA,PDC RANCANG PERSADA. 29. 08 October 2020 High-Level DOW in the Context of Waqf Week "Akserrelation of the Waqf Movement Towards Advanced Indonesia Directors Board, Div DNR, DGM JKE, SEP 30. 22 October 2020 Internal Discussion on the Findings of the 2019 and 2020 IAB TB Examination Results Directors Board, General Div, DGM JKE, GM TRS, Desk APP, Div DNR, Div SPI, Div PBY, Desk SEP, KC Selong Pahlawan, KC Praya, KC Pancor, KC Tanjung 31. 23 October 2020 Discussion on the Findings of the General Audit Results of the IAB Representatives of NTB in 2021 Directors Board, Div JKE, GENERAL GM,GM Kepatuhan, Div PBY, Div SPI, Div PBY, Desk SEP, Desk APP, Desk MJR, BPK RI NTB, KC Pejanggik 32. 07 December 2020 Micro Waqf Bank Presentations Directors Board, Div JKE, General GM, Proper GM, Div PBY, Div SPI, Div PBY,Div Ren, Div TSI Desk SEP, Desk APP, Desk MJR, DPS, and BWI 33. 07 December 2020 The Peak of the 2020 Nusantara Awards Directors Board, Div TSI, Div Ren 34. 08 December 2020 Discussion on the Action Plan on the Findings of the IAB Audit Results for the 2019 Fiscal Year Directors Board, Div JKE, General Div, Proper GM, Div PBY, Div SPI, Div PBY, Div TSI, Div TRS, Desk SEP, Desk APP, Desk MJR 35. 10 December 2020 Exit Meeting Audit BNTBS Praya Branch Office Directors Board, Div SPI, General Div, Div JKE, Div PBY, Div SPI, Div DNR, Div TSI, Div TRS, Desk SEP, Desk APP, Desk MJR 36. 11 December 2020 Submission of IAB Audit Results Reports on the 2019 and 2020 BNTBS TB Operations Directors Board, Commissioner, DPS Chairman, Div SPI FREQUENCIES AND ATTENDANCES OF THE MEETINGS In 2020, the Directors Board of Bank NTB Sharia held 19 Board of Directors Meetings and 14 Joint Meetings with the Board of Commissioners and the Sharia Supervisory Board. Meeting attendance during 2020 is described as follows: Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 314
  316. Ta t a Ke l o l a Pe r u s a h a a n Name Number of Meetings Number of Attendance Directors Meeting Joint Meeting Percentage (%) Total H. Kukuh Rahardjo 48 27 12 39 81.25% Hj. Baiq Dien Rosana Juwita 48 31 12 43 89.58% H. Ferry Satrio*) 13 8 5 13 100.00% H. Saharuddin*) 13 8 5 13 100.00% M. Usman 43 27 9 36 83.72% *) Per the decision of the GMS on April 22, 2020, Mr. H. Ferry Satrio and Mr. H. Saharuddin have ended their term of office. COMPETENCY DEVELOPMENTS OF THEBOARD OF DIRECTORS Throughout 2020, members of the Company's Board of Directors have participated in various competency improvement programs in the form of training, workshops, conferences, seminars and have been submitted in the Company Profile Chapter. Nama IMPLEMENTATIONS OF RISK MANAGEMENT CERTIFICATIONS In addition to the competency improvement program, the Board of Directors also participates in the Risk Management Certification program. In the 2020 period, directors who have passed the risk management certification are as follows: Name Position Risk Management Certification H. Kukuh Rahardjo President Director Level V H. Ferry Satrio Director of Compliance & Risk Management Level IV Hj. Baiq Dien Rosana Juwita Director of Finance and Operations Level IV H. Saharuddin Director of Funds and Services Level V M. Usman Director of Financing Level V BOARD OF DIRECTORS REMUNERATION POLICIES The Directors Board Remuneration Policy refers to the Articles of Association of the Bank, which stipulates that members of the Board of Directors can be given salaries and allowances using a single salary system. The components of the remuneration and the nominal amount received by the Board of Directors are as follows: Nominal Amount/Component of The Board of Directors Remuneration Total Amount Received in 1 Year Types of Remuneration and Other Facilities Remuneration (salary, routine benefits, bonuses, and other facilities in the form of non-benefits) Other facilities in kind (housing, transportation, health insurance, etc.) which: a. Can be owned b. Cannot be owned Total 315 PT Bank NTB Syariah. 2020 Annual Report Members 5 Amount (Rp) 2.242.500.000 3 8 2.242.500.000 Spirit of Amanah, Optimistic and Growth in Sustainable Business
  317. Table of Group of Directors ' Remuneration Amount Amount/Remuneration per Person in 1 Year Members Above Rp2 billion - Above Rp1 billion - Above Rp500 million to 1 billion 3 Rp500 million and below 2 PERFORMANCE ASSESSMENTS OF THE BOARD OF DIRECTORS The performance evaluation of the Directors is carried out through the following procedures or mechanisms: 1. Assessment by the Annual GMS The performance evaluation of the Board of Directors is reflected in the results of the General Meeting of Shareholders who have accepted management responsibilities and relinquished management from past management responsibilities. Then it means that the GMS has provided an assessment of the implementation of the Board of Directors' Performance. 2. Assessment based on GCG Self Assessment The performance evaluation of the Directors is also carried out through GCG Self Assessment submitted to the OJK based on the OJK Circular Letter Number: 10/SEOJK.03/2014 concerning the Rating of Sharia Commercial Banks and Sharia Business Units. The GCG Self Assessment is conducted periodically every semester which is reported to the OJK for approval. PROCEDURE FOR IMPLEMENTING DIRECTOR’S PERFORMANCE APPRAISAL PARTIES CONDUCTING DIRECTOR’S PERFORMANCE EVALUATION The Board of Director's performance assessment is included in the Bank's GCG Self Assessment which is conducted regularly every semester. The parties conducting GCG Self Assessment are the Directors and Board of Commissioners who must obtain approval and supervision from the OJK. CRITERIA FOR APPRAISAL OF DIRECTOR'S PERFORMANCE DIRECTORS PERFORMANCE ASSESSMENT RESULTS Directors' Self Assessment Criteria related to GCG implementation are divided into 3 (three) groups, namely Governance Structure, Governance Process, and Governance Outcome. The results of the Self-Assessment of GCG Implementation in 2020 Bank NTB Syariah, ranked 2 or GOOD. MECHANISM OF SELF RESIGNATION AND DISMISSAL OF THE BOARD OF DIRECTORS Based on the Articles of Association of Bank NTB Syariah, the Board of Commissioners has the right to resign from his position by notifying the Company in writing at least 30 (thirty) days before the date of his resignation.. The position of member of the Board of Commissioners ends if: 1. Loss their Indonesian citizenship. 2. Self-resignation. 3. No longer meets the requirements of the applicable legislation. 4. Passed Away. 5. Dismissed based on the decision of the General Meeting of Shareholders. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 316
  318. Ta t a Ke l o l a Pe r u s a h a a n ORGANS AND COMMITTEES UNDER THE BOARD OF COMMISSIONERS SECRETARY OF BOARD OF COMMISSIONERS The Board of Commissioners of Bank NTB Syariah has a Board of Commissioners Secretary (Sekdekom) who is appointed and terminated by and is responsible to the Board of Commissioners. The Secretary of the Board of Commissioners of Bank NTB Syariah has to carry out the secretarial duties of the Board of Commissioners. DUTIES AND RESPONSIBILITIES 1. The Secretary of the Board of Commissioners is obliged to: a. Assist the Board of Commissioners in maintaining that the Commissioner's code of conduct is technically carried out properly. b. Prepare a meeting invitation for all participants to be signed by the President Commissioner or one of the other Commissioners. c. Prepare the infrastructure needed in the meeting. d. Distributing meeting materials to all meeting participants. e. Record and administer meeting decisions. f. Save the draft minutes of meetings. g. Maintain the confidentiality of meeting decisions until decisions are announced. h. Delivered minutes of meeting to all members of the meeting and other officials determined at the Meeting of the Board of Commissioners. i. Make notes and monitor follow-up developments in the implementation of meeting decisions and report the follow-up to the Board of Commissioners. 2. The Secretary of the Board of Commissioners is obliged to maintain the security of all meeting documents, especially those that are confidential EXECUTIVE SECRETARY OF BOARD OF COMMISSIONERS PROFILE L. IBNURUSD AL-HAFIED Experiences Legal Basis for Appointment 1. UUS Division Network Development Officer 2012-2019. Appointment Letter of 2. JPL Product and Network Division Officer 2010-2012. September 24, 2018 3. Corporate Secretary Desk Work Unit for the period 2008-2010. 4. Pancor Sharia Branch Office Unit for the period 2006-2008. 5 TSI divisions work unit periode 2004-2006 Share Ownership of PT Bank NTB Syariah None DEVELOPMENT OF THE COMPETENCY OF THE BOARD OF COMMISSIONERS: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. Funding Officer Training, LPPI, 17-20 February 2011; Training of SDP Batch I, LPPI, May 28 - June 16, 2012; Training on Financing Analysis of Islamic Bank, LPPI, I 10 - 21 September 2013; Financing Strategy Training of Islamic Bank, LPPI, 3 - 5 December 2015; Level 1 Risk Management Certification, BNSP, 10 December 2016; First Line Manager Training, LPPI, 22 - 31 August 2017; Executive Overview of Islamic Bank Training, LPPI, February 6 - 7, 2019; Finance for Non-Finance Training, Spectra, March 14-15, 2019; PSAK 71 Risk Management Seminar, FKDK, 29 - 30 August 2019; International Seminar on Business and Islamic Banking, ICFBB, 21 - 23 October 2019; Training of Sharia Supervisory Board, DSN-MUI Institute, 9 - 11 December 2019. Level 2 Banking Risk Management Certification by the Banking Professional Certification Institute (LSPP). Jakarta, March 7, 2020; Fraud Financial Institution Workshop by RMG and FKDK East region. Makassar, December 2, 2020. 317 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  319. THE IMPLEMENTATION OF THE SECRETARY OF THE BOARD OF COMMISSIONERS IN 2 2020 The implementation of the duties of the Secretary of the Board of Commissioners in 2020 is as follows : 1. Propose material for discussion of meetings of the Board of Commissioners with the Directors and related Divisions under the 2. directorate; 3. Ensuring the availability of Board of Commissioners meeting materials; 4. Making minutes of meetings of the Board of Commissioners with the Directors and SEP; 5. Following up on the results of the meeting and disposition of the Board of Commissioners for incoming documents addressed to the Board of Commissioners; 6. Making the presentation material of the Board of Commissioners both to be submitted internally and externally; AUDIT COMMITTEE COMMITTEE GUIDELINES To carry out good corporate governance, the Commissioners have formed an Audit Committee, a Risk Monitoring Committee and a Remuneration & Nomination Committee. The establishment of the Audit Committee is guided by Bank Indonesia Regulation Number: 11/33/PBI/2009 dated December 7, 2009 and Bank Indonesia Circular Letter Number: 15/15/DPNP dated April 29, 2010 concerning Implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units. The Guidelines and Rules of Work of the Audit Committee of PT Bank NTB Syariah have been regulated based on the Decree of the Board of Commissioners of PT Bank NTB Syariah Number: SK.02/DK/01.22/09/2018 dated September 25, 2018. The Audit Committee collectively has competence and experience in the field of accounting, finance, and banking. All committee members are independent of the Directors and External Auditors. The Audit Committee reports its activities to the Board of Commissioners. ORGANIZATION STRUCTURES OF THE AUDIT COMMITTEE The Audit Committee consists of 6 (six) members, namely 2 commissioners, and 4 independent parties. Independent President Commissioner acts as Chairman of Audit Committee and 1 Commissioner and 4 independent parties are members of the Audit Committee. However, as of October 1st, 2020 there were changes in the members of the Auditor Committee. Audit Committee consists of 5 people, namely 2 commissioners, and 3 independent parties. Independent President Commissioner acts as Chairman of the Audit Committee and 1 Commissioner and 3 independent parties are members of the Auditor Committee. Based on the Decree of the Board of Directors of PT. Bank NTB Sharia Number: SK / 01.12 / 64/830/2019, which is valid until September 30th, 2020, the structure of the Audit Committee consists of: Spirit of Amanah, Optimistic and Growth in Sustainable Business Chairman: H. Zainal Fanani/Independent President Commissioner Member : 1. H. Muhammad Nur/Commissioner 2. Refreandi Haeri/Independent Party 3. H. Lalu Badaruddin/Pihak Independen 4. Bambang/Pihak Independen 5. Iwan Triadi Agustono/Pihak Independen Based on the Decree of the Board of Directors of PT. Bank NTB Syariah Number: SK / 01.12 / 64/958/2020 on October 1, 2020, the structure of the Audit Committee consists of: Chairman: H. Zainal Fanani/Independent President Commissioner Member : 1. H. Muhammad Nur/Commissioner 2. Refreandi Haeri/Independent Party 3. H. Lalu Badaruddin/Pihak Independen 4. Bambang/Pihak Independen MEMBERSHIPS, EXPERTISES, INDEPENDENCES OF THE AUDIT COMMITTEE 1. 2. 3. 4. 5. 6. Integrity and good financial reputation; Has expertise in financial accounting and sharia banking; Is not a person in a Public Accountant Office, Legal Consultant Office, or other party providing audit services, non-audit services, or other consulting services to the Company within the last 6 (six) months before being appointed by the Commissioners; Not a person who has the authority and responsibility to plan, lead or control the activities of the Company within the last 6 (six) months before being appointed by the Commissioners, except for Independent Commissioners; Has no affiliation with the Company, Commissioners, Directors or Major Shareholders of the Company; Does not have: (1) Family relations due to marriage and descent to the second degree, both horizontally and vertically with the Commissioners, Directors, or Major Shareholders of the Company, and/or; (2) Business relations, directly or indirectly, related to the Company's business. PT Bank NTB Syariah. 2020 Annual Report 318
  320. Ta t a Ke l o l a Pe r u s a h a a n COMPOSITIONS OF THE AUDIT COMMITTEES MAIN DUTIES 1 . Decree of the Directors Board Number: SK/01.12/64/830/2019 dated 01 October 2019, and Decree of the Directors Board Number: SK/01.12/64/958/2020 dated 01 October 2020 about the appointment of Members of the Audit Committee, Risk Monitoring Committee and Remuneration Committee and Nominations for Bank NTB Syariah, Composition of the Audit Committee as of 31 December 2020 as follows: 1. Decree of the Directors Board Number: SK/01.12/64/830/2019 dated 01 October 2019. No Name Position 1. H. Zainal Fanani Chairman 2. H. Muhammad Nur Member 3. Refreandi Haeri Member 4. H. Lalu Badaruddin Member 5. Bambang Member 6. Iwan Triadi Agustono Member 2. Decree of the Board of Directors Number: SK/01.12/64/958/2020 dated 01 October 2020. No Nama Position Reviewing the financial information that will be issued by the company, such as financial reports, projections, and other financial information; 2. Evaluating the effectiveness of the external auditor's audit implementation, including reviewing the independence and objectivity of the external auditor and reviewing the adequacy of the audit carried out to ensure that allimportant risks have been considered; 3. Reviewing the company's compliance with other laws relating to the company's activities; 4. Monitoring and evaluating the planning and implementation of audits as well as monitoring the follow-up to audit results to assess the adequacy of internal control including the adequacy of the financial reporting process. 5. Providing recommendations regarding the appointment of Public Accountant and Public Accountant Office to the Board of Commissioners to be submitted to the General Meeting of Shareholders; 6. Reviewing and reporting to the Board of Commissioners on complaints relating to the Company; 7. Reviewing the report on GCG implementation; 8. Preparing the Audit Committee Annual Report to be published in the annual report 9. Carrying out other tasks given by the Board of Commissioners; 10. Making an audit committee work plan 1. H. Zainal Fanani Chairman 2. H. Muhammad Nur Member 3. Refreandi Haeri Member DUTY DETAILS 4. H. Lalu Badaruddin Member 1. 5. Bambang Member Regarding Public Accountant Firm/Public Accountant: a. Examining proposals for Public Accounting Firm/Public Accountant services offering; b. Examining the scope, accuracy, and effectiveness of conducting audits, independence, and objectivity of public accountants; c. Conducting periodic coordination with public accountants about the progress of audit work carried out to provide advice or bridge obstacles that arise in the implementation of tasks without affecting the independence of public accountants. 2. Related to SPI/SKAI: a. Monitoring and review the effectiveness of the Bank's internal audit; b. Evaluating the performance of the SKAI; c. Ensuring that SKAI communicates with the Board of Directors, Board of Commissioners, Sharia Supervisory Board for Sharia Commercial Banks and Conventional Commercial Banks that have sharia business units, external auditors, and the Financial Services Authority; d. Ensuring that SKAI works independently; e. Providing recommendations to the Board of Commissioners regarding the preparation of an audit plan, scope and budget for the Internal Audit Unit; f. Reviewing audit reports and ensuring that the Board of Directors takes the necessary corrective actions quickly to address control weaknesses, fraud, compliance issues with policies, laws and regulations, or other issues identified and reported by SKAI; The Audit Committee member has met the criteria of independence, expertise, integrity, and good morals required by the NTB Sharia Bank of Good Corporate Governance Guidebook and other related regulations/provisions. All members of the Audit Committee do not have financial, management, share ownership, and/or family relationships with the Board of Commissioners, Directors and/or Controlling Shareholders or relationship with the Bank, which may affect their ability to act independently. DUTIES AND RESPONSIBILITIES OF THE AUDIT COMMITTEE The Audit Committee has the following duties and responsibilities: 1. Evaluating the implementation of internal audit to assess the adequacy of internal control, including the adequacy of the financial reporting process; 2. Coordinating with the Public Accounting Firm in the context of the effectiveness of the external audit; Providing recommendations to the Board of 3. Commissioners on reports or matters submitted by the Board of Directors to the Board of Commissioners, identify issues that require the attention of the Board of Commissioners, and carry out other tasks related to the duties of the Board of Commissioners 319 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  321. g . Reviewing audit reports and ensuring that the Board of Directors takes the necessary corrective actions quickly to address control weaknesses, fraud, compliance issues with policies, laws and regulations, or other issues identified and reported by SKAI; h. Providing recommendations to the Board of Commissioners regarding the provision of SKAI annual remuneration as a whole as well as performance awards; and i. Ensuring that SKAI upholds integrity in the implementation of its duties. AUDIT COMMITTEE AUTHORITIES 1. 2. The Audit Committee has the authority to access the company's records and other records relating to the implementation of its duties; 2. In exercising authority as referred to in paragraph (1) above, the Audit Committee cooperates with SPI/SKAI. COMMITTEE PROFILE Bambang Audit Committee Member Indonesian citizen, 45 years old, was born in Simpasai (Bima) on April 11, 1975. He completed his Bachelor's Degree in Accounting at Hasanuddin University in 2000 and then continued his Masters in Accounting Masters program in 2012. Served as a Member of the Audit Committee since 2008. Also active as a permanent lecturer in the Accounting Department of Unram since 2003. Iwan Triady Agustono Audit Committee Member Indonesian citizen, 64 years old, born in Mataram, on August 7, 1956. Served as a Member of the Audit Committee since 2014. He completed his Bachelor's Degree in Management from Muhammadiyah University, Palu. A career at Bank Indonesia from 1977 to 2012, most recently served as Deputy Chief Representative of Bank Indonesia, NTB Province. Refreandi Haeri Audit Committee Member Indonesian citizen, 39 years old, was born in Central Lombok on April 7, 1981, as a member of the audit committee since 2019. He completed his Bachelor's degree in Accounting from the Merdeka University of Malang in 2005 and then continued his postgraduate (S2) Masters in Accounting at the Mataram University. 2014. Also Active as Lecturer at Qamarul Huda Badaruddin University and Mataram State Islamic University, Chairperson of the Department of Accounting Research Development of the Association of Indonesian Islamic Economics West Nusa Tenggara. H. Lalu Badaruddin Audit Committee Member Indonesian citizen, 57 years old, born in Karang Jangkong Mataram, on January 1, 1963. He has been serving as the Audit Committee since 2020. Completed his undergraduate education at the Faculty of Agriculture, Mataram University in 1987 and the Postgraduate Program (S2), Department of Management in 2003. Starting career at BPD NTB in 1988 through a recruitment program. Several strategic positions have been entrusted, among others, Head of the Karang Jangkong Branch, Head of the Treasury Sub Division, Head of the Information Systems Technology Division, Head of the Network and Service Development Division and most recently as General Manager of Chanel's Branch Performance Network and Electronic Division. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 320
  322. Good Corporate G ove r n a n c e EDUCATIONS AND TRAINING IN 2020 Presented in the Company Pro file Chapter. THE INDEPENDENCE OF AUDIT COMMITTEE H. Zainal Fanani Independent Aspects H. Muhammad Nur Refreandi Haeri Bambang Iwan Triadi Agustono H. Lalu Badaruddin Has no financial relationship with the Board of Commissioners and Directors Do not have a share ownership relationship in the company Does not have family relations with the Board of Commissioners, Directors, and/or fellow Audit Committee members AUDIT COMMITTEE MEETINGS Audit Committee Meetings have been held according to the needs of the Bank and can only be held if attended by at least 51% (fifty-one percent) of the total number of members including an Independent Commissioner and an Independent Party. Based on the tasks and focus of the aforementioned activities, during 2020 the Audit Committee discussed and submitted suggestions covering a variety of important activities carried out by the Bank in 34 (thirty-four) meetings with the discussion, as follows: Date No Main Meeting Agenda Participant 1. 02 January 2020 Strengthening the function & role of the Committee for the Board of Commissioners Board of Commissioners + KA + KPR 2. 06 January 2020 Discussion on the Principles of Regulation of POJK N0-39 / POJK / 2019 concerning the Implementation of Anti-Fraud Strategies KA 3. 16 January 2020 Plans and strategies for achieving DPK business targets Board of Commissioners, DIR.DJ KA , KPR, TRS, JKE, DRP 4. 16 January 2020 Discussion on the Annual Work Program and Budget for PT Bank NTBS Internal Supervision Unit Division KA 5. 22 January 2020 Discussing KAP Audit Results with the Audit Committee KA, KAP 6. 28 January 2020 Risk Management Framework & Working Relationship between Risk Management Board of Commissioners, KA, KPR, DIRKEP, RBN 7. 29 January 2020 Presentation of the SPI th Div Work Program. 2020 Board of Commissioners, KA, KPR, SPI 8. 04 February 2020 Discussion on the Anti-Fraud Strategy SOP between SKAI and KA Members SPI, KA 9. 12 February 2020 Supervisory Report of the SMT II / 2019 Dekom KA, KPR 10. 02 March 2020 Compliance & Risk Management Discussion on the Submission of NTBS Bank Annual Publication Report KA, KPR 11. 04 March 2020 Evaluation of the Implementation of KAP and AP KAP Tasks Tanubrata Sutanto Fahmi Bambang and Partners KA 12. 08 April 2020 Evaluation of the 2019 IT Implementation Report KA, KPR 321 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  323. No Date Main Meeting Agenda 13 . 28 April 2020 Evaluation of the Report on the Fulfillment of the Follow Up on the Audit Results KA 14. 13 May 2020 Proposals from the Directors of PT Bank NTBS for Adjustment of Organizational Structure KA, KPR 15. 19 May 2020 Branch Development Strategy in developing NTBS Bank business DIRPEM,KA, KPR, PBY, APP, JKE 16. 03 June 2020 Guidelines and Implementation of Performance Management Commissioners, KA, KPR, SDI, REN 17. 08 June 2020 Study of KA on Compliance with the GMS of PT Bank NTBS Th. 2019 concerning Determination of KAP KA 18. 16 June 2020 Review of RBB Amendment KA, KPR, REN 19. 23 June 2020 Discussion on the Proposed RBB Amendment for PT Bank NTBS 2020-2022 Board of Commissioners, KA, KPR 20. 21 July 2020 Report and Follow-up on the Results of the First Semester of 2020 Board of Commissioners, KA, KPR, SPI 21. 22 July 2020 Study of Compliance and Risk Management of SEVP Establishment Board of Commissioners, KA, KPR, SDI, KEP MJR 22. 12 August 2020 Discussion on the Supervisory Report of the Board of Commissioners or Realization of the RBB SMT I Th. 2020 Board of Commissioners, KA, KPR 23. 25 August 2020 Discussion on Guidelines and Work Procedures for the Board of Commissioners of PT Bank NTB Syariah KA, KPR 24. 25 August 2020 Gathering and Coordination of the Implementation of Supervision and Advisory Functions in Accordance with the Duties of the Board of Commissioners and DPS Board of Commissioners, KA, KPR, DPS 25. 26 August 2020 Review of the Guidelines and Work Procedures for the Board of Commissioners of PT Bank NTBS Board of Commissioners, KA, KPR 26. 10 September 2020 Audit preparation by KAP BDO for the 2020 financial year KA, BDO 27. 11 September 2020 Discussion on OJK Letter Number S-643 / KO.08.01 / 2020 dated September 7, 2020 KA 28. 06 October 2020 Maximizing the Duties and Responsibilities of Committees under the Board of Committees of PT Bank NTBS Board of Commissioners, KA, KPR 29. 07 October 2020 Discussion on the Participation of Sharia NTB Bank in the Sharia Monetary Authority Board of Commissioners, KA, KPR 30. 04 November 2020 Fulfillment of Commitments to Follow Up on the Results of the 3T Capital Fulfillment Strategy Examination Board of Commissioners, KA, KPR 31. 17 November 2020 Discussion on RBB 2021-2023 and RAKB for PT Bank NTB Syariah in 2021 Board of Commissioners, KA, KPR 32. 26 November 2020 Discussion of Organizational Structure Changes Commissioners, KA, KPR, REN 33. 7 December 2020 Studies on related parties on behalf of the Dea Mas Foundation KA and KPR 34. 28 December 2020 Discussion on the PKAT Draft SPI Division 2021 Spirit of Amanah, Optimistic and Growth in Sustainable Business Participant KA and SPI PT Bank NTB Syariah. 2020 Annual Report 322
  324. Good Corporate G ove r n a n c e RISK MONITORING COMMITTEE COMMITTEE GUIDELINES The Risk Monitoring Committee is a committee formed by the Board of Commissioners , to support the Board of Commissioners in conducting oversight of the Bank's risk policies and implementation, under Bank Indonesia Basic Basis and Regulation (PBI) No. 11/33/PBI/2009 dated 7 December 2009 and SE 15/15/DPNP on April 29, 2010 concerning Implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units. The role and function of the Risk Monitoring Committee is vital to support the effectiveness of the implementation of the Board of Commissioners' functions in supervising and directing directors to the Directors, this is due to the increasingly complex banking business activities and the increasingly fierce business competition climate, each bank is required to continue to show good performance, but it must hold the principle of prudence and be able to identify all potential risks that may interfere with the business continuity of the bank. RISK MONITORING COMMITTEE ORGANIZATION STRUCTURE The Risk Monitoring Committee is a committee formed by the Board of Commissioners, to support the Board of Commissioners in conducting oversight of the Bank's risk policies and implementation, following applicable regulations: 1. Members of the Risk Monitoring Committee are appointed and dismissed by the Directors based on the decision of the Board of Commissioners meeting; 2. The Risk Monitoring Committee consists of 2 (two) Independent Commissioners and 3 (three) members from Independent Parties who have expertise in finance, risk management, and sharia banking. 3. The Risk Monitoring Committee is chaired by an Independent Commissioner. The Risk Monitoring Committee is appointed based on the Decree of the Directors of PT Bank NTB Syariah Number SK/01.12/64/830/2019 dated October 1, 2019 concerning the appointment of members of the Audit Committee, Risk Monitoring Committee and Remuneration and Nomination Committee of PT Bank NTB Syariah with the following composition: Chairman : H. Muslihun/Independent Commissioner : 1. H. Zainal Fanani/Independent President Member Commissioner 2. Susi Retna Cahyaningtyas/Independent Party 3. Kamaruddin Nur/Independent Party 4. H. Isnaedy Jauhari Djamani/Independent Party 323 PT Bank NTB Syariah. 2020 Annual Report There is a change in the organizational structure, based on the Decree of the Board of Directors of PT. Bank NTB Syariah Number: SK / 01.12 / 64/958/2020 dated 01 October 2020 concerning the appointment of members of the Audit Committee, Risk Monitoring Committee and Remuneration and Nomination Committee of PT Bank NTB Syariah with the following structure: Chairman : H. Muslihun/Independent Commissioner Member : 1. H. Zainal Fanani/Independent President Commissioner 2. Susi Retna Cahyaningtyas/Independent Party 3. H. Isnaedy Jauhari Djamani/ Independent Party 4. Ni Nyoman Sutrini Murti/ Independent Party MEMBERSHIPS, EXPERTISE, AND INDEPENDENCE OF THE RISK MONITORING COMMITTEE 1. 2. 3. 4. 5. 6. 7. 8. The Risk Monitoring Committee is appointed and dismissed by the Directors based on the decision of the Board of Commissioners meeting. The Risk Monitoring Committee consists of 2 (two) Independent Commissioners and 2 (two) members from Independent Parties who have expertise in finance, risk management, and sharia banking. The Risk Monitoring Committee is chaired by an Independent Commissioner. Members of the Risk Monitoring Committee shall at least consist of: a. An Independent Commissioner; b. An Independent Party who has expertise in finance; and c. An Independent Party who has expertise in the field of risk management. Members of the Risk Monitoring Committee must have integrity, character and good morals. Members of the Board of Directors are prohibited from becoming members of the Risk Monitoring Committee. Independent Commissioners and Independent Parties who are members of the Risk Monitoring Committee at least 51% (fifty percent) of the total members of the Risk Monitoring Committee. The Risk Monitoring Committee has a working relationship and has responsible to the Board of Commissioners. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  325. RISK MONITORING COMMITTEE COMPOSITIONS Membership of the Risk Monitoring Committee of PT Bank NTB 2019 SK Directors of PT Bank NTB Syariah Number SK /01.12/64/028/2019, dated October 1, 2019, concerning the determination of members of the Audit Committee, Risk Monitoring Committee and Remuneration and Nomination Committee with the following composition: 1. Decree of the Board of Directors Number: SK/01.12/64/830/2019 dated on 01 October 2019. No Name Position 1. Muslihun Chairman 2. Zainal Fanani Member 3. Susi Retna Cahyaningtyas Member 4. Kamaruddin Nur Member 5. Isnaedy Jauhari Djamani Member 2. Decree of the Board of Directors Number: SK/01.12/64/958/2020 dated on 01 October 2020. No Name Position 1. Muslihun Chairman 2. Zainal Fanani Member 3. Susi Retna Cahyaningtyas Member 4. Isnaedy Jauhari Djamani Member 5. Ni Nyoman Sutrini Murti Member DUTIES AND RESPONSIBILITIES OF THE RISK MONITORING COMMITTEE The Risk Monitoring Committee has the duties and responsibilities of at least: 1. Evaluating the suitability between risk management policies and the implementation of Bank policies; 2. Monitor and evaluate the implementation of duties of the risk management committee and risk management work unit, in order to provide recommendations to the Board of Commissioners. Main Duties: 1. Evaluating risk management policies: a. Ensure that the Bank has developed a risk appetite; b. Ensure that the Bank has established a risk tolerance / risk limit 2. Evaluating the implementation of risk management in the form of: a. PT Bank NTB Syariah risk profile; b. Integrated risk profile (conglomerate NTB); Spirit of Amanah, Optimistic and Growth in Sustainable Business c. Application of the Risk Management information system includes reports or information regarding Risk exposure; compliance with Risk Management policies and procedures as well as determination of Risk limits and the realization of Risk Management implementation compared to the target set. 3. Evaluating the implementation of the risk management committee's duties, in terms of structure, process and outcome; 4. Evaluating the implementation of duties of the risk management work unit in terms of structure, process and outcome; 5. Evaluating and monitoring the Information Technology strategic plan and Bank policies related to the use of IT; 6. Evaluating the accountability of the Board of Directors for the implementation of Risk Management in the use of Information Technology; 7. Evaluating the Bank's internal reports related to risk control; 8. Reviewing the report on the implementation of the Bank's Good Corporate Governance; 9. Carry out administrative, evaluation, and analysis activities on several Bank problems in accordance with the assignment of the Board of Commissioners, namely evaluation / review of the bank's strategic policies including: a. Internal control b. Risk management c. Obedience d. Financing and Investment e. New product f Bank Organizational Structure 10. Prepare a work plan for the Risk Monitoring Committee 11. Attending committee internal meetings, compiling minutes of committee meetings, including the Board of Commissioners; 12. Prepare an annual report by the Risk Monitoring Committee to be published in the annual report. RISK MONITORING COMMITTEE AUTHORITIES 1. 2. The Risk Monitoring Committee has the authority to access all data and / or records of other company records relating to the implementation of its duties. In exercising the powers referred to in paragraph 1 above, the Risk Monitoring Committee collaborates with the Risk Management Committee and the Risk Management Work Unit. REPORT OF RISK MONITORING COMMITTEE PROGRAM IN 2020 1. 2. The Risk Monitoring Committee evaluates the risk profile report prepared by SKMR, and Provides opinions/ suggestions in written form, but if necessary further clarification is scheduled to discuss the topic and documented in the form of meeting minutes. Monitor and evaluate the implementation of the duties of the Risk Management Committee and SKMR. The PT Bank NTB Syariah. 2020 Annual Report 324
  326. Good Corporate G ove r n a n c e 3 . The organizational structure of SKMR has been adjusted to the size and complexity of the Bank's business and the risks inherent in the Bank namely formed a Risk Management Desk under the Compliance Division. Likewise, the membership of the Risk Management Committee consists of a majority of Directors and related Executive Officers. The Risk Management Committee together with SKMR has formulated a Risk Management Policy, Risk Appetite/Risk Tolerance and Risk Limit. Every 3 months, namely March, June, September and December, SKMR prepares a Risk Profile report. Performing other tasks are given by the Board of Commissioners, including: a. Evaluate the Integrated Governance Report. b. Evaluation of Integrated Risk Profiles. c. Evaluation of Bank Soundness Reports. d. Evaluate the GCG Report. e. Evaluate the report on the implementation of the duties and responsibilities of the Compliance Director. f. Discussion of the bank's business plan and evaluation of its realization. RISK MONITORING COMMITTEE PROFILE COMMITTEE Susi Retna Cahyaningtyas Member of Risk Monitoring Committee Indonesian citizen, 50 years old, born in Kediri on December 3, 1969. She completed her sBachelor's degree majoring in Accounting at Brawijaya University Malang in 1994 then continued her Master's program in Accounting at Airlangga University Surabaya in 2007. Served as a member of the Risk Monitoring Committee since 2007. Active also as a lecturer in the accounting study program at the Faculty of Economics and Business, Mataram University. Kamaruddin Nur Member of Risk Monitoring Committee Indonesian citizen, 62 years old, born in Mataram, June 5, 1958. He completed his education in the Department of Management at Mataram University in 1984 and then continued his Master's program in Management at Hasanuddin University in 2002. Served as a member of the Risk Management Committee since 2014. A career in Bank Indonesia from 1982 until 2014 Isnaedy Jauhari Djamani Member of Risk Monitoring Committee Indonesian citizen, 57 years old, born in Mataram on February 8, 1963. Completed his undergraduate education at the Faculty of Agricultural Social Economics, Mahasaraswati University in 1992 and Postgraduate Program (S2) in Management Department at Trianandra University, Jakarta in 2003. Served as a member of the Risk Monitoring Committee since 2020. Started his career at BPD NTB in 1993 through a recruitment program. Several strategic positions have been mandated, including Branch Manager Bima, Head of the Main Branch of Pejanggik and most recently as General Manager of the Treasury Division. Ni Nyoman Sutrini Murti Member of Risk Monitoring Committee Indonesian citizen, 56 years old, born in Cakranegara Mataram on August 1, 1964. Completed his undergraduate education at the Faculty of Agriculture, Mataram University and Postgraduate Program (S2) majoring in Financial Management at Mataram University in 2006. Served as a member of the Risk Monitoring Committee since October 2020 He started his career at BPD NTB in 1990 through a recruitment program. Several strategic positions have been assigned, including Head of the Treasury Sub Division and most recently as Desk Head of Head Office Risk Management. EDUCATIONS AND TRAINING IN 2020 Has been submitted in the Company Profile Chapter 325 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  327. THE INDEPENDENCE OF RISK MONITORING COMMITTEE All members of the Risk Monitoring Committee originating from Independent Parties have no financial, management, share ownership and/or family relationship with the Board of Commissioners, Directors and/or Controlling Shareholders or relationship with the Bank, which can affect the ability to act independently. Independent Aspects H. Muslihun H. Zainal Fanani Susi Retna Cahyaningtyas Kamaruddin Isnaedy Jauhari Ni Nyoman Nur Djamani Sutrini Murti Has no financial relationship with the Board of Commissioners and Directors Do not have a share ownership relationship in the company Does not have family relations with the Board of Commissioners, Directors, and/or fellow Audit Committee members RISK MONITORING COMMITTEES MEETINGS The Risk Monitoring Committee holds meetings following the needs of its line of work as regulated in the Risk Monitoring Committee Charter. In its implementation, the Risk Monitoring Committee has held 36 (Thirty -Six) internal meeting following the requirements of the Risk Monitoring Committee's Guidelines and Working Rules, with the following discussion No Date 1. 02 January 2020 2. 16 January 2020 3. Main Meeting Agenda Participant Strengthening the function & role of the Committee for the Board of Commissioner Board of Commissioner + KA + KPR Plans and strategies for achieving DPK business targets Board of Commissioner, DIR.DJ KA , KPR, TRS, JKE, DRP 17 January 2020 Evaluation of the Implementation of Duties of the Risk Management Committee and Risk Management Work Unit Perioded 2 January to 31 December 2019 KPR 4. 27 January 2020 Self Assessment Report on GCG Implementation of PT Bank NTB Syariah Semester II th. 2019 KPR 5. 28 January 2020 Risk Management Framework & Working Relationship between Risk Management Board of Commissioner, KA, KPR, DIRKEP, RBN 6. 28 January 2020 Strengthening the Implementation of SKMR and Risk Management Committee Duties KA, KPR, RBN, KEP MJR 7. 29 January 2020 Presentation of the SPI th Div Work Program. 2020 Board of Commissioner, KA, KPR, SPI 8. 04 February 2020 Discussion on the Anti-Fraud Strategy SOP between SKAI and KA Members SPI, KA 9. 12 February 2020 Evaluation of PT Bank NTBS Risk Management Policy and Implementation for Quarter IV Period (position 31 December 2020) KPR 10. 12 February 2020 Supervisory Report of the SMT II / 2019 Dekom KA, KPR 11. 02 March 2020 Compliance & Risk Management Discussion on the Submission of NTBS Bank Annual Publication Report KA, KPR 12. 08 April 2020 Evaluation of the 2019 IT Implementation Report KA, KPR Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 326
  328. Good Corporate G ove r n a n c e Tanggal No Main Meeting Agenda Participant 13 . 28 April 2020 Evaluation of PT Bank NTBS Risk Management Policy and Implementation for Quarter 1 Period (position 31 March) 2020 KPR 14. 06 May 2020 BPP APU-PPT PT Bank NTB Syariah KPR 15. 11 May 2020 Organizational Structure Adjustments KPR 16. 13 May 2020 Proposals from the Directors of PT Bank NTBS for Adjustment of Organizational Structure KA, KPR 17. 19 May 2020 Branch Development Strategy in developing NTBS Bank business DIRPEM,KA, KPR, PBY, APP, JKE 18. 03 June 2020 Guidelines and Implementation of Performance Management Commissioner, KA, KPR, SDI, REN 19. 16 June 2020 Review of RBB Amendment KA, KPR, REN 20. 23 June 2020 Discussion on the Proposed RBB Amendment for PT Bank NTBS 2020-2022 Board of Commissioner, KA, KPR 21. 21 July 2020 Report and Follow-up on the Results of the First Semester of 2020 Board of Commissioner, KA, KPR, SPI 22. 22 July 2020 Study of Compliance and Risk Management of SEVP Establishment Board of Commissioner, KA, KPR, SDI, KEP MJR 23. 28 July 2020 Draft Report on GCG Implementation Self Assessment of PT Bank NTB Syariah SMT I TH. 2020 KPR, KA 24. 11 August 2020 Evaluation of PT Bank NTBS Risk Management Policy and Implementation for Quarter II (June position) 2020 KPR 25. 12 August 2020 Discussion on the Supervisory Report of the Board of Commissioners or Realization of the RBB SMT I Th. 2020 Board of Commissioner, KA, KPR 26. 18 August 2020 Integrated Governance Implementation Report KPR 27. 25 August 2020 Discussion on Guidelines and Work Procedures for the Board of Commissioners of PT Bank NTB Syariah KA, KPR 28. 25 August 2020 Gathering and Coordination of the Implementation of Supervision and Advisory Functions in Accordance with the Duties of the Board of Commissioners and DPS Board of Commissioner, KA, KPR, DPS 29. 26 August 2020 Review of the Guidelines and Work Procedures for the Board of Commissioners of PT Bank NTBS Board of Commissioner, KA, KPR 30. 29 September 2020 Review of Sharia Securities Management Policies KPR 31. 06 October 2020 Maximizing the Duties and Responsibilities of Committees under the Board of Committees of PT Bank NTBS Board of Commissioner, KA, KPR 32. 07 October 2020 Discussion on the Participation of Sharia NTB Bank in the Sharia Monetary Authority Board of Commissioner, KA, KPR 33. 04 November 2020 Fulfillment of Commitments to Follow Up on the Results of the 3T Capital Fulfillment Strategy Examination Board of Commissioner, KA, KPR 34. 17 November 2020 Discussion on RBB 2021-2023 and RAKB for PT Bank NTB Syariah in 2021 Board of Commissioner, KA, KPR 35. 26 November 2020 Discussion of Organizational Structure Changes Commissioner, KA, KPR, REN 7 December 2020 Studies on related parties on behalf of the Dea Mas Foundation KA and KPR 327 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  329. REALIZATION OF RISK MONITORING COMMITTEE PROGRAMS 1 . The Risk Monitoring Committee evaluates the risk profile report prepared by SKMR, and provides opinions/suggestions in written form, but if necessary further clarification is scheduled to discuss the topic and documented in the form of meeting minutes. 2. Monitor and evaluate the implementation of the duties of the Risk Management Committee and SKMR. The organizational structure of SKMR has been adjusted to the size and complexity of the Bank's business and the risks inherent in the Bank namely formed a Risk Management Desk under the Compliance Division. Likewise, the membership of the Risk Management Committee consists of a majority of Directors and related Executive Officers. The Risk Management Committee together with SKMR has formulated a Risk Management Policy, Risk Appetite/Risk Tolerance and Risk Limit. Every quarter, namely March, June, September and December, SKMR prepares a Risk Profile report. 3. Performing other tasks are given by the Board of Commissioners, including: a. Discussion of bank business plans. b. Evaluation of Bank Soundness Level and GCG. REMUNERATION AND NOMINATION COMMITTEE To conduct good corporate governance, the Commissioners have formed an Audit Committee, a Risk Monitoring Committee, and a Remuneration and Nomination Committee based on Bank Indonesia Regulation No. PBI. 11/33/PBI/2009 dated December 7, 2009 and SE 15/15/DPNP on April 29, 2010 concerning Implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units. COMMITTEE MEMBERSHIP In accordance with the Decree of the Board of Directors of PT Bank NTB Syariah Number SK / 01.12 / 64/830/2019, dated on 01 October 2019 concerning the appointment of members of the Audit Committee, Risk Monitoring Committee and Remuneration and Nomination Committee of PT Bank NTB Syariah with the following structure: No Name Position 1. H. Zainal Fanani Chairman 2. H. Muhammad Nur Member 3. H. Muslihun Member 4. L. Isnandar Pademan Member Spirit of Amanah, Optimistic and Growth in Sustainable Business DUTIES, RESPONSIBILITIES AND AUTHORITIES AND NOMINATION COMMITTEE 1. The Remuneration and Nomination Committee must carry out its duties and responsibilities independently. 2. The Remuneration and Nomination Committee must carry out its duties and responsibilities at least: a. General fields, including: 1) Assist the Board of Commissioners in providing recommendations on: a) Number of members of the Board of Commissioners and Directors; b) Structure, policies and the amount of remuneration for Executive Officers and Employees as a whole to be submitted to the Directors; c) Structure, policies and amount of remuneration for members of the Board of Commissioners' Committees. Jabatan d) Structure, policies and amount of remuneration for the Board of Commissioners, Directors, and DPS 2) Assist the Board of Commissioners in evaluating performance according to the remuneration received by each member of the Board of Commissioners, Directors, and DPS. 3) The Remuneration and Nomination Committee makes recommendations to the Board of Commissioners regarding compensation for members of the Board of Commissioners, Directors, DPS and the Board of Commissioners after their periodic appointments. 4) Carry out other tasks related to this Code given by the Board of Commissioners. PT Bank NTB Syariah. 2020 Annual Report 328
  330. Good Corporate G ove r n a n c e b . Remuneration Sector, including: 1) Evaluate the remuneration policies so that it meets the appropriateness and appropriateness and reasonable benchmarks based on: a) Consideration of the precautionary principle by considering the balance of fixed remuneration and variable remuneration; b) Bank performance and risk; c) Fairness with peer groups; d) Long-term goals and strategies of the Bank; e) Fulfillment of reserves as regulated in legislation and potential future income of the Bank. 2) Evaluate the suitability of the remuneration policy and the implementation of the remuneration policy, including: a) Remuneration policies for members of the Board of Commissioners, Directors, and DPS to be submitted to the GMS; b) Remuneration policies for Executive Officers and Employees as a whole to be submitted to the Directors. 3) Conduct periodic evaluations of the implementation of remuneration policies. 4) Develop a remuneration structure in the form of salary, honorarium, incentives, and allowances that are permanent and variable (specifically for the Board of Commissioners, they do not receive incentives to avoid conflicts of interest). 5) Evaluate the structure, policy and amount of remuneration at least 1 (one) time in 1 (one) year c. Nomination field, including: 1) Provide recommendations to the Board of Commissioners regarding the work system for the procedure of selecting and/or replacing members of the Board of Commissioners, Directors, and DPS. 2) 3. 4. Provide recommendations to the Board of Commissioners regarding prospective members of the Board of Commissioners, Directors and/or DPS. 3) Provide recommendations to the Board of Commissioners regarding candidates for Independent Parties who are members of the Committee. 4) Provide recommendations to the Board of Commissioners regarding: a) Composition of positions of members of the Board of Commissioners, Directors and/or DPS; b) Policies and criteria needed in the Nomination process; c) Performance evaluation policies for members of the Board of Commissioners, Directors, and DPS; d) System and procedures for the selection of appointments, dismissals and/or replacements of members of the Board of Commissioners, Directors, and DPS to be submitted to the GMS; e) Candidates who meet the requirements as members of the Board of Commissioners, Directors, and DPS to be submitted to the GMS; f) Candidates who qualify as Independent Parties who will become members of the Board of Commissioners Committee Assist the Board of Commissioners in evaluating the performance of members of the Board of Commissioners of the Board of Directors and DPS based on benchmarks that have been prepared as material for consideration. Provide recommendations to the Board of Commissioners regarding the capacity building program for members of the Board of Commissioners and Directors. REMUNERATION AND NOMINATION COMMITTEE MEETINGS Rapat Komite Remunerasi dan Nominasi selama ini dilaksanakan sesuai kebutuhan Bank NTB Syariah dan hanya dapat dilaksanakan apabila dihadiri oleh paling kurang 51% (lima puluh satu perseratus) dari jumlah anggota termasuk seorang Komisaris Independen dan Pejabat Eksekutif. Selama Tahun 2020, Komite Remunerasi dan Nominasi telah melakukan pembahasan dan menyampaikan saransaran yang meliputi berbagai aktifitas penting yang dilakukan oleh Bank sebanyak 7 kali rapat/pertemuan dengan rincian rapat, sebagai berikut: No Date Main Meeting Agenda 1. 10 March 2020 Mechanism of Conducting Interviews with prospective members of the Board of Commissioners and prospective members of the Sharia Supervisory Board of PT Bank NTB Syariah 2. 11 March 2020 KRN Self-Assessment of Fund and Services Director candidates, Compliance & MJR Director candidates, Sharia Supervisory Board candidates, PT Bank NTB Syariah Board of Commissioners candidates 3. 17 March 2020 Recommendations on the results of interviews / interviews with prospective members of the Board of Commissioners and prospective members of PT Bank NTB Syariah DPS 329 PT Bank NTB Syariah. 2020 Annual Report H. Zainal Fanani H. Muhammad Nur H.Muslihun L. Isnandar Pademan Spirit of Amanah, Optimistic and Growth in Sustainable Business
  331. No Date Main Meeting Agenda 4 . 17 March 2020 Adjustment of the honorarium for the Bank NTB Syariah Management and Changes in the Vehicle Rental Pattern for the Management of Bank NTB Syariah 5. 24 March 2020 Recommendations on the results of interviews/interviews with the Remuneration and Nomination Committee with prospective Members of the Board of Directors of PT Bank NTB Syariah 6. 15 April 2020 Recommendations for candidates for members of the Board of Commissioners of PT Bank NTB Syariah 7. 20 May 2020 Establishment of the Position of Senior Executive Vice President (SEVP) H. Zainal Fanani H. Muhammad Nur H.Muslihun L. Isnandar Pademan Decisions on Remuneration and Nomination Committee meetings are based on consensus agreement, if no consensus agreement takes place, decision making is based on majority votes, and all decisions of Committee meetings are binding for all Committee members. The results of the Committee meeting resolutions are outlined in minutes of the meeting signed by all Committee members present and documented. The Remuneration and Nomination Committee during 2020 has carried out the tasks of evaluating the Management Candidates of PT Bank NTB Syariah with the elements assessed; aspects of competency, aspects of integrity, managerial skills and control, independence and others for each candidate approved by the Board of Commissioners. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 330
  332. Good Corporate G ove r n a n c e ORGANS AND COMMITTEES UNDER THE BOARD OF DIRECTORS CORPORATE SECRETARY The Corporate Secretary has the duty and responsibility for publication activities concerning the Bank 's activities and maintains fairness, consistency, and transparency regarding matters related to corporate governance and corporate actions. The Corporate Secretary is also responsible for monitoring compliance with regulations and as a liaison between Bank NTB Syariah and stakeholders. The Corporate Secretary is the organ in charge of bridging the Company with stakeholders, shareholders, OJK and the community, and provides accurate, up-to-date and timely information for stakeholders to strengthen the trust given to the Company and the Company's positive image in the public. PRESIDENT DIRECTOR Desk Head Corporate Secretary Supervisor Supervisor Public Relations CSR Analyst Secretariat Executive Secretary of Board of Commissioner Sharia Supervisory Board Staff Administrative Assistant/ Secretary of the Board of Directors Administrative Assistant/ Secretary of the Board of Commisioner Administrative Assistant Public Relation Analyst Administrative Assistant DESK HEAD OF CORPORATE SECRETARY PROFILE Nur Herlina Indonesian citizen, born in Mataram on August 1, 1967, aged 53 years. Completed his undergraduate education at the Faculty of Law at Al-Azhar Mataram in 2005. Started his career at BPD NTB in 1993 through a recruitment program. Several strategic positions have been entrusted to Nur Herlina, including Deputy General Manager of Management and Services of SDI and most recently as Desk Head of the Corporate Secretary. 331 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  333. IMPLEMENTATION OF CORPORATE SECRETARY DUTIES Company Secretary in a company is a very important and strategic unit , especially in companies engaged in financial sectors, institutions, and associations: 1. Responsible for corporate promotional activities that are corporate image; 2. Responsible for customer complaints activities and reporting to related parties; 3. Responsible for Reporting Violations/Whistleblowing, as well as reporting to relevant parties; 4. Responsible for managing the company's CSR distribution activities; 5. Responsible for managing the Administration and Protocol of the Management; 6. Together with related units carry out the completion of the company's annual report. DESCRIPTION OF HUMAN RIGHTS ACTIVITIES DESK SECRETARY The goal of the Public Relations Desk of the Corporate Secretary of Bank NTB Syariah is to create, maintain and protect the reputation of the organization/company, displaying good images, this is because banking is a business of trust, so trust is the spearhead and the business' drill point in business matters. Also, public relations aim to achieve mutual understanding as to the main objective. Praise good image and supportive opinion are not we who determine but reciprocity is what we expect. The main purpose of creating a positive image is to change the negative things that are projected by the community into something positive. Communication activities of the Corporate Secretary of Bank NTB Syariah are also carried out on media such as on the website of Bank NTB Syariah and print and national media. IMPLEMENTATION OF CORPORATE SECRETARY DESK DUTIES IN 2020 During 2020, the Corporate Secretary carried out activities including: 1. Implementation Team for the 2020 Annual General Meeting of Shareholders; 2. Support the success of capital and land deposits from several Shareholders; 3. Completing CSR data on FSA requests; 4. Making Annual GMS materials for 2020; 5. Making Minutes of GMS; 6. Encouraging the improvement of a brand image through Cooperation with notaries in the drafting of company notary deeds; 7. Establish good communication with the media; 8. Making the right of reply and press release for reporting in the media; 9. Arrange the text of speeches and remarks by the Directors; 10. Supports administrators' fit & proper test administration; 11. Supports the completion of the follow-up to internal and 12. external audits; 13. As the Annual Report Compilation Team for Fiscal Year 2020; 14. Making advertisements and speech on print media; 15. Compiling minutes of management meetings; 16. Manage corporate exhibitions and branding activities; 17. Take care of the administration of CSR assistance. 18. Distribute benevolent funds for the benefit of the people. CORPORATE SECRETARY DESK COMPETENCY IMPROVEMENT PROGRAM The Corporate Secretary must have good knowledge in the fields of law, accounting, secretarial and communication. Besides being able to maintain company confidentiality related to internal information of the Bank. In supporting his duties as a corporate secretary, he has attended training to improve the competencies listed in the Company Profile Chapter. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 332
  334. Good Corporate G ove r n a n c e COMMITTEES UNDER THE BOARD OF DIRECTORS Based on the Decree of the Directors of PT Bank NTB Syariah Number : SK/01/10/64/023/2018 dated December 26, 2018, About the Committee Under the Coordination and Responsibility of the Directors of PT Bank NTB Syariah. As of December 31, 2018 the composition of several committees under the Board of Directors was as follows: 1. RISK MANAGEMENT COMMITTEE (KMR) a. Organizational Structures and Memberships of the Risk Management Committee CHAIRMAN DIRECTOR OF COMPLIANCE AND RISK MANAGEMENT SUBTITUTES CHAIRMAN SECRETARY DIRECTOR OF FINANCE AND OPERATIONS MJR DESK HEAD (RISK MANAGEMENT) MEMBER PRESIDENT DIRECTOR DIRECTOR OF FUND AND SERVICE GENERAL MANAGER DNR GENERAL MANAGER JKE GENERAL MANAGER TREASURY GENERAL MANAGER FINANCING GENERAL MANAGER APK GENERAL MANAGER UMM GENERAL MANAGER SDI GENERAL MANAGER KEP GENERAL MANAGER REN GENERAL MANAGER TSI GENERAL MANAGER SPI DESK HEAD APP b. Duties and responsibilities 1) Assist the Directors in carrying out their responsibilities related to risk management; 2) Determine the Bank's risk management plans, directives, policies, and strategies; 3) Ensuring all activities are following applicable regulations; 4) Review various credit portfolios, market risks, liquidity risks, operational risks, and significant risks and report them to the Board of Directors through risk profiles and risk exposures regularly; 5) Evaluate the implementation of the risk management process and implement improvements in line with external and internal changes that can affect the level of capital adequacy of the Bank; 6) Evaluate the organizational structure to ensure that risk management processes are following organizational development 333 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  335. c . Support Staff Organization The Support Staff of the Risk Management Committee (SSG-KMR) is a forum to assist the RI Risk Management Committee in analyzing and preparing meetings to be held, with the following Organizational Structure: CHAIRMAN DESK HEAD OF RISK MANAGEMENT MEMBER DGM OF COMPLIANCE & APU PPT DGM OF LEGAL MANAGEMENT DGM OF STRATEGIC & PLANNING DGM OF RETAIL FUNDS PRODUCT & SERVICE DEVELOPMENTS DGM OF BUSINESS DEVELOPMENT & RETAIL FUND MARKETING DGM OF MANAGEMENT & SERVICES FOR HR DGM OF RETAIL & CONSUMER DGM OF REPORT AND TAXATION DGM OF MANAGEMENT & PROCUREMENT OF GOODS & SERVICES DGM OF SETTLEMENT & FUND MANAGEMENT DGM OF TRAINING & DEVELOPMENT OF HR DGM OF GENERAL ADMINISTRATION & FIXED ASSETS DGM OF ACCOUNTING & FINANCIAL CONTROL DGM OF COMMERCIAL FINANCING FINANCING SUPERVISION & RECOVERY ADMINISTRATION HEAD DESK d. Duties and Responsibilities of SSG-KMR: 1) Helping to set the Bank's global risk goals that have been formulated by the Risk Management Committee, formulate strategies and provide guidance on managing and controlling Bank risks; 2) Helping to build a system and procedure for controlling risk that is reliable in calculating financial losses, setting risk limits for each exposure, and monitoring systems and procedures for implementing risk management strategies and policies. e. Committee Work Report During 2020, the Risk Management Committee conducted discussions and submitted suggestions covering several important activities carried out by the Bank in 2 meeting with the details of the meeting, as follows: No Date Agenda Participant 1. 23 July 2020 Discussion of Financing Documents President Director, Acting Dir. KEP, JKE, KEP, MJR, SPI, PBY, KC. Pejanggik. 2. 24 July 2020 Review Penetapan Limit Scoring terkait Lending dan Borrowing President Director, sDir. KOP, TRS, APK, MJR, PBY. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 334
  336. Good Corporate G ove r n a n c e 2 . HUMAN RESOURCES COMMITTEE a. Organizational Structures and Memberships of the Committee CHAIRMAN SUBSTITUTE CHAIRMAN DIRECTOR OF FINANCE & OPERATIONAL SECRETARY PRESIDENT DIRECTOR GENERAL MANAGER HUMAN RESOURCES MEMBER DIRECTOR OF FUNDS AND SERVICES DIRECTOR OF COMPLIANCE & RISK MANAGEMENT GENERAL MANAGER JKE GENERAL MANAGER KEP GENERAL MANAGER SPI b. Duties and Responsibilities of the Human Resources Committee: 1) Discussion of formation, employee requirements and employee recruitment of a special nature. 2) Discussion on determining Human Resource qualifications. 3) Discussion of employee coaching/sanctions (reward and punishment). 4) Discussion of strategic matters in the field of Human Resources. 5) And others deemed necessary by the Board of Directors. c. Committee Works Report During 2020, the Human Resources Committee conducted discussions and submitted suggestions which included some important activities carried out by the Bank 24 meetings with details of the meeting, as follows: No Date 1. 24 January 2020 Request for resignation of Husnul Hakiki / Ast. Administration of KC Pancor HR Committee 2. 26 March 2020 Request for resignation of Yudi Kurniawan Zahari / Ast. Administration of KC Pejanggik HR Committee 3. 26 March 2020 Request for resignation of Surya Putra Wijaya / Ast. Administration of KC Pejanggik HR Committee 4. 26 March 2020 Resignation application of Ms. Dewi Ayu Kurniasari / Prospective Analyst for Productive Financing KC Taliwang Sudirman HR Committee 5. 26 March 2020 Request for resignation of Then Raditya Panggiring / KC KC Pejanggik financing analyst HR Committee 335 PT Bank NTB Syariah. 2020 Annual Report Participant Agenda Spirit of Amanah, Optimistic and Growth in Sustainable Business
  337. No Tanggal Agenda Peserta Rapat 6 . 31 March 2020 Resignation application of Ms. Annisa Hikmayati / Ast. Aministrasi KCP Bolo HR Committee 7. 29 May 2020 Request for resignation bro. Rozin / Ast. Administration of KCP Aikmel HR Committee 8. 29 May 2020 Resignation application of Ms. Irma Datu Lastri / Ast. Administration of KCP Aikmel HR Committee 9. 17 June 2020 Resignation of employees: Sri Martini (Customer Service PT Bank NTB Syariah KCP Aikmel) HR Committee 10. 06 July 2020 Resignation of Rafika Dewi Febriani HR Committee 11. 20 July 2020 Resignation of employees: Fiska Mamona (Customer Service PT Bank NTB Syariah KCP Aikmel) HR Committee 12. 30 September 2020 Non-performing financing distribution at PT. Bank NTb syariah KCP Kediri: Siti Hudaniyah and Khatmun Nubuah HR Committee 13. 30 September 2020 The problem of replenishing ATM cash at PT Bank NTB Syariah KCP Sape HR Committee 14. 30 September 2020 Discussion of KC Bima employees: Swastono Hadi Putra / Administrative Assistant of KC Bima Sokarno Hatta HR Committee 15. 30 September 2020 Employee Development: Ivani Hendrawati / Tax Analyst HR Committee 16. 30 September 2020 Termination of Contract Employees: H. Junaidi HR Committee 17. 30 September 2020 Employee Discussion: I Gede Laken HR Committee 18. 30 September 2020 The problem of replenishing ATM cash at PT Bank NTB Syariah KCP Sape HR Committee 19. 26 October 2020 The resignation of Iqro Asmi Muttaqien HR Committee 20. 19 November 2020 The resignation of Baiq Dewi Amanda HR Committee 21. 23 November 2020 Resignation of Endra Rezkyanur HR Committee 22. 16 December 2020 Application for Resignation of Devi Arum Sari HR Committee 23. 21 December 2020 Application for Resignation of Putu Dharma Yanto HR Committee 24. 21 December 2020 Application for Resignation of Lalu Muh. Mizan Asrori HR Committee Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 336
  338. Good Corporate G ove r n a n c e 3 . ASSET LIABILITY MANAGEMENT COMMITTEE (ALMA COMMITTEE) a. Organizational Structures and Memberships of the Asset and Liabilities Management Committee CHAIRMAN PRESIDENT DIRECTOR SUBSTITUE CHAIRMAN I DIRECTOR OF FUNDS & SERVICES SECRETARY GENERAL MANAGER TREASURI SUBSTITUE CHAIRMAN II DIRECTOR OF FINANCE & OPERATIONAL ANGGOTA DIRECTOR OF COMPLIANCE & RISK MANAGEMENT GENERAL MANAGER DNR GENERAL MANAGER JKE GENERAL MANAGER PBY GENERAL MANAGER APK GENERAL MANAGER KEP GENERAL MANAGER REN GENERAL MANAGER SPI DESK HEAD MJR BRANCH MANAGER PEJANGGIK BO b. Duties and Responsibilities of the Asset and Liabilities Management Committee: 1) Reviewing reports on liquidity risk, market risk, and capital management. 2) Identifying issues in balance management that can affect the Bank's performance. 3) Conducting a review of the strategy for determining TPF expectations and profit expectations in terms of financing. 4) Reviewing the Bank's contingency plans. 5) Establishing clear, directed and measurable business policies. 6) Reviewing whether the Bank's guidelines and policies have been prepared on an ongoing basis within the scope of the ALMA following the objectives of the NTB Syariah Bank and banking developments. 7) Assessing risk and Asset Liability Management exposure, including liquidity risk, interest risk, portfolio risk (earning and investment risk). 8) Seeing forecasts and projections of the state of the economy, interest rates to direct the policies set. 9) Reviewing financing margins and financing ratios/profit sharing. 10) Setting limits and gap instruments. 11) Establishing loan limits and their distribution. 12) Determining the price of internal fund transfers (Internal Funds Transfer Rate) or inter-office account prices in spurring the efficiency of branch management. 13) Reviewing the performance and position of the Bank's wealth and financial obligations to review the results of the ALMA towards the Bank's objectives and the Bank's internal compliance and regulatory compliance. 14) Adopting strategies, limits and implementation guidelines and policies to achieve the ALMA goals and the Bank's objectives. 337 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  339. c . Organizational Structure and Staff Membership of the Asset Liability Management Committee (SSG-ALMA Committee) Supporting Group Staff The Staff Supporting Group Organization (SSG-ALMA Committee) is a forum to assist in analyzing and preparing meetings held by the ALMA Committee in managing the asset & liability management process (source and use of funds) to minimize risks. The organizational structure is as follows: CHAIRMAN DEPUTY GENERAL MANAGER TREASURY MEMBER DEPUTY GENERAL MANAGER REN DEPUTY GENERAL MANAGER PBY DEPUTY GENERAL MANAGER APK FINANCING ANALYST HEAD OFFICE DESK HEAD APP DEPUTY GENERAL MANAGER DNR d. Duties and Responsibilities of the Organization Asset Liability Committee Staff Supporting Group are as follows: 1) Helping to review and review whether the Bank's guidelines and policies have been prepared on an ongoing basis within the scope of the ALMA following the objectives of PT Bank NTB Syariah and banking developments; 2) Helping to review the structure of the balance sheet and review the risk and exposure of Asset Liability Management; 3) Helping see forecasts and projections of economic conditions, profit sharing, exchange rates, and foreign exchange to direct the policies set; 4) Helping set limits and risk management and control guidelines that have an impact on Liquidity Risk (Liquidity Risk), Profit Sharing Risk (Interest Risk), Portfolio Risk (Earning and Investment Risk); 5) Helping to review the profit-sharing of loans and fund interest; 6) Helping set limits that include secondary reverse and its instruments, limit gaps and their instruments, loan limits and their spread, pricing Internal Funds Transfer or Inter-Office Accounts (RAK) in spurring the efficiency of the management of bank branches; 7) Helping to review the performance and position of the Bank's wealth and financial obligations to assess the impact of the ALMA on the Bank's objectives and the Bank's internal compliance and regulatory compliance; 8) Helping make adjustments to strategies, limits and implementation guidelines and policies to achieve the ALMA goals and the objectives of the Bank. e. Committee Works Report During 2020, the Asset and Liabilities Management Committee conducted discussions and submitted suggestions covering various important activities carried out by the Bank in 5 meetings/meetings with details of the meeting, as follows : No Date Agenda 1. 9 September 2020 1. Calculate the Loss Given Default for each Product. 2. Refinement of internal Provisions related to Impairment Loss Allowance, particularly Loss Given Default. Pejanggik BO, PresDir, Dir. of Fund&Service, Dir. of Fin. & Opr, REN, RBN, DNR, SPI, JRL, KEP, MJR, APK, PBY, TSI, TRS. 2. 10 September 2020 1. Financial Performance of Bank NTB Syariah. 2. Determination of the yield (Counter Ratio) of other bank deposit products. 3. Fee-based income Tariff for Tambora JPP and Simpeda JPP savings. 4. Boosting Retail of Third Party Fund through Revitalization and Product Diversification of Tambora Reguler, Tambora Bisnis, Tambora Prestise and Tambora Rencana. 5. Boosting financing through the 2020 Bank NTB Syariah Hijrah Fest program for consumptive financing. 6. Tiering Limit Scoring Counterpart Bank financial ratios to optimize the placement of funds in the Islamic money market. Pejanggik BO, PresDir, Dir. of Fund&Service, Dir. of Fin. & Opr, REN, RBN, DNR, SPI, JRL, KEP, MJR, APK, PBY, TSI, TRS. Spirit of Amanah, Optimistic and Growth in Sustainable Business Participant PT Bank NTB Syariah. 2020 Annual Report 338
  340. Good Corporate G ove r n a n c e No 3 . Date Agenda 15 October 2020 Participant 1. Financial Performance of Bank NTB Syariah per September 2020. 2. Review Bank NTB Syariah's Gelegar Hijrah program and expand the program participants for Annuity financing accounts. 3. Provisions for calculating the Debt Service Ratio of financing for Sejahtera iB Amanah Consumers and for the bank’s pre-retirees and retirees. 4. Accelerated repayment provisions for pre-retirees and retirees. 5. Determination of the Fee Based Income Tariff for Certificate of Active Account 4. 17 November 2020 1. Financial Performance of Bank NTB Syariah per October 2020. 2. Reviewing provisions for the calculation of the Third Party Fund profit sharing. 3. Reviewing the Management of Corporate Deposits. 4. The application of 360-day-a-year in calculating the profit sharing of deposits. 5. Financing of Bale iB Amanah "Angsuran Berkah Amanah” 6. Administrative costs for pre-retirees and retirees financing. 7. Review the Provisions of Conditions for Replacement of Lost/Damaged ATM Cards and Savings Book. 5. 21 December 2020 Review the provisions of the Sharia Money Market Counterparty Limit. Pejanggik BO, PresDir, Dir. of Fund&Service, Dir. of Fin. & Opr, REN, RBN, DNR, SPI, JRL, KEP, MJR, APK, PBY, TSI, TRS. Pejanggik BO, PresDir, Dir. of Fund&Service, Dir. of Fin. & Opr, REN, RBN, DNR, SPI, JRL, KEP, MJR, APK, PBY, TSI, TRS. Pejanggik BO, PresDir, Dir. of Fund&Service, Dir. of Fin. & Opr, REN, RBN, DNR, SPI, JRL, KEP, MJR, APK, PBY, TSI, TRS. Pejanggik BO, PresDir, Dir. of Fund&Service, Dir. of Fin. & Opr, REN, RBN, DNR, SPI, JRL, KEP, MJR, APK, PBY, TSI, TRS. 4. INFORMATION TECHNOLOGY STEERING COMMITTEE a. Organizational Structures and Memberships of the Committee CHAIRMAN PRESIDENT DIRECTOR SUBSTITUTE CHAIRMAN SECRETARY I DIRECTOR OF FINANCE AND OPERATIONS GENERAL MANAGER TSI SECRETARY II GENERAL MANAGER UMM ANGGOTA DIRECTOR OF FUNDS AND SERVICES DIRECTOR OF COMPLIANCE & RISK MANAGEMENT GENERAL MANAGER DNR GENERAL MANAGER JKE GENERAL MANAGER PBY GENERAL MANAGER APK GENERAL MANAGER SDI GENERAL MANAGER KEP GENERAL MANAGER REN 339 PT Bank NTB Syariah. 2020 Annual Report GENERAL MANAGER SPI DESK HEAD MJR Spirit of Amanah, Optimistic and Growth in Sustainable Business
  341. b . Duties and Responsibilities of the Information Technology Steering Committee : 1) Providing direction on the IT (Information Technology) strategic plan to fit the strategic plan of the Bank's business activities by taking into account efficiency and effectiveness factors. 2) Making a rood map to achieve IT needs that support the Bank's business strategy. Road map consists of current conditions (current state), conditions to be achieved (future state) and steps that will be taken to reach a future state. 3) Providing direction on the formulation of key IT policies and procedures such as IT security policies and risk management related to the use of Tl at the Bank. 4) Providing direction for approved IT projects following the Plan. 5) Determining the priority status of critical IT projects (having a significant impact on operational activities at the Bank), for example, the replacement of the Core Banking Application server production and network topology 6) Providing direction for the implementation of IT projects by the project plan (project charter) agreed in the service level agreement and provide recommendations on the results of an analysis of key IT projects to enable the Directors to make decisions efficiently. 7) Providing direction so that the need for a Management Information System (SIM) can support and be in line with the management of the Bank's business activities. 8) Providing direction so that steps to minimize risk on Bank investment in the IT sector are efficient and that these investments contribute to the achievement of the Bank's business objectives. 9) Monitoring the performance of IT, and improve efforts for example by detecting finance of IT and measuring the effectiveness and efficiency of implementing IT security policies. 10) Facilitating the relationship between the user work unit and the organizer work unit to solve various problems. 11) Analyzing the HR needs of the Bank owned by the Bank, to provide direction whether the Bank needs to use the services of other parties in the implementation of IT following related policies and procedures. c. Organizational Structures and Memberships of the Staff Supporting Group IT (SSG-TI) Committee. The Staff Supporting Group (SSG-IT) organization is a vehicle to assist in analyzing the information technology policy, standard, planning, development and procedure processes that are in line with the strategic plan of the Bank's business activities to optimize the role and function of the Information Technology Steering Committee. The organizational structure is as follows: CHAIRMAN DEPUTY GENERAL MANAGER OF IT & NETWORK PLANNING & DEVELOPMENT MEMBER DEPUTY GENERAL MANAGER OF RETAIL FUNDS PRODUCT & SERVICE DEVELOPMENT DEPUTY GENERAL MANAGER OF RETAIL & CONSUMER DEPUTY GENERAL MANAGER OF NETWORK & BRANCH DEVELOPMENT DEPUTY GENERAL MANAGER OF REPORTS & TAXATION Spirit of Amanah, Optimistic and Growth in Sustainable Business DEPUTY GENERAL MANAGER OF BUSINESS DEVELOPMENT & RETAIL FUND MARKETING DEPUTY GENERAL MANAGER FOR SERVICE DEVELOPMENT DEPUTY GENERAL MANAGER OF ACCOUNTING MANAGEMENT & FINANCIAL CONTROL DEPUTY GENERAL MANAGER OF COMMERCIAL FINANCING TSI ANALYST PT Bank NTB Syariah. 2020 Annual Report 340
  342. Good Corporate G ove r n a n c e d . Duties and responsibilities of Staff Supporting Group IT Committee (SSG-TI) 1) Assist in analyzing the process of formulating policies and standards for the use of Bank information technology to minimize risks to the Bank's investment in the use of Information Technology. 2) Help arrange the planning and development of the Bank's Information Technology regarding the formulation of Information Technology policies and procedures. 3) Assist in resolving various problems related to Information Technology that cannot be solved by the user work unit and Information Technology provider in an effective, efficient, and timely manner by considering the allocation of resources owned by the Bank. e. Committee Works Report During 2020, the Information Technology Steering Committee held discussions and submitted suggestions covering several important activities carried out by the Bank in 3 meetings with the following meeting details: No Date Agenda Participant 1. 14 July 2020 1. IT Development Strategy. 2. IT Division’s Bank Business Plan for 2020. 3. Progress of IT Development for Bank NTB Syariah. Presdir, Dir. Fin, Dir. KOP, TSI, RBN, SPI, DNR, JKE, PBY, REN, MJR, KEP, APK, KC. Pejanggik. 2. 23 September 2020 1. Development of Core Banking 2. Digitalization of Bank NTB syariah Services. Presdir, Dir. Fin,Dir. KOP, TSI, RBN, SPI, DNR, JKE, PBY, REN, MJR, KEP, APK, KC. Pejanggik. 3. 17 November 2020 1. IT Operational Evaluation. 2. IT Development Progress. 3. Bank NTB Syariah IT Development Plan for 2021 Presdir, Dir. Fin, Dir. KOP, TSI, RBN, SPI, DNR, JKE, PBY, REN, MJR, KEP, APK, KC. Pejanggik. 5. FINANCING COMMITTEE AND FINANCING PROCESS PROPOSED LIMITS FOR HEAD OFFICE, BRANCH OFFICES AND SUPPORTING BRANCH OFFICES The Financing Committee is stipulated in the Decree of the Board of Directors Number: SK/01.17 /64.27/032A/2020 dated April 24, 2020 concerning the Committee and Limit for the Proposed Financing Process of PT Bank NTB Syariah with the following details: a. Ilustrasi Flow Usulan Pembiayaan Unit Limit Sub-branch 150 Million Sub-branch 750 Million SBM Sub-branch Sub-branch Sub-branch Sub-branch 500 Million Sub-branch 750 Million BM Branch Sub-branch BO & SBO Sharing Sub-branch 1 Billion Branch 2.5 Billion BM/GM BO/HO Sub-branch BO & SBO Sharing Sub-branch 2.5 Billion Head Office 2.5 Billion GM Head Office Sub-branch BO & SBO Sharing Sub-branch >2,5 Billion Head Office >2,5 Billion GM/Commitee Head Office Sub-branch BO & SBO Sharing Branch 500 Million Branch 2,5 Billion BM Branch Branch Branch Branch 2 Billion Branch 2,5 Billion GM Head Office Branch Branch Branch > 2,5 Billion Head Office >2,5 Billion Committee Head Office Branch BO/HO Head Office >2,5 Billion Head Office >2,5 Billion Committee Head Office Pejanggik BO Head Office PT Bank NTB Syariah. 2020 Annual Report Unit Costumer Maintenance Request 341 Officials Booking Office Proposer Target Sharing Spirit of Amanah, Optimistic and Growth in Sustainable Business
  343. Explanation of the Illustration Table of Proposed Financing Flow : 1. The authority of the Financing Deciding Unit and the Process Units shall refer to the Decree of the Board of Directors. 2. Process Unit is a unit that proposes financing. 3. Process Limit is the maximum limit that can be processed by a work unit. 4. Deciding Officer is an official who has the authority to decide on financing. 5. Deciding Unit is a work unit that has the authority to decide on financing. 6. Booking office is a work unit that carries out the process of disbursement of financing and a place for financing portfolios. 7. Customer Maintenance is a work unit that monitors the customer. 8. Target Sharing is a common target that is owned by a work unit in order to fulfill the KPI of each work unit with a proportion of 50%: 50% of the Portfolio or a maximum of the limit of the process owned by the work unit. b. Mechanisms and Procedures for Carrying Out Duties of the Financing Committee 1. Sub-Branch Authority a) A financing application is submitted through a Sub-Branch and is registered by the Sub-Branch. b) The Sub-Branch proposes the financing according to the process limit. If the process limit is exceeded, the Sub-Branch is tasked with collecting Customer's data and documents and conducting SLIK test on the application. Then, the Sub-Branch will write to its Main Branch to continue the financing analysis process (sample letter to main branch can be found in attachment 4). If, based on the sub-branch assessment, the financing proposal is not feasible, the sub-branch does not need to forward it to the branch. c) If the sub-branch Applications Exceed the Process Limit of its Main Branch (maximum of IDR2.5 Billion), the Main Branch will forward it to the Head Office to continue the financing process. d) Before a decision on Financing is made by the Sub Branch Manager, the Deputy Sub Branch Manager and/or Operational Supervisor will carry out a four eyes principal/Risk taking unit, which means that DSBM together with the Operational Supervisor gives/signs the Four Eyes Opinion. If one of them is unable to attend due to a leave/sickness/official duty, at least one of these officials should perform Four Eyes. The regulations for deploying Four Eyes are as follows: 1) For proposed financing ≤ Rp. 200,000,000, - (less or is equal to Two Hundred Million Rupiahs), t 2) For proposed financing > Rp. 200,000,000, (greater than Two Hundred Million Rupiahs), Spirit of Amanah, Optimistic and Growth in Sustainable Business d) The process of giving decision is in accordance with Branch Manager’s limit of authority to decide: 1) If the limit of authority to decide on financing is in accordance with the authority of the SBM, then the Approval Sheet Model 2) If the application for financing exceeds the SBM’s Limit of Authority to decide, the financing decision process will be forwarded to the Main Branch using the approval sheet f) The process of disbursement of financing is carried out by the Financing Administration, Rescue and Reporting section. 2. Branch Limit of Authority a) The application of financing is submitted through and is registered by the branch. The branch then proposes/creates NAP with a maximum limit of IDR 2.5 billion. b) If the financing proposal exceeds the limit that the branch may process, the branch is then tasked with collecting data and carrying out a SLIK test on the application and forwarding it to the Head Office by mail to be analyzed. c) Before the Branch Manager made the decicion on the financing, the Deputy Branch Manager of Operations/Deputy Branch Manager/Supervisor of APP as the four eyes principal/Risk taking unit which were referred to as the DBM/DBM BO, together with the Operational Supervisor, gives/signs the Four Eyes Opinion. If one of them is unable to attend it due to a leave/illness/official duty, at least the Four Eyes principle is carried out by one of the officials. The regulations for deploying the Four Eyes are as follows: 1) For proposed financing ≤ Rp. 200,000,000, - (less or is equal to Two Hundred Million Rupiah) 2) For proposed financing > Rp. 200,000,000, (greater than Two Hundred Million Rupiahs) d) The process of giving decisions is in accordance with the Branch Manager limit of authority to decide: 1) If the limit of authority to decide on financing is in accordance with the authority of BM. 2) If the application for financing exceeds the BM’s Limit of Authority to decide, then the financing decision process is forwarded to the Head Office. e) The financing disbursement process is carried out by the Financing Administration, Securing and Reporting division, and if the Customer is proposed by the sub-branch office, the booking/disbursement process will be carried out at the Proposing sub-branch office. PT Bank NTB Syariah. 2020 Annual Report 342
  344. Good Corporate G ove r n a n c e 3 . Head Office Limit of Authority a) Applications of financing that exceed the Limit that the Branch may process are forwarded to the Head Office together with letters and documents as well as the results of the Customer's SLIK test to be further processed by the Head Office Proposing Team. b) The Head Office processes financing proposal using an example of approval sheet shown in attachment 12. c) Financing proposal is submitted to the Unit in charge of Compliance and Risk Management latest by 1 (one) working day to be reviewed. Then, the unit will issue the Opinion on Risk and Compliance before the proposal is processed by the Committee. The example of opinion on Risk and complience is shown in attachment 13. d) Head Office business unit follows up on the risk opinion of the Risk Management Unit e) Financing proposal, risk opinions and follow-up on risk opinion become materials for Committee meetings f) Implementation of the Committee by the financing Committee at the Head Office g) Financing Decree (SKP) is signed by the officials according to their authority. h) The process of disbursement of the Head Office is carried out by the Administration Desk, Supervision and Rescue Financing through Pejanggik branch. If the Financing Proposal is submitted through a Branch, the booking process is carried out at the branch proposing the customer. c. Table of the Financing Committee, Deciding Limits and Proposal Limits for the Productive Financing Process Committee Member Proposer Four Eyes Signatory Deciding Limit Limit Proses No Work Unit 1. Class 2 Sub-branch Business Supervisor and / or Financing Analyst SBM Supervisor Ops SBM 2. Class 1 Sub-branch Business Supervisor and / or Financing Analyst SBM DSBM dan/atau Supervisor Ops SBM 3. Class 3 Branch Financing Supervisor and / or Financing Analyst BM DBM dan/atau Supervisor APP BM s.d Rp2,5 Miliar 4. Level 2 Branch Financing Supervisor and / or Financing Analyst BM DBM dan/atau Supervisor APP BM s.d Rp2,5 Miliar 5. Class 1 Branch Product Financing Supervisor and / or Product Financing Analyst BM DBM BO dan/atau Supervisor APP BM s.d Rp2,5 Miliar 6. Branch/Sub-branch Analyst, Supervisor and Branch Manager GM Financing Supervisor APP dan/atau DBM BM ≤ Rp. 2,5 Miliar 7. Division Risk Management and / or Commercial Financing Analyst, RBN Analyst and / or RBN Manager *) Div.Committee (GM PBY, DGM PBY Kom, DH RBN) GM Kep dan DH MJR GM Financing >2,5 Miliar s.d ≤ 5 Miliar 8. Level 1 Directors Commercial Fin. Analyst and/or Fin. Risk Management, RBN Analyst and/or RBN Mgr, DGM of Commercial Fin., GM of Fin. and RBN Desk Head Div.CommitteeBisnis (Dir Pby, Dir D&J, Dir Kop) Dir Kep & MJR, GM Kep dan DH MJR Director of Financing > Rp. 5 Miliar s.d ≤ Rp. 15 Miliar 9. Level 2 Directors Fin. analyst and/or Fin. Risk Management, RBN Analyst and/or RBN Manager, DGMof Commercial Financing, GM of Financing, RBN Desk Head Div.Committee (PresDir, Dir PBY, Dir D&J, Dir KOP) Dir Kep & MJR, GM Kep dan DH MJR President Director or Director of Financing > Rp. 15 Miliar s.d BMPP. Sesuai Surat Keputusan Direksi terhadap masing masing person. s.d Rp750 Juta s.d Rp750 Juta s.d Rp. 2,5 Miliar > Rp. 2,5 Miliar *) Collateral Appraisal, Risk Analysis and Risk Mitigation are made by Business Risk *) Financial Statement Analysis is prepared by the business unit Figure of Flow of Productive Financing Process Proposer 343 PT Bank NTB Syariah. 2020 Annual Report Four Eyes Decision Maker / Committee Members Agreement Spirit of Amanah, Optimistic and Growth in Sustainable Business
  345. d . Financing Committee Alternate Table No Work Unit 1. I II III IV GM of Financing GM JKE GM TRS GM DNR BM PJK DGM of Commercial Fin. DGM PBY Comm DGM JKC DGM DNR BM PJK/KRJ Desk Head of RBN GM JKE GM TRS GM DNR BM PJK Level 1 Board of Dir. of Financing Pres. Director - - - Directors Dir. of F&S Pres. Director - - - Dir. of Finance&Opr Pres. Director - - - Division 2. Alternate Decision Maker/ Committee Members 3. - Pres. Director Level 2 Board of Dir. of Financing Alternate order (at least 2 people) : Directors Dir. of F&S 1. GM JKE Dir. of Finance&Opr 2. GM TRS 3. GM DNR 4. BM PJK Note: 1. The Level 2 Board of Directors Committee must be attended by the President Director of PT. Bank NTB Syariah. 2. Committee members who were replaced due to official dutied outside Lombok Island, leave, sickness and permanent absence (End of Service Period/Resignation/Death) at the Divisional Committee, Directors Level 1 and 2, maximum only 1 Director/1 Committee Member. 3. The implementation of this Alternate must go through the sequence of phases that have been determined in accordance with the table above. Table Alternate Four Eyes Alternate No Work Unit Four Eyes I 1. III GM Kep DGM CMO DGM HKM DGM KPA DH MJR DGM CMO DGM HKM DGM KPA Level 1&2 Dir Kep & MJR DGM CMO DGM HKM DGM KPA Board of GM Kep DGM CMO DGM HKM DGM KPA Directors DH MJR DGM CMO DGM HKM DGM KPA Division 2. II Note: 1. Four eyes members are replaced due to their official duties outside Lombok island, leave, sickness and permanent absence (End of Service Period/Resignation/Death). The maximum is only 1 Four Eyes Member. 2. The implementation of this Alternate must go through the sequence of stages that have been determined in accordance with the table above e. Table of the Financing Committee and Limit of Proposal of the Consumers financing Process. 1. For the customers of Sejahtera iB Amanah Product and PPPP iB Amanah, Financing, the financing decision process is as follows: Proposer Decision Maker (BM/SBM/GM) Aggreement Description: a) The analyst proposes the financing. b) The supervisor supervises and cross-checks the analyst's proposal by showing his/her agreement to sign the NAP and the checklist of requirements c) The decision maker gives a decision according to his/her authority.. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 344
  346. Good Corporate G ove r n a n c e 2 . For the consumer of financing Product other than those mentioned in Point a, Attachment 2, the financing decision process shall follow the table in attachment 1 as the following: Proposer Four Eyes Decision Maker (BM/SBM) Aggreement Description: a) Analyst processes the financing proposal. b) The supervisor supervises and cross-checks the analyst's proposal by showing his/her agreement to sign the NAP and the checklist of requirements c) Four Eyes d) The decision maker gives a decision according to his/her authority. e) Financing agreement. Committee Work Report During 2020, the Financing Committee discussed and conveyed suggestions regarding various important activities carried out by the Bank in 14 meetings. The details of the meetings are as follows: f. Names of person/companies applying for financing Limit Proposed (Rp) Limit Approved by the Committee (Rp) No Financing Proposing Branch 1. KC Pejanggik PT. Maulana Raya Lombok 10 Billion 8,6 Billion 2. KC Gerung PT Meka Asia Properti 5 Billion 5 Billion 3. KC Pejanggik PT Varindo Lombok Inti 40 Billion 38 Billion 4. KC Pejanggik PT Hissto Perkasa Nusantara Jaya 4 Billion 3.5 Billion 5. KC Sriwijaya PT Gerbang NTB Emas 10.062 Billion 9.7 Billion 6. KC Sweta PT Gerbang NTB Emas 10.441 Billion 10.1 Billion 7. KC Pejanggik PT Fajar Abadi Putra 5 Billion 4 Billion 8. KC Gerung Kas Daerah Lombok Barat 115 Billion 115 Billion 9. KC Pejanggik PT Salva Inti Property 10 Billion 5 Billion 10. KC Pejanggik PT Kerinci Jaya Utama 3.5 Billion 3.5 Billion 11. KC Pejanggik PT Mitra Universal Group 4 Billion 4 Billion 12. KC Sriwijaya PT Maulana Raya Lombok 10 Billion 10 Billion 13. KC Taliwang PT Baiti Jannati Lombok 5 Billion 5 Billion 14. KC Sumbawa Sarifudin/Wincell 2 Billion 1.39 Billion 345 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  347. INTERNAL AUDIT UNIT The internal audit plays a role as the third line that provides assurance and independent consultation on governance , improvement of risk management processes, internal control, and governance through a systematic, orderly and comprehensive approach through audit activities regarding financial and operational aspects. The Internal Audit Unit (SPI) Division as the executor of the Bank's Internal Audit function is equipped with adequate Auditor personnels, Branch Internal Control (KIC) and Administrative Personnels both in terms of quantity and quality. The implementation of the duties of the SPI Division is based on the Financial Services Authority Regulation (POJK) Number: 1/POJK.03/2019 dated January 28, 2019 concerning the Implementation of the Internal Audit Function at Commercial Banks and the Internal Audit Charter in accordance with the Decree of the Board of Directors of PT Bank NTB Syariah Number: SK. 01/14/64/048/2019 dated April 11, 2019. ORGANIZATIONAL STRUCTURE AND POSITION OF INTERNAL AUDITS Based on the Decree of the Board of Directors of PT Bank NTB Syariah Number: SK.01/16/64/075/2020 dated December 1, 2020 concerning the Organizational Structure and Work Procedures of PT Bank NTB Syariah, the organizational structure of the Internal Audit Unit Division (SPI) is as follows: PRESIDENT DIRECTOR GENERAL MANAGER Internal Audit Unit DEPUTY GM Management of supervision and prevention of fraud Branch internal control Auditor Administrative assistant The internal audit function is carried out by the Internal Audit Unit Division (SPI) with the following positions: a. The SPI Division takes direct responsibility to the President Director and can communicate directly with the Board of Directors, the Board of Commissioners, the audit committee, and the Sharia Supervisory Board to inform various matters related to the implementation of the audit. b. The SPI Division is led by a General Manager who is appointed and dismissed by the President Director of Bank NTB Syariah after getting approval from the Board of Commissioners by considering the recommendations of the Audit Committee and reported to the Financial Services Authority (OJK). c. The main duties of the SPI Division include assisting the President Director and the Board of Commissioners in conducting supervision by describing the planning, implementation and monitoring of audit results in operational terms. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 346
  348. Good Corporate G ove r n a n c e PROFILE OF GENERAL MANAGER DIVISION OF INTERNAL SUPERVISION UNIT Hj . Andarini Indonesian citizen, born in Yogyakarta on 23 July 1965, 54 years old. She completed her undergraduate degree at the Faculty of Economics, Universitas Islam Indonesia Yogyakarta in 1988 and first joined BPD NTB in 1989 through a recruitment program. Several strategic positions have been entrusted to Hj. Andarini i.e. as the Head of the Credit Division, as General Manager of the Accounting and Financial Control Division, and most recently as the General Manager of the Internal Audit Unit Division. INTERNAL AUDIT CHARTER The SPI Division has an Internal Audit Charter (IAC) which was approved by the President Director after obtaining approval from the Board of Commissioners by considering the recommendations of the Audit Committee in accordance with the Decree of the Board of Directors of PT Bank NTB Syariah Number: Sk.01/14/64/048/2019 dated April 11, 2019 . The Internal Audit Charter is a work foundation for SPI division in performing its duties to provide assurance and consulting services that are objective in nature with the aim of increasing added value and improving Bank operations through a systematic approach by evaluating and increasing the effectiveness of risk management, control and good governance. The Internal Audit Charter is also a required unit that the bank must have in order to maintain the quality of internal audits and emphasize the professional quality of internal auditors. AUDITOR CODE OF CONDUCT In carrying out its duties, the SPI Division refer to the Code of Ethics of Bank NTB Syariah Internal Audit Unit as a standard and reference for auditors to act and think in carrying out their duties and functions which includes: 1. Independence Free from situations that could threaten the ability of the SPI Division's to carry out internal audit responsibilities impartially. 2. Integrity Carry out duties carefully, honestly, diligently, sincerely, responsibly and comply with applicable laws, regulations and professional standards. 3. Objektivity An impartial mental behavior that enables Internal Auditors to carry out their duties in such a way that their work results can be trusted and without compromise in terms of quality. 4. Confidentiality Be prudent and careful in using and maintaining the confidentiality of information obtained in carrying out audit duties. 5. Competence In expressing an opinion, an auditor must use all abilities to obtain adequate evidence and reveal material facts. 347 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  349. BANK INTERN AUDIT ACTIVITY PROCESS The process of internal audit activities can be described as follows : Organization and Managamenet Internal Audit Framework 1 Audit Planning 2 Audit Preparation Documentation & Administration 3 Audit Execution Psychology and Communication 4 Audit Report Code Ethic 5 6 Audit Result Monitoring Quality Control HR Development The process of internal audit activities includes: 1. Audit Planning This stage is carried out at the end of the previous year and is intended to determine the unit to be audited in the next period/year. The determination is made based on a macro risk assessment. This planning includes the object of the audit or auditee to be audited as well as the allocation of resources including the budget. 2. Preparation for the Audit The audit must be properly prepared so that the audit objectives can be achieved efficiently and effectively. Preparation for the audit includes the activities of risk assessment and preparation of an audit program. Steps that need to be considered during the audit preparation stage include assigning a task, audit notification and preliminary research. 3. Execution of the Audit The audit execution stages include collecting data, analyzing, interpreting and documenting audit evidences and other information required in accordance with the procedures outlined in the audit program to support the audit results. 4. Audit Reporting After completing the audit, the auditor team is obliged to present the results in a written report. The report must meet the reporting standards, contain complete materials, and is well arranged. 5. Monitoring of Audit Results The SPI Division must monitor, analyze and report the progress of the follow-up improvements that have been carried out by the Auditee including monitoring the implementation of follow-ups, analysing the adequacy of follow-ups, reporting the follow-ups and progress of the unit being audited. 6. Quality Assurance To maintain the quality of audit activities, the SPI Division has a mechanism to evaluate the audit activities carried out consisting of supervision, internal review, and external review. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 348
  350. Good Corporate G ove r n a n c e SPI DIVISION WORK PLANS IN 2020 In carrying out supervisory or controlling tasks , the Internal Audit Unit (SPI) Division refers to the Regulation of the Financial Services Authority of the Republic of Indonesia Number: 1/POJK.03/2019 dated January 28, 2019 concerning the Implementation of the Internal Audit Function in Commercial Banks, the Internal Audit Charter, Internal Audit Policies and Guidelines. The following is the Work Plan of the Internal Audit Unit (SPI) Division for 220 and its realization: No Activities Plan Realization 1. On Desk Audit Implemented throughout the year through analysis of the output reports of each work unit. Already carried out. 2. On Site Audit 3 audit objects with the following details 1. 12 Branch Office Work Units 2. 21 Sub-Branch Offices 3. 9 Head Office Units The audit has been carried out according to plan. 3. Compliance Audit 2 Audit objects with the following details: 1. Audit of the operational implementation of the BI RTGS and SKNBI. 2. Audit on the implementation of Information Technology Operations. The audit has been carried out according to plan. 4. Audit Investigation Incidental Implemented in 2 units. 5. Internalization of Anti-Fraud Strategy Performed on the entire unit. Has been implemented according to plan. 6. Other Activities 1. Review Guidelines. 2. Audit on the management of Bank Indonesia Cash Custodians. . 1. Review the guidelines for implementing the anti-fraud strategy. 2. Has been implemented according to plan. INTERNAL FRAUD REPORT To prevent and eradicate fraud, the Bank has implemented prevention, detection, investigation, reporting, sanctions, as well as monitoring, evaluation and follow-up. Education/internalization programs for all employees in accordance with the anti-fraud pillar is also carried out regularly. Throughout 2020, there were no internal fraud either by management or by employees. DEVELOPMENT PROGRAM FOR SDI COMPETENCIES IN SPI DIVISION SDI's competence is a competitive advantage of a company. In relation to that, the Internal Audit Unit Division, together with the Human Resources Division (SDI), compiled a roadmap for every employee in the SPI Division to participate in training and certification to meet the required competence. The division also optimized all the potentials of its personnels/SDI so that they can be more qualified and competent. Human resources in this Division is also equipped with information technology which is expected to be able to improve the quality of audit results so as to provide added value in helping management to achieve organizational objectives. 349 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  351. FOLLOW-UP MONITORING OF INTERNAL AND EXTERNAL AUDITS Monitoring the follow-up of audit results is a series of activities carried out systematically by the Internal Audit Unit (SPI) to ensure that the work unit (Auditee) has implemented the audit results recommendations (both internal and external) according to the time previously agreed onThe Internal Audit Unit (SPI) Division submits a progress report on audit findings on a quarterly basis to the President Director which is copied to the Board of Commissioners as a form of fulfilling its commitments. As per December 2020, the progress of the follow-up on the audit findings was 93.31% of the total findings which was 2,690 with the following details: Finding Type of Assessment No Total Completed Un-Completed % Completion 1. Internal Audit 1.139 992 147* 87,09% 2. External Audit 1.551 1.518 33 97,87% Total 2.690 2.510 180 93,31% Notes: The majority of unfinished findings are the results of the SM II / 2020 audit that are not yet due Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 350
  352. Good Corporate G ove r n a n c e PUBLIC ACCOUNTANT The function of independent supervision of the bank ’s financial is carried out by doing an External Audit conducted by a Public Accounting Firm (KAP). External Auditors who examine the financial statements of Bank NTB Syariah for the 2020 financial year were determined by the Annual GMS based on recommendations of the Board of Commissioners and the Audit Committee. The selection process is carried out in accordance with the applicable goods and services procurement mechanism. To ensure the independence and quality of the audit results, the appointed External Auditor may not have a conflict of interest with the Bank. Following up on the General Meeting of Shareholders (GMS) results of 2018 Financial Year dated May 22, 2020, the bank appointed BDO Tanubrata Sutanto Fahmi Bambang and his team as the external auditors to examine the Company's Financial Statements and Other Reports for the 2020 Financial Year. THE PROCESSES OF APPOINTING PUBLIC ACCOUNTANTS The Public Accounting Firm (KAP) appointed to audit the Financial Statements of Bank NTB Syariah for the 2020 Financial Year was BDO Tanubrata Sutanto Fahmi Bambang and his team after an approval of the General Meeting of Shareholders was obtained on May 22, 2020. The following is a list of Public Accounting Firms (KAP) that provided Audit services to Bank NTB Syariah from 2015 to 2020: No Names of a Public Accountant Fiscal Year Assessment Fee Audit 1. BDO Tanubrata Sutanto Fahmi Bambang and Partner 2020 Fair without Modification 352.000.000 2. BDO Tanubrata Sutanto Fahmi Bambang and Partner 2019 Fair without Modification 330.000.000 3. Dolli, Bambang Sulistyanto, Dadang & Ali (DBSD & A) 2018 Fair 532.000.000 4. Dolli, Bambang Sulistyanto, Dadang & Ali (DBSD & A) 2017 Fair 365.000.000 5. Aryanto, Amir Yusuf, Mawar & Saptoto 2016 Fair 275.000.000 COORDINATIONS OF EXTERNAL AUDITORS AND AUDIT COMMITTEES Regarding the implementation of the monitoring function of the audit results carried out by external auditors i.e. Bank Indonesia (BI)/the Financial Services Authority (OJK), the Supreme Audit Agency (BPK), the Financial Transaction Reports and Analysis Center (PPATK), and KAP, the Audit Committee evaluated the follow-up actions on the audit results by the external auditors. SUPERVISIONS OF EXTERNAL AUDITORS The Audit Committee supervises the audit process by the external auditor through a regular meetings with the Public Accounting Firm to discuss all findings and developments during the audits. The committee assists and ensures that there are no obstacles in the execution of the audit. Addittionally, it evaluates the quality of the audit process by ensuring that the audit execution is in accordance with the applicable regulations and standards. 351 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  353. RISK MANAGEMENT Bank NTB Syariah pays great attention to the e ffective and efficient implementation of risk management in daily operational activities. Bank NTB Syariah views the implementation of comprehensive risk management as an important aspect for the bank to managing various risks it faces. This implementation aims to protect the bank from losses that may arise as well as to maintain the level of risk to bring it in line with business strategies and growth. Therefore, the bank maintains a balance between risks and benefits in order to generate long-term sustainable value growth for shareholders. The bank continues to strive to carry out regular monitoring of the level of risk faced including the entire risk management process carried out based on the application of the principles of Good Corporate Governance. In managing the risks, a corporate governance structure that functions to improve the four eyes principle and transparency in the risk management process is needed. BASIC RISK MANAGEMENT IMPLEMENTATION The implementation of Bank NTB Syariah Risk Management is based on the national regulations including Financial Services Authority Regulations (POJK), Financial Services Authority Circular Letters (SEOJK), Bank Indonesia Regulations (PBI), Bank Indonesia Circular Letters (SEBI) and internal regulations, including: 1. OJK Regulation No. 65/POJK.03/2016 dated December 28, 2016 concerning the Implementation of Risk Management for Sharia Commercial Banks and Sharia Business Units. 2. Implementation of Integrated Risk Management for Financial Conglomeration: a. OJK Regulation No. 17/POJK.03/2014 dated November 19, 2014 concerning the Implementation of Integrated Risk Management for Financial Conglomeration; b. OJK Circular Letter No. 14/SEOJK.03/2015 dated May 25, 2015 concerning the Implementation of Integrated Risk Management for Financial Conglomeration. 3. Assessment of the Soundness of Sharia Commercial Banks and Sharia Business Units: a. OJK Regulation No. 8/POJK.03/2014 dated June 11, 2014 concerning Soundness evaluation of Sharia Commercial Banks and Sharia Business Units b. OJK Circular Letter No. 10/SEOJK.03/2014 dated June 11, 2014 concerning Soundness evaluation of Sharia Commercial Banks and Sharia Business Units. 4. Minimum Capital Requirement for Islamic Commercial Banks: a. OJK Regulation No. 21/POJK.03/2014 dated November 18, 2014 concerning the Minimum Capital Requirement for Sharia Commercial Banks; b. Financial Services Authority Circular Letter Number 12/SEOJK.03/2015 dated 27 April 2015 concerning Minimum Capital Requirement in Accordance with Risk Profiles for Sharia Commercial Banks; c. Financial Services Authority Circular Letter Number 13/SEOJK.03/2015 dated April 27, 2015 concerning Calculation of Risk Weighted Assets for Operational Risk Using the Basic Indicator Approach for Islamic Commercial Banks; d. Financial Services Authority Circular Letter Number 13/SEOJK.03/2018 dated 20 September 2018 concerning Amendments to Financial Services Authority Circular Letter Number 34/SEOJK.03/2015 concerning Calculation of Risk Weighted Assets for Credit Risk Using the Standard Approach for Islamic Commercial Banks ; e. Financial Services Authority Circular Letter Number 35/SEOJK.03/2015 dated December 21, 2015 concerning the Calculation of Risk-Weighted Assets for Market Risk Using the Standard Method for Islamic Commercial Banks. 5. Decree of the directors Number: SK/01/11/64/012E/2018 dated November 19, 2018 concerning Company Guidelines (BPP) for Risk Management. RISK MANAGEMENT IMPLEMENTATION PRINCIPLES 1. The Three-Lines Defense Approach Bank NTB Syariah applies a three-line defense approach in dealing with risk management in every activity. In general, the three-line defense approach used by the bank can be described as follows. First Line of Defense Second Line of Defense Third Line of Defense Business unit Operational Work Unit Risk Taker Risk Management Work Unit Compliance Work Unit Risk Control Internal Audit Work Unit Risk Monitoring Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 352
  354. Good Corporate G ove r n a n c e a . First Line of Defense Business and operational units as the units that take and deal directly with risk (risk taking unit) act as the first line of defense in risk management. Business unit has a role and responsibility to carry out every risk management process i.e. identification, measurement, monitoring and control. Additionally, the unit is fully responsible for any risks that arise from each activity carried out. Management and senior officers play an important role in ensuring that every risk taking unit has played their role as the first line of defense and has carried out the risk management process effectively and consistently. b. Second Line of Defense The Risk Management Unit and Compliance Unit play an important role as the second layer of defense in the risk management framework. These work units play a role in performing an independent risk monitoring functionThe Risk Management Unit is tasked with monitoring and reviewing the risk management process carried out by the operational work unit. This unit makes sure that the process complies with the applicable regulations, is in accordance with mutually agreed parameters, and is regularly reported to the parties concerned. The Compliance Work Unit has the main authority and responsibility in managing compliance risk. This is done by ensuring that all regulations from regulators such as Bank Indonesia (BI), the Financial Services Authority (OJK), and other regulatory authorities have been socialized and implemented at all levels of the relevant organizations within Bank NTB Syariah. c. Third Line of Defense The Internal Audit Unit plays a role as the third layer of defense in the risk management framework of Bank NTB Syariah. Internal Audit is responsible for controlling by testing the accuracy of risk management processes carried out by operational work units and support units and ensuring that these work units perform their functions and responsibilities coherently and consistently and comply with applicable risk management policies and procedures. 2. The Prudential Principles In carrying out every business activity and operation, Bank NTB Syariah always applies the prudential principles. By prioritizing the application of the principles, it is expected that the bank can maintain customer trust and strengthen the intermediation function of the bank. The prudential principles applied by the Bank include: a. Compliance with Regulations Bank NTB Syariah has formulated policies, guidelines, and procedures as directions and references for every officer and employee in carrying out business and operational activities. Each of these policies, guidelines and procedures is formulated with due observance and compliance with all applicable rules and regulations. All of these documents are constantly reviewed 353 PT Bank NTB Syariah. 2020 Annual Report and updated in order to keep abreast of developments in regulations and lawsAll officers and employees of the bank are required to carry out Islamic banking activities in accordance with the regulations set by the regulator. b. Adequacy of Capital Bank NTB Syariah always manages and ensures adequacy of capital that reflects the business activities it carries out and the inherent risks. The bank also defines each component of capital by taking into account the available capital to cover potential losses that may arise. c. Diversification and Risk Limits In order to create a balanced and sustainable business portfolio component, the bank implements diversification or distribution of risks to be taken and managed in order to prevent concentration of banking portfolios and dependence on certain types of risk. Diversification of this risk is implemented by setting a limit amount of tolerance for certain risks. d. Know Your Customer Principles (PMN) As one of the players in the industry that emphasizes the importance of relationships with customers, the bank consistently and continuously applies Know Your Customer Principles (PMN) in accordance with the rules determined by the applicable regulations. In doing every business activity related to customers and counterparties, the bank ensures the compliance with all requirements and guidelines regarding Know Your Customer Principles. e. Transfer of Risk As a step in mitigating risks difficult to measure, the bank applies risk transfers to other parties (third parties) through certain transactions or other risk transfer actions in accordance with the applicable policies and regulations. 3. Consolidation of Risk In realizing the implementation of risk management as a whole, the bank applies the principles of consolidated risk management for all risk exposures spread throughout the company such as in business, operational, support units, as well as at every level of the organization as a whole. 4. Risk Culture The establishment of a culture and awareness of risks at all organizational levels at Bank NTB Syariah is very much needed in order to create risk management that involves all officers and employees. The development of a work environment that upholds a culture of risk and awareness of risks will create a more effective and efficient risk management because it is supported by all employees of the bank Thus, the implementation of risk management at the bank becomes stronger and can increase the trust of stakeholders. the bank is committed to building a risk awareness culture, through the application of risk at every level of the organization by implementing risk management education, such as: Spirit of Amanah, Optimistic and Growth in Sustainable Business
  355. a . Risk Management Certification and Refreshment of Education of Risk Management Certification which is attended by the Board of Commissioners, Directors, and echelon 1, 2, and 3 officials. For those who have received Risk Management certification, Bank NTB Syariah will continue to carry out socialization with a refreshment program so that they are kept up to date on risk management. b. Routine socialization by the Director of Compliance and Risk Management and by the Risk Management Unit at least 1 (one) time a year to all branch offices and sub-branches. The socialization was mainly carried out regarding the risk management tools used in Bank NTB Syariah. c. Training for Bank NTB Syariah employees through seminars and training is held by external parties. The Board of Commissioners and Directors are authorized and responsible for directing and supervising the establishment of a risk culture and awareness at every level of the organization. All work unit leaders are required to understand the importance of implementing risk management at the bank and communicate it in a good way to the lower levels. All employees of the bank are required to comply with all rules and regulations that have been set by the company and the authorities 5. The Disclosure Prinsiple Bank NTB Syariah applies the disclosure Principle to relevant regulators such as Bank Indonesia, the Financial Services Authority (OJK), the government of West Nusa Tenggara Province, and the public. This is done to enable shareholders, and stakeholders, as well as market players to evaluate the approaches, principles, and implementation of risk management by the Bank in its activities. ORGANIZATIONAL STRUCTURE OF RISK MANAGEMENT DESK Bank NTB Syariah's risk management framework and governance consists of a Board of Commissioners who performs a risk oversight function through the Risk Monitoring Committee. In carrying out the risk policy function, the Board of Directors is assisted by committees under the Board of Directors, including the Risk Management Committee (KMR) and the Asset and Liabilities Management Committee (ALMA Committee). At the operational level, the Risk Management Desk, internal audit, and compliance work units perform the functions of identification, measurement, risk monitoring, and risk control. DIRECTOR OF COMPLIANCE AND RISK MANAGEMENT DESK HEAD Risk Management MANAGER Risk Management Supervisor Risk Management Analyst Sisdur Analyst Risk Management Analyst Conglomeration Risk Administrative assistant Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 354
  356. Good Corporate G ove r n a n c e PROFILE OF THE HEAD OF RISK MANAGEMENT DESK Fakhriati Mahruf Indonesian citizen , born in Praya on May 1, 1969, aged 51. She completed her undergraduate degree at the Faculty of Economics, University of Mataram and Postgraduate degree (S2) at Department of Marketing Management at Mataram University in 2012. She started her career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to her including as the Head of Sub-Planning Division, Head of Sub-Financing Division, Praya Branch Office Branch Manager (BM), and most recently as Head of Risk Management Desk of Head Office. RISK MANAGEMENT POLICY MANAGEMENT Policy Management of Risk Management at Bank NTB Syariah includes 1. Board of Commissioners The Board of Commissioners has the authority and responsibility for risk management, which at least includes: a. Approve Risk Management Policies including Risk Management strategies and frameworks that are determined according to the risk appetite and risk tolerance of Bank NTB Syariah; b. Evaluating Risk Management Policies and Risk Management Strategies at least once a year or more frequently in the event of significant changes in factors affecting the business activities of Bank NTB Syariah; c. Evaluate the accountability of the Board of Directors and provide direction for improvement on the implementation of Risk Management Policies on a regular basis. Evaluation is carried out in order to ensure that the Board of Directors manages the activities and risks of Bank NTB Syariah effectively and consistently. 2. Sharia Supervisory Board The Sharia Supervisory Board has the authority and responsibility for risk management, which at least includes: a. Approve Risk Management Policies related to compliance with Sharia Principles at PT Bank NTB Syariah; and Evaluate the accountability of the Board of Directors for b. the implementation of Risk Management policies related to compliance with Sharia Principles at PT. Bank NTB Syariah 3. Directors The Board of Directors has the authority and responsibility for risk management which at least includes: a. Formulating written and comprehensive policies, strategies and risk management frameworks including risk limits as a whole and by risk type, taking into account the level of risk to be taken and risk tolerance in accordance with the conditions of Bank NTB Syariah and taking into account the impact of risks on capital adequacy. After obtaining approval from the Board of 355 PT Bank NTB Syariah. 2020 Annual Report Commissioners, the Board of Directors determines the policy, strategy and risk management framework; b. Develop, establish and update procedures and tools to identify, measure, monitor and control risks; c. Formulate and stipulate a transaction approval mechanism, including those that exceed the limit and authority for each level of position at Bank NTB Syariah; d. Evaluate and/or update policies, strategies, and risk management framework at least once a year or more frequently in the event of changes in factors affecting the business activities of Bank NTB Syariah, risk exposure, and/or profile significantly; e. Establish an organizational structure including clear authorities and responsibilities at each level of position related to the implementation of risk management; f. Responsible for implementing policies, strategies and risk management frameworks approved by the Board of Commissioners and evaluating and providing direction based on reports submitted by the Risk Management Unit (SKMR) including reports on risk profiles; g. Ensure that all material risks and impacts arising from these risks have been followed up and submit accountability reports to the Board of Commissioners periodically. The report referred to contains a progress report and problems related to material Risks along with corrective measures that have been, are being, and will be carried out; h. Ensure the implementation of corrective measures for problems or frauds which were discovered by the Internal Audit Unit (SKAI) in the business activities of Bank NTB Syariah; i. Develop a risk management culture in Bank NTB Syariah including risk awareness at all levels of the organization, including adequate communication to all organizational levels of Bank NTB Syariah regarding the importance of effective internal control; j. Ensure the adequacy of financial support and infrastructure to manage and control risks; k. Ensure that the risk management function has been implemented independently, which is reflected in i.e the Spirit of Amanah, Optimistic and Growth in Sustainable Business
  357. separation of functions between the Risk Management Unit (SKMR) which identifies, measures, monitors and controls risk and the work unit that carries out and completes transactions. 4. Risk Oversight Committee The risk monitoring committee has the duty and responsibility of providing recommendations to the Board of Commissioners by evaluating general risk management policies, evaluating the suitability of risk management policy guidelines of Bank NTB Syariah and its implementation and monitoring and evaluating the implementation of Risk Management. Duties and Responsibilities of the Risk Oversight Committee are: a. Evaluate the suitability of the implementation of Risk Management Policies; b. Monitor and evaluate the implementation of duties of the Risk Management Committee and the Risk Management Work Unit to provide recommendations for the implementation of risk management to the Board of Commissioners; c. Provide reports to the Board of Commissioners on the implementation of risk management by the Board of Directors and evaluate the accountability of the Board of Directors for the implmentation of risk management on a regular basis; d. Evaluate the risk management policies of Bank NTB Syariah and their implementation. 5. Risk Management Committee (KMR) The Risk Policy Committee (KKR) is led by the Director of Compliance and Risk Management which consist of the President Director, the Director of Funds and Services, and executive officers of related units. Duties and Responsibilities of the Risk Management Committee (KMR) are: a. Preparing Risk Management Policies and their amendments including risk management strategies, level of risk taken and risk tolerance, risk management framework, and contingency plans to anticipate abnormal conditions. b. Improve risk management processes on a regular basis or incidentally as a result of changes in the external and internal conditions of Bank NTB Syariah which affect capital adequacy, the risk profile, and the ineffective implementation of risk management based on evaluation results. c. Determination of policies and/or business decisions that deviate from normal procedures, such as significant exceeding business expansion compared to the previously established business plan or taking positions/risk exposures that exceed the predetermined limits. 6. Risk Management Work Unit The organizational structure of the Risk Management Work Unit (SKMR) was established according to the size and complexity of Bank NTB Syariah business. Bank NTB Syariah can determine the organizational structure according to the conditions including financial capabilities Spirit of Amanah, Optimistic and Growth in Sustainable Business and human resources. The Risk Management Work Unit (SKMR) works independently on the operational work unit (risk-taking unit), the support unit (STU), and the Internal Audit Unit (SKAI). Therefore, the operational work unit (risk-taking unit) is required to submit reports or information regarding risk exposures managed by the work unit concerned with the Risk Management Unit (SKMR) on a regular basis. The authorities and responsibilities of the Risk Management Work Unit (SKMR) include: a. Provide input to the Board of Directors in formulating policies, strategies and risk management frameworks; b. Develop procedures and tools for the identification, measurement, monitoring and control of risks; c. Design and implement the tools needed in the application of risk management; d. Monitor the implementation of policies, strategies and risk management frameworks recommended by the Risk Management Committee (KMR) and those approved by the Board of Directors; e. Monitor risk positions/exposures as a whole as well as per risk including monitor compliance with risk tolerance and established limits; f. Perform stress testing to determine the impact of the implementation of risk management policies and strategies on the overall portfolio or performance of Bank NTB Syariah; g. Assessing the proposed new activities and/or products being developed. The assessment focused primarily on aspects of the capability of Bank NTB Syariah to manage activities and/or new products including the completeness of the systems and procedures used and their impacts on the risk exposure of Bank NTB Syariah as a whole; h. Provide recommendations to business work units and/or to the Risk Management Committee (KMR) regarding the implementation of risk management, i.e. regarding the amount or maximum risk exposure that can be maintained by Bank NTB Syariah; i. Evaluate the accuracy and validity of data used by Bank NTB Syariah to measure risk using a model for internal purposes; j. Compile and submit risk profile report to the President Director, Director of Compliance and Risk Management, and the Risk Management Committee (KMR) on a regular basis or at least quarterly. The frequency of report submission should be increased if market conditions change rapidly; k. Carry out periodic reviews which frequency is adjusted to the needs of Bank NTB Syariah to ensure: 1) The adequacy of risk management framework; 2) The accuracy of the risk assessment methodology; and 3) The adequacy of risk management information system PT Bank NTB Syariah. 2020 Annual Report 356
  358. Good Corporate G ove r n a n c e 7 . Operational Work Unit The Operational Work Unit is a work unit that carries out the business and operational activities of Bank NTB Syariah outside the Risk Management Unit (SKMR), the Compliance Unit, and the Internal Audit Unit (SKAI). Business Units as Operational Work Units are responsible for managing risk as a whole within their units. is a deviation from the target to be achieved due to significant external and internal changes; i. The Bank has an adequate compliance work plan; j. In developing a reputation risk assessment system, the Bank ensures the compliance with internal policies and procedures in accordance with the applicable regulations. 8. Internal Audit Work Unit (SKAI) Internal Audit Work Unit (SKAI) is a work unit that carries out internal control function and ensures that Risk management has been implemented in accordance with existing rules and regulations. The Internal Audit Work Unit (SKAI) must be independent on/towards the Risk Management Work Unit (SKMR), and the Operational Work Unit at Bank NTB Syariah. 2. The adequacy of organizational instruments in supporting the effective implementation of Risk Management including clarity of authority and responsibility: a. Policies and Standard Operating Procedures in providing financing have been developed and implemented adequately to control financing risks, including: LLL provisions, policies for provision of funds for related parties, SOPs for credit risk and BPP for financing which are continuously reviewed; b. The Bank has established a special work unit to carry out the function of rescuing financing at the Head Office and at Branch Offices; c. The Bank has developed an organizational structure that ensures that the work units exposed to market risk are independent from the internal audit work unit. The Bank has also formed a Risk Management Committee and a Risk Management Work Unit to support the implementation of risk management related to market risk; d. The existing organizational instruments are supported by the delegation of authority which is controlled by granting limited and tiered powers to the operational unit, and is regularly monitored by the Internal Audit Unit; e. The Bank has set a strategy to increase TPF collection, especially retail funds; f. The operational work unit has informed the Risk Management Unit regarding the risk exposure inherent in its work unit through the Risk Control Group Report; g. The Bank has organizational instruments to support the implementation of legal risk management which is currently carried out by the Compliance Division in coordination with the Bank's lawyer; h. In terms of the adequacy of organizational instruments to support the implementation of risk management, the bank has policies and procedures to formulate and approve strategic plans as stipulated in the Decree of the Board of Directors No. SK.01.16/64/059/2018 dated July 2 2018 concerning BPP Strategic Planning for Bank NTB Syariah. The Bank also has a procedure to measure the progress achieved from the realization of the business plan and performance according to the set schedule; i. The Bank has a special work unit that carries out a compliance function that is independent from the operational work unit and has an adequate compliance work plan; j. The Bank has delegated authority by giving limited authority to units related to activities that have a reputation risk impact and have been monitored by the Internal Audit Unit; k. In developing a reputation risk assessment system, the Bank ensures the compliance with internal policies and procedures and in accordance with the applicable regulations. RISK EVALUATION PROCESS IN BANK NTB SYARIAH The Risk Evaluation Process is written in Bank NTB Syariah Risk Management Framework which includes: 1. Risk Management Strategy that is in line with the level of risk to be taken and risk tolerance: a. The Bank has established strategies to encourage the growth of productive financing in order to facilitate the real sector through program financing and non-program financing. The Bank also distributes financing to contractors to support Local Government projects; b. In developing a financing administration system, the Bank ensures the efficiency and effectiveness of financing administration operations including monitoring documentation, contract requirements, financing agreements (legal aspect) and collateral binding; c. Risk Management Strategy for market risk is prepared in line with the Bank's objectives and with a strategic scope for activities in order to maintain market quality, profit, and business growth; d. The Bank has established a strategy in raising third party funds and liquidity management which includes a funding strategy, management of intraday liquidity risk and position, as well as an emergency funding plan (CFP); e. The Operational Risk Management Strategy has been prepared by taking into account the Bank's ability to manage risks that arise as a result of changes in external and internal factors as well as diversification of the Bank's portfolio; f. Determine the Bank risk limits related to operational risk. It is improved continuously so that the coverage is more comprehensive; g. The Risk Management Strategy has been prepared by taking into account factors such as bank organization, the adequacy of human resources, bank capital and financial condition including the ability to generate profits and other supporting infrastructure; h. The Bank establishes a written strategic plan and business plan. The plan has been implemented, has been evaluated, and can be adjusted if there is a 357 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  359. 3 . Adequacy of policies, procedures and limit setting: a. The Bank has set a strategy to increase financing growth by setting a risk appetite for the deviation of financing realization against the target in the Bank's Business Plan; b. The Bank has policies and procedures as well as setting limits to manage risk of profit sharing, but it still needs to be improved; c. Liquidity risk management policies and procedures have been formulated in accordance with the mission, business strategy, capital adequacy, and human resource capacity; d. The Bank has policies and procedures for setting the limits related to liquidity risk; e. Risk Management Policies cover the vision, mission and strategic plans of the Bank and are relevant to the Bank's functional activities; f. The Bank has policies related to the determination of limits and determination of operational risk tolerance, which constitute limits on potential losses that can be absorbed by the Bank's capital capacity and a means of monitoring the development of the Bank's operational risk exposures; g. The Board of Directors has set authority limits in financial transactions for each Division, Main Branch, Branch and Sub-Branch; h. The Board of Directors has established operational risk management policies in implementing operational risk management that are in line with the vision, mission and strategic plans of the Bank and are more focused on operational risks relevant to the Bank's functional activities. Operational risks Policies/SOPs have been formulated, refined and socialized gradually. i. The Bank has written policies and procedures to control legal risk which are adjusted to the Bank's business strategy and to improve the compliance of all components in the organization with internal and external regulations; j. The Bank has a code of conduct that applies to all Managers and Employees; k. The preparation of the Bank's strategic plan has considered improving the organizational support capacity related to the availability of infrastructure including SDI and IT support. l. To ensure the compliance of the Management and all levels of the Bank with the prevailing laws and regulations as well as the Bank's values, the Board of Commissioners and the Board of Directors have established policies and procedures, including the Decree of the Board of Directors No: SK/01/11/64/012D/2018 dated November 19, 2018 concerning Bank NTB Syariah Company Manual Book (BPP), the compliance of bank NTB Syariah, and the Decree of the Board of Directors No. SK/01/11/64/012B/2018 dated November 19, 2018 concerning the Company Manual Book (BPP) for the Good Corporate Governance of Bank NTB Syariah; m. The Bank has written policies and procedures to meet the principles of transparency and improve the quality of customer service and other stakeholders in order to Spirit of Amanah, Optimistic and Growth in Sustainable Business control reputation risk which is regulated in the Decree of the Board of Directors No: SK.01/22/64/025a/2018 dated December 27, 2018 concerning Standard Operational Procedure for Settlement of the customers omplaint. RISK MANAGEMENT FOCUS IN 2020 During 2020, the development of risk management that the bank carried out includes: 1. Performing Risk Monitoring and Control Bank NTB Syariah conducted regular monitoring regarding risk limits as well as the achievement of risk appetite and risk tolerance for each risk. Meanwhile, in branch offices, the activities were done by reporting the Risk Control Group (GKR) regularly. 2. Financing Process Improvement Bank NTB Syariah is continuously improving the financing process through the development of the Financing Origination System (FOS) application in the third quarter of 2020 for the consumer in non-flagging prosperous financing. This has been implemented in branch offices gradually to realize effective and efficient financing activities while paying attention to the prudent aspects of the financing activities carried out. 3. Monitoring the Quality of Financing The process of monitoring financing through a process of reviewing the performance of financing for all segments includes conducting stress tests on the decline in financing quality in the second quarter of 2020 as a result of Covid-19 pandemic and efforts to anticipate the impact on Bank NTB Syariah. 4. Updating and Improving Financing Provisions Bank NTB Syariah has updated and improved the terms of financing which was part of the evaluation and review process carried out during 2020. 5. Monitoring of Liquidity and Market Risk Management Bank NTB Syariah regularly reviewed and monitored market and liquidity risk parameters with due observance of regulatory regulations as well as constantly performing liquidity stress tests to make sure that the Bank's liquidity is sufficient. 6. Preparing Risk Management Implementation Reports Bank NTB Syariah prepared reports on the implementation of risk management on a quarterly basis for risk profiles and semiannually for Bank Soundness Level reports. APPLICATION OF RISK MANAGEMENT IN GENERAL Bank NTB Syariah always emphasizes the application of prudent risk management. This is done through a process of identification, measurement, monitoring and risk control. Risk management is implemented through the following four pillars: PT Bank NTB Syariah. 2020 Annual Report 358
  360. Good Corporate G ove r n a n c e 1 . Active supervision by the Board of Commissioners, Directors and Sharia Supervisory Board (DPS) In supervising, the Board of Commissioners is assisted by several Committees including the Audit Committee, the Risk Monitoring Committee, and the Remuneration, and Nomination Committee. The Board of Commissioners supervises the implementation of the duties of the Board of Directors through a regular meeting of the Board of Commissioners and related committees. In addition to overseeing the performance of the Board of Directors, the Board of Commissioners and the committees under it provide direction and recommendations if necessary and its impelemtation is monitored. At the Board of Directors leve,l there are also several Committees that assist the operation of Bank NTB Syariah namely the Asset and Liability Management Committee (ALMA), the Risk Management Committee, the Technology and Information Steering Committee, the Human Resources Committee, and the Financing Committee. The course of business and activities of Bank NTB Syariah is carried out through meetings of the Board of Directors and meetings of the related committees which are held periodically. The follow-up of the directions and recommendations from these meetings is continuously monitored by the related committees and work unitsThe Sharia Supervisory Board, assisted by the Compliance Division, carries out related supervision on the implementation of sharia principles through meetings with related work units. The follow-up of the recommendations of the Board of Commissioners is always monitored by the Compliance Division. During 2020, meeting frequency was in accordance with the applicable regulations. The results of these meetings were documented. Follow-up of the meeting decisions was monitored. 2. Adequacy of risk management policies and procedures and determination of risk limits Bank NTB Syariah has a Risk Management Policy as the main guideline for the implementation of risk management which is the basis for business and operational policies and procedures. In risk management policies and procedures, limits are set for each activity, both at the portfolio and transactional levels. Bank NTB Syariah always evaluates the limit policy on the applied risk appetite and risk tolerance. The Evaluation is carried to adjust the acceptable risk profile and at the same time controls that can safeguard the Bank NTB Syariah from the potential for unwanted losses were established. To manage risk as a whole and to make sure that the risk management system is in line with the capital owned, Bank NTB Syariah establishes and always evaluates the imposed limits. The determined risk limits includes capital limits, rentability, limits per risk (credit risk, market risk, liquidity risk, and operational risk). The policies, procedures, and risk limits are periodically reviewed and approved by all levels of authority including the Board of Directors through committee meetings or through circulation to the Board of Directors according to the level of authority. 359 PT Bank NTB Syariah. 2020 Annual Report 3. Adequacy of the process of identification, measurement, monitoring, risk control, and information system risk management The risk management process is carried out by Bank NTB Syariah by identifying, measuring, monitoring and controlling 10 (ten) types of risk, namely: credit risk, market risk, liquidity risk, operational risk, strategic risk, reputation risk, legal risk, risk compliance, the risk of return, and investment risk. Identification: - New/ Existing Products - Activities - Inisiatives Measurement: - Methodology - Model approach, validation and techniques of Analysis Monitoring: - Risk exposure vs risk control; - MIS Control: - Control with qualitative and quantitative controls a. Risk identification is carried out by analyzing all risk sources that are at least carried out on the risks from the products and activities of Bank NTB Syariah and ensuring that the risks from new products and activities have gone through a proper Risk Management process before being brought about or implemented; b. Risk measurement is used to measure the risk exposure of Bank NTB Syariah as a reference for performing control. Risk measurement must be carried out regularly for products, portfolios, and business activities. Measurement approaches and methodologies can be quantitative, qualitative, or a combination of the two. Risk measurement is reflected in quarterly Risk Profile Report, stress testing analysis report, and other reports. c. Risk Monitoring of Bank NTB Syariah has monitoring systems and procedures which include monitoring of the amount of risk exposure, risk tolerance, compliance with internal limits, results of stress testing, and consistency of implementation with established policies, procedures, and limits. Risk monitoring activities are carried out by evaluating risk exposures contained in the business activities of Bank NTB Syariah. The information system available at least includes reports or information on the following: Spirit of Amanah, Optimistic and Growth in Sustainable Business
  361. 1 ) Overall risk exposure which includes any type of risk and activity; 2) Compliance with policies and procedures as well as the determination of limits that has been approved; 3) Realization of risk management implementation compared to the goals and targets set. 4. Comprehensive Internal Control System Bank NTB Syariah has implemented a comprehensive internal control system which includes: a. Conformity between the internal control system and the type and level of risk inherent in Bank NTB Syariah business activities; b. Establishment of authority and responsibility to monitor compliance with policies, procedures, and limits; c. Establishment of a clear reporting line and separation of functions from operational work units to work units that carry out control functions; d. An organizational structure that clearly describes the duties and responsibilities of each unit and individual; Accurate and timely financial report and operational e. activities. d. Risk control is adjusted to the risk exposure and the level of risk to be taken and in accordance with risk tolerance. The risk control process framework is based on an evaluation result of the risk exposure contained in Bank NTB Syariah business. One of the risk control or mitigation strategies implemented is to determine risk limits which is the main mechanism that the bank can use to control any risk-taking activity. This limit will be monitored regularly and adjusted to changes in business, economic conditions, and regulatory provisions. ASSESSMENT OF BANK NTB SYARIAH SOUNDNESS AND RISK PROFILE FOR THE 2020 ASSESSMENT OF BANK NTB SYARIAH SOUNDNESS (TKB) The assessment of the bank NTB Syariah Soundness Level in 2020 is as follows Rating Factor No Tahun 2020 Tahun 2019 1. Risk Profile 2 2 2. Good Corporate Governance 2 2 3. Rentability 2 2 4. Capital 2 2 Composite Value 2 2 The composite assessment reflects the condition of Bank NTB Syariah which is generally “healthy”. Thus, it is considered capable of facing significant negative effects from changes in business conditions and other external factors as reflected in the rating of assessment factors including: risk profile, implementation of GCG, rentability, and generally good capital. If there is a weakness, in general, it is less significant. The following is the explanation of the report. a. The Risk Profile contains an overview of the level of inherent risk in all activities of Bank NTB Syariah and the Quality of Risk Management Implementation (KPMR) with the assessment rating in Semester II-2020 is low to moderate. b. The assessment of Good Corporate Governance at level 2 reflects that the Management of Bank NTB Syariah has implemented Good Corporate Governance which is generally good. This is reflected in the adequate fulfillment of the principles of Good Corporate Governance. If there are weaknesses in the application of the principles of Good Corporate Governance, in general, these weaknesses are less significant and can be resolved with normal actions by the management of Bank NTB Syariah. c. The performance of Bank NTB Syariah in terms of profitability is adequate, the realization of profits has exceeded the target set. Bank NTB Syariah continues to strive to increase profitability by optimizing the management of productive assets and reducing operating costs. d. Bank NTB Syariah has adequate capital according to its risk profile which is followed by capital management in accordance with the characteristics, business scale and complexity of the Bank's business to support future business development and to cover the risk of losses that may arise in its operations. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 360
  362. Good Corporate G ove r n a n c e RISK PROFILE ASSESSMENT Risk Pro file Assessment aims to provide information to all stakeholders regarding the business risk conditions faced by Bank NTB Syariah. The risk profile includes an assessment of inherent risk and the comprehensive implementation of risk management by including the assessment of inherent risk and the assessment of the quality of risk management that reflects the risk control system. Bank NTB Syariah has conducted a risk profile assessment on a quarterly basis which is submitted to the Financial Services Authority (OJK). Based on the Financial Services Authority Regulation No: 8/POJK.03/2014 dated June 11, 2014 concerning the level of Soundness of Sharia Commercial Banks and Sharia Business Units, Bank NTB Syariah calculates and reports 10 (ten) types of risk, namely credit risk, market risk, liquidity risk, operational risk, legal risk, strategic risk, reputation risk, compliance risk, return risk, and investment risk. The results of Bank NTB Syariah Risk Assessment as of December 2020 are as follows: Risk Profile Rating of Inhern Risk KPMR Rating Risk Level Credit Risk Low to Moderate Fair Low to Moderate Market Risks Low to Moderate Satisfactory Low to Moderate Liquidity Risk Low to Moderate Fair Low to Moderate Operational Risk Low to Moderate Fair Low to Moderate Legal Risk Low to Moderate Satisfactory Low to Moderate Strategic Risk Low to Moderate Fair Low to Moderate Compliance Risk Moderate Fair Moderate Reputation Risk Low to Moderate Satisfactory Low to Moderate Revenue Risk Return Low to Moderate Satisfactory Low to Moderate Investment Risk Low to Moderate Fair Low to Moderate Composite Rating Low to Moderate Fair Low to Moderate RISK MANAGEMENT STRATEGY Bank NTB Syariah continues to strive to strengthen the implementation of risk management effectively in all work units and branch offices by implementing strategies including: 1. Cultivate risk management principles in all work units from lower level to management level; 2. Develop risk measurement methods and assessment parameters of risk exposures inherent in banking activities through risk control groups in all branches; 3. Organizational development and improvement of the quality of Human Resources (SDI) that can support the application of risk management principles in all banking activities; 4. Developing an integrated technology-based sharia risk management system; 5. Develop a reporting system at the Risk Management Desk that is informative and accountable that can quickly and precisely assist in the identification, measurement, monitoring, controlling and risk control processes; 6. Risk management procedures and determination of risk limits are carried out by taking into account risk appetite and risk tolerance based on experience in managing risks; 7. The management of risk related to emergencies and its handling is developed through a Business Continuity Management framework which includes the preparation of Business Continuity Plan (BCP) and Disaster Recovery Plan (DRP) provisions, BCP and DRP trials, as well as internal audits. 361 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  363. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 362
  364. Good Corporate G ove r n a n c e INTERNAL CONTROL SYSTEM COMPLIANCE FUNCTIONS The Internal Control System is a supervisory process of mechanism designed and stipulated by the management of the Bank and is applied on an ongoing basis with the application of the three lines model concept that involves all organizational lines and is supervised by the Board of Commissioners and Directors , to provide adequate assurance on: 1. Safeguarding and securing the assets of the Bank; 2. Ensuring the reliability of financial reports; 3. Increasing compliance with applicable regulations; 4. Reducing the financial or losses impact, irregularities including fraud and violations of prudential aspects; 5. Increase organizational effectiveness and increase cost efficiency. The increase on risk and complexity in the management of the Bank's business activities, in line with the developments in information technology, globalization and financial market integration have had a huge impact on the risk exposure faced by the Bank so that it is necessary to uphold the prudential principles and efforts to mitigate the risks of the Bank's business activities. both preventive (ex-ante) and remedial / curative (ex-post). Preventive measures can be taken by complying with various applicable banking principles to reduce or minimize risks to the Bank's business activities. Increasing the role and function of compliance as well as the compliance work unit is one of the important elements of the Bank's governance structure and compliance risk management framework so that potential risks in the Bank's business activities can be anticipated early in an effort to improve the Bank's optimal performance. The Bank implements an effective Internal Control System that is tailored to the objectives, business policies, size and complexity of business activities by referring to the requirements and procedures as stipulated in the regulator as well as by referring to best practices through the following actions: 1. There is a clear establishment of reporting lines and a separation of functions between operational work units and work units that carry out control functions. 2. The control function is carried out by the Risk Management Desk (MJR), the Compliance Division (KEP) and the Internal Audit Unit Division (SPI). 3. The SPI Division conducts reviews independently and objectively on procedures and operational activities on a regular basis. The results of the review are submitted in the form of audit reports and audit follow-up reports to the President Director with copies to the Commissioners, Audit Committee and Directors in charge of the compliance function. 4. The results of the review from the SPI Division and Branch Internal Control (KIC) are used as benchmarks for the level of compliance of the work unit with the established systems and procedures. The scope of internal control must cover all aspects and elements of the Bank's activities directly or indirectly, it is thought that it may influence the implementation level of proper operational activities to safeguard the interests of the Bank and the public. Apart from covering audits, assessing the adequacy and effectiveness of the internal control structure as well as the quality of its implementation, it also covers all aspects and elements of the Bank's organization, so that it could support optimal analysis in assisting the decision-making process by management. 363 PT Bank NTB Syariah. 2020 Annual Report The Bank always strives to implement a compliance culture and compliance awareness at all levels of the organization and business activities of the Bank, both in the form of advisory, monitoring of bank compliance with regulatory provisions as well as in the form of socialization and training to work units with based on the awareness that compliance is the responsibility of all organizational lines in the Bank and the awareness of individuals to comply with the regulations is always a priority. Every individual behavior is always based on core values and guided by the Bank's code of ethics. The Bank has appointed a Director in charge of the compliance function, with the duties and responsibilities of the Compliance Director including: 1. Formulate a strategy to encourage the creation of a Bank compliance culture; 2. Proposing compliance policies or compliance principles to be determined by the board of directors; 3. Establish compliance systems and procedures that will be used to formulate the Bank's internal provisions and guidelines; 4. Ensure that all policies, regulations, systems and procedures, as well as business activities carried out by the Bank, are in accordance with the provisions of the Financial Services Authority (OJK) and the prevailing laws and regulations; 5. Minimizing the Bank's compliance risk; 6. Take preventive measures so that the policies and / or decisions made by the Board of Directors of the Bank or the Head of the Bank Branch Office do not deviate from the provisions of the OJK and prevailing laws and regulations; 7. Perform other duties related to the compliance function. To assist the implementation of the duties of the Director in charge of the compliance function, a compliance division has been established. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  365. COMPLIANCE DIVISION The Compliance Division is an Independent Work Unit that reports directly to the Director of Compliance and Risk Management and assists the implementation of the duties of the Compliance and Risk Management Director in carrying out the compliance function at Bank NTB Syariah . STRUKTUR ORGANIZATIONAL STRUCTURES OF COMPLIANCE DIVISIONDIVISI K DIRECTOR OF COMPLIANCE AND RISK MANAGEMENT GENERAL MANAGER Compliance DEPUTY GM DEPUTY GM Compliance Manager & APU-PPT Law Manager Juris Administrative Assisstsnt Compliance Analyst KYC & APU-PPT Analyst Administrative Assisstsnt THE GENERAL MANAGER OF COMPLIANCE DIVISION PROFILE Lalu Audi Indonesian citizen, born in Tanjung Teros, East Lombok Regency on Tuesday, September 7, 1965, aged 55 years. Completed his undergraduate education at the Faculty of Law, University of Mataram in 1992. Started his career at BPD NTB in 1995 through a recruitment program. Several strategic positions have been entrusted to Lalu Audi including as Head of KCP Mataram Sweta, Deputy Head of KC Bima, Branch Manager of KC Bima, Pinsub Div of HR Training and Development, Deputy General Manager of HR Management and Services, Deputy General Manager of Compliance Management & APU-PPT, and finally as General Manager of the Compliance Division. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 364
  366. Good Corporate G ove r n a n c e INDEPENDENCIES OF COMPLIANCE The implementation of the Compliance Function refers to the Financial Services Authority (OJK) Regulation Number: 46 / POJK.03 / 2017 concerning on the Implementation of the Commercial Banks Compliance Function. The Director in charge of the compliance function and the Compliance Division conducted compliance function at Bank NTB Syariah. The Director in charge of the compliance function and the General Manager of the Compliance Division have met the independence requirements and criteria as stipulated by the prevailing laws and regulations. GUIDANCES OF COMPLIANCE In . carrying out the duties, the Compliance Division has been equipped with a work guideline in the form of a Compliance Letter of the Board of Directors Number: SK.01/11/64/12D/2018 concerning on BPP Compliance which approved by the Board of Directors on November 19, 2018 and has received approval from the Board of Commissioners. The Compliance BPP is the basis for the Compliance Division in carrying out the compliance function at Bank NTB Syariah. The purpose of creating a Compliance BPP is to comply with the code of ethics and professionalism in carrying out business activities and comply fully with the applicable Financial Services Authority Regulations and Laws and Regulations, including Sharia Principles, as well as ensuring the Bank's compliance with the commitments made by the Bank to the Financial Services Authority and/or other authorized supervisory authorities. BPP Compliance basic policies include: 1. Compliance Function. 2. The establishment of the Compliance Division. 3. Duties and responsibilities of the Board of Commissioners, Directors, Director in charge of compliance function, Compliance Division and Management and Employees of 4. Independence and Implementation of Compliance Division's Duties. 5. Relationship of the Compliance Division with related units and agencies. DUTIES AND RESPONSIBILITIES OF COMPLIANCE FUNCTIONS The Compliance Function is based on Financial Services Authority Regulation (OJK) No. 46 / POJK.03 / 2017 Regarding to the implementation of the Compliance Function of Commercial Banks, has the following duties and responsibilities: 1. Making steps to support the creation of a Compliance Culture in all Bank business activities at every level of the organization; 2. Identifying, measuring, monitoring, and controlling Compliance Risk by referring to the Financial Services Authority regulations (OJK) concerning on the Application of Risk Management for General Sharia Banks; 3. Assess and evaluate the effectiveness, adequacy and suitability of the Bank's policies, regulations, systems and procedures with the prevailing laws and regulations; 365 PT Bank NTB Syariah. 2020 Annual Report 4.. Review and / or recommend updating and refining policies, regulations, systems and procedures that are owned by the Bank in order to comply with the provisions of the regulator (Financial Services Authority/OJK) and the prevailing laws and regulations, including Sharia Principles; 5. Make efforts to ensure that the policies, regulations, systems and procedures, as well as the Bank's business activities are in accordance with the provisions of the regulator (Financial Services Authority/OJK) and the prevailing laws and regulations; 6. Take preventive measures so that policies and / or decisions taken by the Board Directors of the Bank do not deviate from the provisions of the regulator (Financial Services Authority/OJK) and the prevailing laws and regulations; 7. Perform compliance reporting duties to the President Director through the Director in charge of the compliance function with a copy to the Board of Commissioners; and 8. Perform other duties related to the Compliance Function. APPLICATIONS OF COMPLIANCE FUNCTIONS Based on POJK No. 46 / POJK.03 / 2017 Regarding to the Implementation of Compliance Functions of Commercial Banks, Compliance Functions of Banks including: 1. Realizing the implementation of a Compliance Culture at all organizational levels and Bank business activities; 2. Managing Compliance Risk faced by the Bank; 3. Ensure that the policies, regulations, systems, and procedures as well as business activities carried out by the Bank are in accordance with the provisions of the Financial Services Authority (OJK) and the provisions of laws and regulations, including the Sharia Principles for sharia commercial banks and sharia business units; and 4. Ensuring the Bank's compliance with the commitments made by the Bank to the Financial Services Authority and / or other competent supervisory authorities. In implementing the Compliance Function, the Compliance Division carries out a series of preventive (ex-ante) actions to ensure that policies, regulations, systems and procedures, as well as business activities carried out by the Bank are in accordance with the provisions of the Financial Services Authority(OJK) and regulatory provisions. laws and regulations, including Sharia Principles for sharia commercial banks and sharia business units, as well as ensuring the Bank's compliance with the commitments made by the Bank to the Financial Services Authority and / or other competent supervisory authorities. The activities carried out by the Compliance Division in order to implement the Bank's Compliance Function including: 1 Realizing the implementation of a Compliance Culture at all organizational levels and the Bank's business activities. All Bank NTB Syariah Employees are responsible for realizing the implementation of a Compliance Culture. In order to improve the Compliance Culture, in 2020 the Bank NTB Syariah Compliance Division has carried out several Spirit of Amanah, Optimistic and Growth in Sustainable Business
  367. several activities , including: a. Organize training on the implementation of the Compliance Function and the Compliance Culture Strengthening Program through the implementation of Compliance Awareness and Site Visits to Branch Offices, which aim to strengthen the Compliance Culture in Bank NTB Syariah. b. Held Socialization about the provisions of the Legislation related to the operational activities of Bank NTB Syariah directly or indirectly to all related divisions/units as well as to all Bank NTB Syariah Branch Offices. 2. 3. Managing the encounter of Compliance Risk Compliance risk arises when a bank does not comply with or does not implement Financial Services Authority regulations (OJK), as well as other applicable laws and regulations as well as sharia principles. To prevent such non-compliance, in 2020, the Bank NTB Syariah Compliance Division has carried out a series of mitigation programs / activities in the form of activities including: a. Monitor reporting obligations by maintaining the accuracy and timeliness of related reporting to the supervisory authority and other interested parties in accordance with applicable regulations. b. Review and analyze the process of providing financing that was decided by the Board of Directors committee, procurement of goods and services and placement of funds whose authority was terminated by the Board of Directors, opening office networks and product licensing. c. Disseminating new provisions to all divisions / units / units / branches of Bank NTB Syariah, both the provisions of the Financial Services Authority and the Legislation of other supervisory authorities with follow-ups in the form of updating related policies and procedures. d. Cooperate with the Bank's Policy Governance Unit to monitor and ensure the availability, adequacy and updating of internal regulations that become references in each organizational unit. e. Monitoring Compliance Risk through Risk Profile Reports that are submitted quarterly through the Risk Management Desk to be reported later to the relevant supervisory authority. Ensure that the policies, regulations, systems and procedures as well as business activities carried out by the Bank are in accordance with the provisions of the Financial Services Authority and laws and regulations, including Sharia Principles. Preventive measures taken by the Compliance Division in the context of implementing the Compliance Function including: a. Conducting Compliance Reviews on financing plans, procurement of goods and services, opening / moving office networks, placing funds (Financing Line), and licensing new products and / or activities; b. Provide opinion and validate the draft of the Bank NTB Syariah Internal Provisions; c. Conducting a Compliance Review. WORKING PROGRAMS OF COMPLIANCE DIVISION The Bank has made efforts to maintain compliance applicable with laws and regulations, other compliance standards that have been set internally, provisions regarding good corporate governance, and fulfillment of agreed commitments, both to internal and external parties, especially for each unit operational work. However, there are still things that need to be improved, regarding to the understanding and discipline of employees toward the Bank's internal rules and regulations as well as the control system over the implementation of the prevailing regulations, thus continuous improvement continues to be made so that the implementation of Good Corporate Governance principles and compliance practices inherent in daily work activities. The compliance division work program for 2020, such as: 1 Building a sharia-based Compliance Culture in all work units of the Bank; 2. Reviewing internal provisions and ensure that all policies and procedures are in accordance with applicable regulations; 3. Reviewing new OJK regulations before submitting them to the unit concerned; 4. Improving coordination with related units in order to follow up the Action Plan; 5. Formating the OJK POJK / SE review team; 6. Socializing to all employees regarding to applicable regulations and compliance culture (including Policies and Procedures, LTKT, LTKM, Data Updating); 7. Providing legal opinion/review and compliance to management and all work units of the Bank; 8. Implementing all conventional and sharia GCG components in accordance with POJK (socializing and implementing GCG practices and strengthening); 9. Improving corporate governance in aspects of the governance process. During 2020, the Compliance Division of Bank NTB Syariah took preventive steps in order to ensure that policies, regulations, systems, and procedures as well as business activities carried out by Bank NTB Syariah are in accordance with the provisions of the Financial Services Authority (OJK) and the provisions of laws and regulations, including the Sharia Principles. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 366
  368. Good Corporate G ove r n a n c e REALIZATIONS OF WORK PROGRAMS OF COMPLIANCE DIVISION 3 . Ensuring that policies, regulations, systems and procedures, as well as business activities, are in accordance with applicable regulatory regulations and sharia principles. The efforts made include: a. Prepare an executive summary of the new regulations issued by regulators (BI, OJK, other external regulations related to banking) that are submitted to the Board of Directors and Related Work Units. b. Submit a compliance review / opinion on every request for compliance opinion / advice related to the Bank's operational activities. c. Analyze and evaluate the effectiveness, adequacy and suitability of the Bank's internal policies, regulations, systems and procedures in accordance with the prevailing laws and regulations and provide input and responses to internal regulations. 4. Ensuring and escorting the implementation of sharia principles in the Bank's operational activities, through: a. Ensuring the availability of DPS Opinion at the request of the Work Unit. b. Ensure the compilation of reports on the results of supervision by DPS and submission to the OJK periodically (semesters). 5. Implementation of the Compliance Review on the Bank's strategic activities, including the following: a. Conducting a compliance review on the proposed plan for disbursement of financing at the level of the Board of Directors. b. Ensuring operational readiness for plans to open/ change addresses/change the status of the Bank's office network by fulfilling the list of requirements set out in the compliance check list set by the regulator. c. Review the procurement process for goods and services at the Board of Directors level committee to ensure that the procurement process for goods and services to be decided by the Board of Directors level committee has been carried out in an orderly, transparent, transparent manner and in accordance with the applicable GCG principles. During 2020, the Bank NTB Syariah Compliance Division has carried out activities / steps in order to ensure that the implementation of the Bank's compliance function is in accordance with the provisions of the Financial Services Authority (OJK) and the provisions of the Prevailing Laws, including the Sharia Principles. The activities / steps that have been taken by the Compliance Division are as follows: 1. Ensure that reports to related parties are fulfilled in a timely manner, including: a. Quarterly Compliance Director's Report to the President Director and a copy to the Board of Commissioners. b. Director of Compliance Semesterly to OJK Report. c. Self Assessment Report on GCG implementation every semester which is an integral part of the TKB report to OJK. d. The Annual Self Assessment Report on GCG Implementation which is an integral part of the Annual Report to the Stakeholders. e. Self Assessment Report on the implementation of Integrated Governance every semester to OJK. f. Annual Self Assessment Report on the implementation of Integrated Governance to OJK. 2. Ensuring the optimization of GCG implementation through: a. Socializing the implementation of GCG on an ongoing basis to the Bank's ranks, both actively (face to face) and passively (only delivering material related to GCG). b. Reviewing the implementation of the Annual GMS. c. Escorting the process of preparing the Annual Report. 367 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  369. APPLICATIONS OF ANTI MONEY LAUNDERING (APU) AND PREVENTION OF TERRORISM FUNDING (PPT) LEGAL BASIS 1. 2. 3. 4. 5. 6. 7. Law Number 21 of 2008 concerning Sharia Banking. Law Number 8 of 2010 concerning Prevention and Eradication of Money Laundering Crimes. Law Number 9 of 2013 concerning Prevention and Eradication of Criminal Acts on Terrorism Funding. PFSA Number: 12/POJK.01/2017 concerning the Implementation of the Anti-Money Laundering and Prevention of Terrorism Funding Program in the Financial Services Sector. SEFSA Number: 32/SEOJK.03/2017 concerning the Implementation of the Anti-Money Laundering and Prevention of Terrorism Funding Program in the Banking sector. SEFSA Number: 38/SEOJK.01/2017 concerning Guidelines for Blocking immediately on Customer Funds in the Financial Services sector whose identity is listed in the List of Suspected Terrorists and Terrorist Organizations. Guidelines for Anti-Money Laundering and Prevention of Terrorism Funding for Bank NTB Syariah in 2018. 8. 9. 10. 11. 12. 13. 14. 15. APU PPT MANAGEMENT The Bank has and is implementing APU PPT programs which are actively determined and supervised by the Board of Directors. The Bank's APU PPT is managed by the General Manager of the Compliance Division in the Compliance Unit as a Special APU-PPT Work Unit (UKK APU PPT). Duties and Responsibilities of APU-PPT Managers 1. To regularly analyze the risk assessment of the Crime of Money Laundering and/or the Crime of Funding Terrorism. 2. Compile, update and propose policies and procedures for implementing the APU and PPT programs 3. Ensure a system that can identify, analyze, monitor and provide reports effectively on the characteristics of transactions carried out by customers. 4 Ensure that the policies and procedures prepared are in accordance with changes and developments. 5 Monitor Customer's accounts and implementation of Customer transactions. Evaluate the results of monitoring and analysis of Customer transactions to ensure whether or not there are Suspicious Financial Transactions, Cash Financial Transactions and / or financial transactions of fund transfers to and from abroad. 6. Administering the results of monitoring and evaluation. 7. Ensure the updating of Customer data and profiles as well as Customer's transaction data and profiles. Spirit of Amanah, Optimistic and Growth in Sustainable Business Ensure that business activities with a high risk of Money Laundering and / or Terrorism Funding are identified effectively in accordance with the Bank's policies and procedures. Ensure that there is a good communication mechanism from related work units to Special Work Units or Officials who are responsible for implementing the APU and PPT programs by maintaining the confidentiality of information and paying attention to anti-tipping-off provisions. Supervise the implementation of the APU and PPT programs on related work units. Ensure the identification of high risk areas. Receive, conduct analysis, and prepare reports on Suspicious Financial Transactions and/or financial transactions made in cash. Prepare reports on Suspicious Financial Transactions, Cash Financial Transactions and/or financial transactions of fund transfers to and from abroad. Ensure that all activities in the implementation of the APU dan PPT programs are carried out properly Monitor, analyze, and recommend training needs on the implementation of APU and PPT programs for Bank Officials and/or employees. APU PPT SOCIALIZATION The APU-PPT socialization to Branch Offices is conducted at least 2 (two) times in 1 (one) year to all Branch Offices and Sub-Branch Offices of Bank NTB Syariah by coming directly (on the spot). Apart from coming directly to the socializatio, program was also carried out through the delivery of materials via e-mail or official letters. APU PPT 2020 IMPLEMENTATION 1. 2. 3. 4. 5. 6. Reporting on Cash Financial Transactions, Suspicious Financial Transactions, is done in a timely manner according to the reporting SLA. Analysis of suspicious and off-profile financial transactions has been carried out in coordination with the Branch Office as the document owner. Identifying high-risk customers of Bank NTB Syariah. Development of APU-PPT Supporting Applications. Implementation of Socialization and Evaluation 2 (two) times in Semester I and Semester II. Implementing the fulfillment of customer data requests to law enforcement agencies such as the Attorney General's Office and PPATK. PT Bank NTB Syariah. 2020 Annual Report 368
  370. Good Corporate G ove r n a n c e REALIZATIONS OF THE APPLICATIONS OF APU AND PPT PROGRAMS The Bank has made adjustments as well as re finements to policies and procedures for handling transactions related to Anti Money Laundering (APU) and Prevention of Terrorism Funding (PPT) in accordance with Financial Services Authority Regulation No: 12 / POJK.01 / 2017 dated 21 March 2017 as amended by Regulation The Financial Services Authority Number: 23 / POJK.01 / POJK / 2019 dated 30 September 20149 concerning Amendments to the Financial Services Authority Regulation Number: 12 / POJK.01 / 2017 concerning the Implementation of the Anti Money Laundering and Prevention of Terrorism Funding Program and the Regulation of the Head of the PPATK Number: PER-02 / 1.02 / PPATK / 02/2015 dated 3 February 2015. Implementation of KYC APU-PPT has been carried out but it is deemed that it still needs improvement for better implementation. Regarding the implementation of APU-PPT implemented during 2020, are as follows: Report Types OJK Realization of Data Updating PPATK Cash Financial Transaction Report (LTKT) Number of Reports 37.185 555 Suspicious Financial Transaction Reports (LTKM) 6 Integrated Service User Information System (SIPESAT) KPK Individual: 54.650 Corporation: 5.317 Request for Customer Information 1 Request for Customer Information - APPLICATION PLANS OF APU APT 2021 1. 2. 3. 4. 5. Improvement of APU PPT Application. Refreshment and Evaluation of APU-PPT implementation. Updating of Procedures/Directions for implementing APU PPT. Reporting APU-PPT to PPATK and or other regulators promptly. Submission of data/information to regulators such as OJK, DGT, Criminal Investigation, etc 369 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  371. TRANSPARENCY OF FINANCIAL AND NON-FINANCIAL CONDITIONS Transparency of financial and non-financial conditions of Bank NTB Syariah is presented clearly and transparently in several reports, including the following: 1. Annual Report The Annual Report referred to, includes: a. General information, which includes management, share ownership, business and business development, management strategies and policies as well as the Company's management report. b. The Annual Financial Report that has been audited by a Public Accountant and a Public Accountant Office that has been registered at Bank Indonesia and is made for 1 (one) financial year and presented with a comparison of 1 (one) previous financial year. c. Good Corporate Governance Report. 2. Quarterly Published Financial Reports Bank NTB Syariah also announces its quarterly Published Financial Reports under relevant provisions. The report was published in a newspaper, which has a wide circulation in NTB Province. 3. Monthly Published Financial Reports Bank NTB Syariah also prepares and submits Monthly Published Financial Reports in the format of Commercial Bank Monthly Reports (LBU) under Bank Indonesia regulations. Furthermore, the report is used as a basis by Bank Indonesia to publish monthly financial reports on the Bank Indonesia website. 4. Consolidated Financial Statements Bank NTB Syariah also prepares Consolidated Financial Statements based on applicable Financial Accounting Standards and submits reports as regulated in Bank Indonesia Regulations and public company regulations. 5. Non-Bank Financial Reports Bank NTB Syariah informs the Bank's products clearly, accurately and up to date. This information can be obtained easily by customers such as leaflets, brochures or other written forms at each branch office in locations that are easily accessed by customers and/or in the form of electronic information provided through the website. PROVISION OF FUNDS FOR SOCIAL AND/OR POLITICAL ACTIVITIES Bank NTB Syariah is a Regionally Owned Business Entity that operates and operates based on the company's principles by always referring to Law No. 40 of 2007 concerning Limited Liability Companies. Bank NTB Syariah in 2020 never aided or donations to political parties and was never involved in activities carried out by political parties. The assistance activities carried out by Bank NTB Syariah in the form of social assistance, sports, arts, and culture have been arranged by the Bank through Corporate Social Responsibility or (CSR) assistance which has so far been carried out by Bank NTB Syariah as a form of Bank NTB Syariah concern. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 370
  372. Good Corporate G ove r n a n c e LAW CASES Throughout 2020 , the number of civil and criminal legal matters that have been resolved (have permanent legal force) and are still in the process of being resolved can be presented in the table as follows: Total Legal Matter Criminal Case Settlement Status Non-Criminal Leverage on Bank Status The case of alleged Corruption in the Provision of Working Capital Credit from NTB Bank, Dompu Branch to Pesona Dompu Mandiri Inc. Rp6,8 B - still in the process of an appeal to the Supreme Court of the Republic of Indonesia which was submitted by the NTB High Prosecutor's Office The case of alleged Corruption in Providing Credit Without SOP Procedures at NTB Bank, Bima Branch in 2011 - - Decided by the Corruption Court at the Mataram District Court on January 3, 2020 Corruption Crime Case at the Mataram District Court Number: 3 / Pid.Sus.Tpk / 2017 / PN.MTR Rp1.5 B - still in the coordination stage with the Sumbawa District Prosecutor's Office and the Sumbawa BPN in the framework of the Execution Auction Evidence for recovering regional financial losses cq. Bank NTB Syariah Inc. NTB Bank Selong Branch in Police Report Number: TBL / 527.a / 2014 / NTB / Res.Lombok Timur dated 21 July 2014 Rp42 M - Still handled by the East Lombok Constabulary Still be the responsibility of the Bank Lawsuit Case for Unlawful Acts at the Rp1.099.011.923 Sumbawa Besar District Court with Number 39 / Pdt.G / 2017 / PN.SBW which was registered on October 27, 2017 - Has received a court decision and has carried out the execution of bail The result is in the form of disbursement of money from an individual's account which has subsequently been delegated to the Post of Virtue Fund at the Head Office and the remaining liabilities are still borne by the Bank. PT. Bank NTB Alas Sub-Branch, in Police Report Number: TBL / 549 / IX / 2012 / Res Sumbawa dated 7 September 2012 Rp1,742 M - Still handled by the Sumbawa Constabulary Still be the responsibility of the Bank Junaidi Rp1,5 B - Supreme Court Cassatio M Toha Rp625 M - PN 371 PT Bank NTB Syariah. 2020 Annual Report Pesona Dompu Mandiri Inc. has made repayments, so that it does not affect the performance of Bank NTB Syariah There is no bank loss Spirit of Amanah, Optimistic and Growth in Sustainable Business
  373. CASES ENCOUNTER BY MEMBERS OF THE BOARD OF COMMISSIONERS AND DIRECTORS During 2020 , there were no cases under the current members of the Board of Commissioners and Directors. INFLUENCE ON BANK CONDITIONS Of the important cases that have been encountered by the company during 2020, there are no cases that will have a negative impact on the financial condition and business continuity of the Company. ACCESS TO COMPANY DATA INFORMATION Bank NTB Syariah appoints the Corporate Secretary Desk Work Unit responsible for coordinating the management of communication media, both electronic and print media so that the integrity and credibility of Bank information to the public can be maintained. 3. The Bank guarantees the availability of access to Company information and data to the public through online and printed media such as: 1. Website Bank NTB Syariah website is an online media that can be accessed by the public and contains various information and data about Bank NTB Syariah, such as service products, news, press releases, and other important information aimed at all stakeholders. Aside from these information channels, Bank NTB Syariah also uses external media as an effort to provide information and data from the Bank to the public. Besides, Bank NTB Syariah has reported relevant information to the Shareholders and the Board of Commissioners by submitting Monthly, Quarterly and Annual Management Report to the Board of Commissioners before submitting it to the Shareholders. Also, the Company's website has published important information and governance policies for Bank NTB Syariah. Such information is related to the company's brief history, the Company's principles, the Company's business activities, the Annual Report and the Financial Statements. Furthermore, policies that have been published on the site include Corporate Ethics and Commitments, GCG Policies and the Company Code of Ethics. The Company's website can be accessed at the address www.bankntbsyariah.co.id 2. Annual Report The Annual Report is prepared annually which presents a summary of the Bank's financial and operational performance, Company Profile and Implementation of Corporate Governance including Corporate Social Responsibility Activities. This Annual Report will be submitted to shareholders, regulators, mass organizations, mass media, and the public. Spirit of Amanah, Optimistic and Growth in Sustainable Business Internal Communication Forum Means of communication for employees with management that are regularly conducted per each work unit, among others through family gatherings, monthly meetings, and morning briefings. DIRECT REQUEST CHANNEL INFORMATION During 2020 Bank NTB Syariah carried out publication activities in the media: Through brochures X-Banner Wall Sign Billboard Tool Gate Lombok International Airport Local Print Media in NTB Local TV in NTB National Magazines and Newspapers and Through Forums PT Bank NTB Syariah. 2020 Annual Report 372
  374. Good Corporate G ove r n a n c e CODE OF ETHICS Bank NTB Syariah always strives to run a business in accordance with the principles of GCG . To achieve this, Bank NTB Syariah already has a code of conduct, which is an ethical guideline that becomes the principle and basis which guides the relationship between Bank NTB Syariah Personnel and stakeholders in doing business. The code of conduct contains a value system, business ethics, work ethics, commitment, and enforcement of company regulations in conducting business and other activities, as well as interactions with stakeholders. The Bank's Code of Ethics applies to all Bank NTB Syariah personnel, starting from the Board of Commissioners, Directors, employees and other individuals related to the Bank's business. The content of the code of conduct includes: COMPLIANCE WITH BANK REGULATORS AND POLICIES All Bank Employees must comply with all of Bank’s Internal Regulations, Bank Indonesia/Financial Services Authority Regulations and other applicable laws and regulations: 1. All Bank employees are required to study, understand, and comply with any applicable provisions, policies and or Bank’s internal regulations consistently; 2. All employees are required to know, understand, and comply with the Bank Indonesia/Financial Services Authority Regulations and the prevailing laws and regulations; 3. All employees are individually responsible for complying with the Bank's Internal Regulations, Bank Indonesia/ Financial Services Authority Regulations and other applicable laws and regulations; 4. If an employee has committed an accidental violation of the Bank's Internal Regulations, Bank Indonesia/Financial Services Authority Regulations or other applicable laws and regulations, the employee must immediately stop the activity and report to the head of the respective work unit. 373 PT Bank NTB Syariah. 2020 Annual Report SOCIALIZATIONS OF CODE OF CONDUCT The code of conduct is communicated and disseminated to the Board of Commissioners and its supporting organs, the Board of Directors and all employees through the distribution of pocket books. In addition, socialization is also carried out in each work unit by the leadership. SANCTIONS FOR VIOLATING THE CODE OF CONDUCT 1. 2. 3. 4. 5. Every employee of Bank NTB Syariah who is proven to have violated the Company's Code of Ethics will be given sanctions in accordance with the prevailing rules and regulations; Sanctions for employees who commit violations are determined by the Board of Directors; The Board of Commissioners and/or the Board of Directors decide to provide guidance, disciplinary and/or other measures as well as preventive measures that must be implemented; Sanctions for the Board of Directors and Board of Commissioners for committing violations are decided by the Shareholders; If the violation is committed by an external party (suppliers, business partners or other stakeholders), it will be subject to the provisions contained in the relevant contracts and Company procedures. If there are indications of a criminal act, it can be forwarded to the authorities. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  375. GRATIFICATION POLICY In order to strengthen the implementation of good Bank governance , Bank NTB Syariah through the application of a code of conduct/ethics has reaffirmed the prohibition of acts of corruption and gratification for all levels of Bank NTB Syariah . This is related to joint commitment as stated in the code of conduct/ethics and corporate cultural values, which regulates conflict of interest, prohibitions on abuse of position and regulation of integrity. Bank employees are very aware of the need to maintain good cooperative relationships with customers, partners and all stakeholders by paying attention to ethics and avoiding things that lead to levels categorized as gratification and creating an anti-corruption culture. WHISTLE BLOWING SYSTEM Whistle blowing system (WBS) during 2020. Bank NTB Syariah is guided by the Decree of the Board of Directors regarding the Implementation of Anti-Fraud Strategies. Whistleblowing (complaint of violations) is a means of communication for internal and external parties of the Bank to report acts of fraud or violations committed by perpetrators within the Bank. Whistleblowing must be based on good faith and not constitute as a personal complaint or: 1. Build stakeholder awareness to report fraud or violations that occur within the Company without fear and worry because confidentiality is guaranteed. 2. So that fraud or violations can be detected and prevented as early as possible through disclosure from the whistleblower PROTECTION FOR WHISTLEBLOWER In implementing whistleblowing, Bank NTB Syariah will guarantee the confidentiality of the whistleblower's identity and the contents of the submitted report. To simplify and speed up the follow-up process, the following are the criteria that must be met by the whistleblower in submitting his / her report: 1. Provide information regarding the whistleblower 's identity, at least: a. Name of the whistleblower (anonymous is allowed). b. Contact phone number / email address. 2. Provide an initial indication that can be accounted for a reported fraud or violation (4W1H) accompanied by supporting data (if any), which includes: a. Reported actions (What). b. Parties involved (Who). c. Time of occurrence (When). d. Place / location of the incident (Where). e. How did it happen (How). Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 374
  376. Good Corporate G ove r n a n c e REPORTING SYSTEMS AND FOLLOW-UP MECHANISMS 1 . The means by which a whistleblower can submit his / her report can be accessed via email, that is through the address whistleblowing@Bankntbsyariah.co.id. The report submitted will be received directly by the whistleblowing manager. 2. Report Category 3. Fraud Deviations or deliberate omissions to deceive, defraud, or manipulate the Company, customers, or other parties, which occur within the Company and / or use Company facilities that caused the Company, customers, or other parties suffering losses and / or fraud perpetrators obtain financial gain either directly or indirectly. The types of actions that are classified as fraud are: 1. Cheating, 2. Fraud, 3. Embezzlement of assets, 4. Information leakage, 5. Banking crime (tipibank) Code of conduct violation Actions that are not in accordance with the corporate culture that has been formulated based on positive values that grow and develop within all Bank personnel, to achieve common goals and also as a reference for Bank personnel in making decisions and taking action. Conflict of interest violation Actions that cause a condition in which a person in carrying out his / her duties and obligations has an interest outside the office's interest, whether related to personal, family, or other party interests so that it is possible for the Company's Individuals to lose their objectivity in making decisions and policies in accordance with the authorities that have been given to him from the Bank. Law violation Actions that violate the laws force in Indonesia. Complaint Handling The following is the flow of complaint handling related to whistleblowing: Complaint GM SPI Directors/BoC Report Approval Not Fraud SDI Sanction Fraud Yes DGM PPPF Verification No Auditor Auditor Investigation Result Investigation a. DGM for Fraud Supervision and Prevention Management will first check the types of complaints submitted according to the types of violation criteria set by the Bank. b. DGM for Fraud Supervision and Prevention Management will verify the violation reports received, and report the results of the verification to the SPI GM at least include the following: 1) The date of the complaint, the identity of the whistleblower 2) The date of the violation 3) Type of offense and chronology 4) Alleged perpetrators and other parties suspected of being involved 5) The division or related unit being complained of 6) Estimated Bank loss (if the complaint is about fraud) 7) Initial evidence informed by the whistleblower (if any) 8) Follow up plan 9) If the verification results show that the complaint is inaccurate and there is no evidence, it will not be processed further. 375 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  377. c . DGM for Fraud Supervision and Prevention Management will produce a verification result report, and submit it to the President Director: 1) If the results of the verification indicate a violation is suspected of being committed by the Board of Directors, then GM SPI will report the results of the verification to the Board of Commissioners, to be followed up with an investigation process. 2) If the results of the verification indicate a violation is suspected to have been committed by an employee, then the SPI GM will report the results of the verification to the President Director, to be followed up with an investigation process. 3) If the verification results show an indication of a violation that is not a fraud category, the SDI Division must follow up the report on the verification result with the approval of the Board of Directors. d. In the event starting from the verification process to the approval of the President Director and / or the Board of Commissioners to proceed with the investigation process, the Bank shall stipulate that the decision is taken at the latest within 7 (seven) working days and can be extended again within 7 (seven) working days. DGM SPI will convey approval from the President e. Director and / or the Board of Commissioners to DGM Management of Fraud Supervision and Prevention for the implementation of investigations by internal auditors. f. The report on the results of the investigation is submitted to the President Director and or the Board of Commissioners for the imposition of sanctions in accordance with the applicable procedures and regulations. SURPRISE AUDIT The Surprise Audit mechanism is carried out primarily for business units that are at high risk, or are prone to fraud. The basic mechanism for implementing a Surprise Audit includes: 1. SPI Division as executor of the surprise audit. 2. The procedure for conducting a surprise audit is the same as for conducting a Regular Audit, however notification including the provision of required documents is only carried out a maximum of 1 (one) day in advance or without prior notification. 3. A Surprise Audit can be carried out specifically for one operation, or in one area or part or even on a transaction that is related to other transactions, depending on the plan for the surprise audit program. 4. The Bank will provide full access to conducting inspections, both technical checks on documents and examinations to the responsible individuals. Spirit of Amanah, Optimistic and Growth in Sustainable Business SUPERVISION SYSTEM The Supervisory System is an act of testing or examination that is carried out without being noticed or realized by the party being tested or examined in order to monitor and test the effectiveness of the anti-fraud policy. The Supervision System can be carried out by independent parties and / or internal parties of the Bank. 1 The objectives of the Supervision System are: a. Carry out comprehensive supervision of the implementation of the anti-fraud strategy determined by the Bank in accordance with its objectives. b. Identify, assess and analyze the established standard procedures that are carried out correctly and appropriately. c. Examining the bookkeeping process, including the authority to carry out transactions. d. Detection of weaknesses that are still found in the implementation of the Bank's anti-fraud strategy. 2. The Bank determines 5 (five) components in internal control, namely: a. Supervision by management and control culture (Management Oversight and Control Culture) b Identification and risk assessment (Risk Assessment) . It is a series of actions carried out by the Board of Directors in the framework of identifying, analyzing and assessing the risks faced by the Bank, considering that risks may arise or change in accordance with the conditions of the Bank. c. Control activities and segregation of functions. Control activities include policies, procedures and practices that provide assurance that the direction of the Board of Directors and the Board of Commissioners has been implemented effectively. Control activities are implemented at all functional levels in accordance with the Bank's organizational structure. Separation of functions is intended so that everyone in a position does not have the opportunity to commit deviations. Banks must comply with the principle of segregation of functions known as the four eyes principle. d. Accounting, information and communication systems. Adequate accounting, information and communication systems are intended to be able to identify problems that may arise and be used as a means of exchanging information in the context of carrying out their respective duties. e. Monitoring activities and deviation correction actions. Continuous monitoring of the effectiveness of the overall implementation of internal control. Weaknesses in internal control must be reported to and brought to the attention of the authorized official. PT Bank NTB Syariah. 2020 Annual Report 376
  378. Good Corporate G ove r n a n c e SOCIALIZATIONS OF WHISTLEBLOWING SYSTEM Bank NTB Syariah disseminates the Whistleblowing System (WBS) to all Bank Personnel to provide an understanding of the Whistleblowing Policy (WBS). Socialization is also carried out to other Stakeholders NUMBER OF COMPLAINTS ENROLLED AND PROCESSED IN 2020 In 2020, the WBS Management Team did not receive reports related to violations committed by Company Organs and Bank NTB Syariah Personnel so that the number of complaints that were submitted and processed in 2020 was not presented SANCTIONS / FOLLOW-UP COMPLAINTS THAT HAVE BEEN PROCESSED IN 2020 In 2020 the WBS Management Team did not receive reports related to violations committed by Company Organs and Bank NTB Syariah Personnel, thus not serving sanctions / follow-up on complaints that have been processed in 2020. 377 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  379. HANDLING OF CONFLICTS OF INTEREST In order to safeguard the interests of Shareholders , the Bank always upholds personal integrity and noble professionalism, which is outlined in the form of an internal policy regarding the Code of Ethics and Conduct Guidelines that must be obeyed by all levels of Directors, Commissioners, employees and parties related to cooperation with the Bank. The Code of Ethics and Conduct Guidelines have set things that must be avoided in order to prevent potential conflicts of interest in every activity, including in decision making. FORMS OF CONFLICT OF INTEREST SITUATION 1. 2. 3. 4. 5. 6. 7. Situations that cause Bank Management/Employees to receive gratuities or gifts for decisions that benefit the giver. Situations where the Bank's Management/Employees use their position for personal/group interests. Situations where confidential Bank or Position information is used for personal/group interests. Situations where the Bank's Management/Employees provide special access to certain parties, for example in employee recruitment without following the proper procedures. Situations that cause the monitoring process to not follow procedures due to the influence and expectations of the party being supervised. Situations where there is an opportunity for Bank Management/Employees to abuse their position/authority. Situations where the Bank's Management/Employees carry out other work outside of their main work as Bank Managers/Employees MECHANISMS OF HANDLING OF CONFLICTS OF INTEREST 1. Handling Conflicts of Interest for Bank Managers/Employees with the Potential to be in a Conflict of Interest Situation a. Bank Management/Employees who are potentially in a conflict of interest situation are prohibited from continuing their activities/carrying out tasks and responsibilities related to the conflict of interest situation. b. Bank Management/Employees who are potentially in the situation as referred to in point a, may resign from a task that has the potential to have a conflict of interest or decide not to be involved in the decision-making process related to activities that have a conflict of interest. Spirit of Amanah, Optimistic and Growth in Sustainable Business Bank Management/Employees who are potentially in a conflict of interest situation as referred to in letter a, in the event of certain considerations, business partners/third parties may ask those concerned to continue their activities/carry out their duties and responsibilities. d. Bank Management/Employees who have blood relations with direct superiors are required to make a Potential Conflict of Interest Statement. e. Bank Management/Employees involved or have the potential to be directly involved in a conflict of interest situation, must report to the Direct Supervisor by submitting a Potential Conflict of Interest Statement. c. 2. Handling Conflicts of Interest for Bank Managers/ Employees Who Know the Potential Conflict of Interest. Bank Management Employees who are aware of potential conflicts of interest, can report to their direct supervisor by submitting a Potential Conflict of Interest Statement. 3. Parties Knowing There is a Potential Conflict of Interest a. Business Partners/Third Parties and Communities that do not have direct involvement, but are aware of potential conflicts of interest, can report to the Bank through the Whistle Blowing System. The reporting mechanism through the Whistle Blowing b. System as referred to in letter a above is regulated in the Directors' Decree on the Anti-Fraud Strategy Policy and Procedure. 4. A Potential Conflict Statement Letter, at least containing: a. Name of Bank Management/Employee who has the potential to cause a conflict of interest. b. Positions. c. Actions/main problems that have the potential to cause a conflict of interest. Throughout 2020, there were no problems of conflict of interest involving company management that caused losses or reduced the Bank's profits. One of the company's efforts in implementing good corporate governance related to conflicts of interest, namely the recommendation not to receive gifts during the Eid is conveyed through internal media to all Management and Employees of Bank NTB Syariah. PT Bank NTB Syariah. 2020 Annual Report 378
  380. Good Corporate G ove r n a n c e NON-HALAL INCOME AND ITS USAGE Non-halal income and its use in Islamic banks must be disclosed in the annual GCG implementation report , this is regulated in SEBI No.12 / 13 / DPbS, dated April 30, 2010, regarding the Implementation of Good Corporate Governance for Islamic Commercial Banks and Sharia Business Units. As a form of GCG implementation related to non-halal income and its use, the Bank has internalized these rules in the Decree of the Board of Directors Number: SK / 01/64/0003/2020 dated January 17, 2020 concerning SOP for the Management of the PT Bank NTB Syariah Virtue Fund Program. The SOP regulates the following matters: 1. The Virtue Fund is a Bank fund sourced from the insurance agreement for the partnership of the Sharia NTB Bank used for charity programs (donations & sponsorships) and / or Community Development (Individual, Community / Group Development) and Productive Group Development which is stated in rupiah currency. which is expected to provide benefits now or in the future for the Bank and / or the object that is being provided with financial assistance. 2. The Virtue Fund Program is generally aimed at: a. Community Social Program implemented by PT Bank NTB Syariah as a tangible manifestation of the Bank's participation, attention and concern in helping the community and the Bank's environment. b. Charity Program (donation & sponsorship) and / or Community Development (Individual, Community / Group Development) and Productive Group development. The report on the source and use of Bank NTB Syariah's 2020 virtue fund is listed in the Analysis Chapter MAXIMUM LIMIT OF FUND DISTRIBUTION The Maximum Limit of Funds Distribution at Banks is implemented with reference to the provisions of Bank Indonesia Regulation Number: 7/3 / PBI / 2005, Bank Indonesia Regulation Number: 8/13 / PBI / 2006 concerning Amendments to Bank Indonesia Regulation Number: 7/3 / PBI / 2005 and Bank Indonesia Circular Letter Number: 7/14 / DPNP dated April 18, 2005 concerning the Maximum Credit Limit for Commercial Banks. The process of providing funds to related parties and / or providing large funds follows the normal financing process without exception with full approval authority at the Head Office level up to the Board of Directors and Commissioners level. Prior to approval of financing to related parties and / or large amounts of financing, a review of the Head Office and Compliance analyst / reviewer is required. During the period of 2020, there were no violations or exceedances of the Maximum Fund Distribution Limit (BMPD) and it has been reported regularly to the Financial Services Authority (OJK) in a timely manner in accordance with the provisions. 379 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  381. BUYBACK SHARES AND BUYBACK BONDS Based on SE BI Number : 12/13 / DPbS dated April 30, 2010 regarding the implementation of GCG for Sharia Commercial Banks and Sharia Business Units, what is meant by Buy back shares and buy back bonds is an effort to reduce the number of shares or bonds that have been issued by buying return of said shares or bonds, the payment procedure is carried out in accordance with the applicable regulations. Throughout 2020, the Bank did not buy back shares or buy back bonds. ASSESSMENTS OF GOOD CORPORATE GOVERNANCE IN 2020 SELF ASSESSMENT One of the assessment points for the Bank's soundness level is a self-assessment of the implementation of the principles of Good Corporate Governance (GCG) in the bank. Self-assessment is carried out periodically every semester, namely in June and December of the current year. This self-assessment is intended to map the strengths and weaknesses of the implementation of GCG in Bank NTB Syariah in terms of three aspects, namely; Governance Structure, Governance Process and Governance Outcome. The self assessment includes 11 (eleven) GCG implementation assessment factors which include: 1. Implementation of Duties and Responsibilities of the Board of Commissioners; 2. Implementation of Duties and Responsibilities of the Board of Directors; 3. Completeness and Implementation of Committee Duties; 4. Implementation of Duties and Responsibilities of the Sharia Supervisory Board; 5. Implementation of Sharia Principles in Fundraising and Fund Distribution and Services Activities; 6. Handling of Conflict of Interest; 7. Implementation of Compliance Function; 8. Implementation of the Internal Audit Function; 9. Implementation of the External Audit Function; 10 Maximum Fund Distribution Limit (BMPD); and 11. ransparency of the Bank's Financial and Non-Financial Conditions, Report on the Implementation of Good Corporate Governance and Internal Reporting. PARTIES CONDUCTING THE ASSESSMENT The process of Bank NTB Syariah Governance Self Assessment assessment involves the entire Board of Commissioners, Directors and Work Units related to the said governance assessment factors. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 380
  382. Good Corporate G ove r n a n c e RATING RESULTS The Bank has submitted the results of self-assessment on GCG implementation to OJK every year . For GCG assessment in 2020, Bank NTB Syariah still refers to Bank Indonesia Regulation Number: 11/33 / PBI / 2009 dated 7 December 2009 concerning Implementation of Good Corporate Governance for Sharia Commercial Banks and Sharia Business Units, with a Composite Rating of 2 (two) Or the predicate category "Good". With the following conclusions: Ratings Individual 1. 2,00 Rate Definitions Reflecting that the Management of the Bank has implemented Good Corporate Governance ingeneral Good. This is reflected in the adequate fulfillment of the Governance Principles. If there are weaknesses in the application of governance principles, in general, these weaknesses are insignificant and can be resolved by normal actions by Bank Management. Implementations of the Duties and Responsibilities of the Board of Commissioners a. Governance Structure Weakness Strengthing Factors The number of members of the Board of Commissioners is 3 (three) people. The number of Independent Commissioner members is 2 out of 3 members of the Board of Commissioners, namely: 1 Independent President Commissioner and 1 Independent Commissioner. b. 2 (two) members of the Board of Commissioners are still in the process of following the fit and proper test to obtain approval from the Financial Services Authority (OJK). Governance Process Strengthing Factors Weakness The Board of Commissioners has held 35 meetings. c. - Governance Outcome Strengthing Factors The results of the Board of Commissioners Meeting have been recorded in the minutes of the meeting, which will then be submitted to the Board of Directors as a form of Advice to the Board of Commissioners. 2. Weakness So far, the owner has never intervened in the composition and implementation of the duties of the Board of Commissioners, however, a coordination mechanism between the owner and the Board of Commissioners is still needed in the Bank's operational activities. Implementations of the Duties and Responsibilities of Directors a. Governance Structure Strengthing Factors The number of members of the Board of Directors is 3 (three) and all members of the Board of Directors have at least 5 years of experience in the operational field as Executive Officers of the Bank. b. Weakness 4 (four) Candidates for members of the Board of Directors for 2 (two) Director formations (Director of Compliance & MJR and Director of Funds & Services), are still in the process of following a fit and proper test to obtain approval from the Financial Services Authority (OJK). Governance Process Strengthing Factors Direksi telah melaksanakan Rapat sebanyak 48 kali. 381 PT Bank NTB Syariah. 2020 Annual Report Weakness Internal processes still need to be improved so that sanctions / reprimands from regulators can be minimized. Spirit of Amanah, Optimistic and Growth in Sustainable Business
  383. c . Governance Outcome Weakness Strengthing Factors The Board of Directors has communicated to employees about the direction of the bank's business in order to achieve the mission and vision of the bank 3. There are still fines and findings that have not been resolved. Completeness and Implementations of Committee Duties a. Governance Structure Strengthing Factors Weakness The composition of the Committee has met the requirements without any intervention from the owner. b. - Governance Process Strengthing Factors Weakness The Committee has held 77 meetings consisting of: 1. Audit Committee Meetings 34 (thirty four) times. 2. The Risk Monitoring Committee has met 36 (thirty six) times. 3. Remuneration and Nomination Committee 7 (seven) times. c. - Governance Outcome Weakness Strengthing Factors The results of Committee meetings have been recorded in minutes of meetings and are well documented. Until the report date, there were no dissenting opinions. 4. Each Committee has carried out its functions according to applicable regulations, although there are minor weaknesses, they can be resolved immediately. Implementations of Duties and Responsibilities of Sharia Supervisory Board a. Governance Structure Strengthing Factors All members of the Sharia Supervisory Board have passed the competency test and all of them have obtained a letter of approval from DSN MUI. b. In accordance with the Resolution of the GMS on April 22, 2020, there are 1 (one) members of the DPS. Governance Process Strengthing Factors The Sharia Supervisory Board always provides advice and suggestions to the Board of Directors on various issues related to syariah and supervises Bank activities to comply with Sharia Principles. c. Weakness Weakness - Governance Outcome Strengthing Factors The Sharia Supervisory Board has submitted the Sharia Supervisory Board Supervision Result Report semiannually to the OJK on time. Spirit of Amanah, Optimistic and Growth in Sustainable Business Weakness The Supervision Result Report submitted by the Sharia Supervisory Board to the OJK still has a review / needs to be readjusted. PT Bank NTB Syariah. 2020 Annual Report 382
  384. Good Corporate G ove r n a n c e 5 . Implementations of Sharia Principles in Funds Collecting and Funds Distribution and Services a. Governance Structure Strengthing Factors Strengthing Factors The Bank has 2 (two) members of the Sharia Supervisory Board, who have sufficient competence regarding Sharia Banking operations. b. The Bank's new product development process has taken into account the fatwa of the National Sharia Board and has received a Sharia Opinion from the Sharia Supervisory Board. c. Weakness - Governance Outcome Strengthing Factors Products owned by the Bank are in accordance with the Fatwa issued by the National Sharia Board and are equipped with adequate SOPs. Weakness - Handling Conflicts of Interest a. Governance Structure Strengthing Factors The Bank has policies, systems and procedures for resolving conflicts of interest which have been stipulated in the Decree of the Board of Directors regarding Guidelines for Handling Conflict of Interest. b. During the reporting period, the Bank never experienced a Conflict of Interest so that the Management and Executive Officers did not take action to resolve it. c. Weakness - Governance Process Strengthing Factors Weakness - Governance Outcome Strengthing Factors Owners / related parties / other parties have never intervened in the Bank's activities that could create a conflict of interest that could harm the Bank or reduce the Bank's profits. 7. In accordance with the Resolution of the GMS on April 22, 2020, there are 1 (one) members of the DPS. Governance Process Strengthing Factors 6. Weakness Weakness Weakness - Implementations of the Bank's Compliance Function a. Governance Structure Strengthing Factors The appointment and appointment of the Compliance Director is in accordance with applicable regulations 383 PT Bank NTB Syariah. 2020 Annual Report Weakness - Spirit of Amanah, Optimistic and Growth in Sustainable Business
  385. b . Governance Process Strengthing Factors The appointment and appointment of the Compliance Director is in accordance with applicable regulations c. Compliance reports to the Financial Services Authority (OJK) are made in a timely manner and have never been sanctioned for late reporting. Weakness There are repetition of types of violations in the form of external reports that result in fines. Implementations of the Internal Audit Function a. Governance Structure Strengthing Factors The Bank's SKAI organizational structure is in accordance with the applicable regulations b. The Bank has implemented the internal audit function effectively in all aspects and elements of activities that are expected to directly affect the interests of the Bank and the public. c. Weakness - Governance Process Strengthing Factors Weakness - Governance Outcome Strengthing Factors The Bank has followed up both internal and external audit findings (DMTL). DMTL audit findings until the position of December 2020, there are 19 findings from external parties and 139 findings from internal parties 9. The Bank has properly identified, measured, monitored and controlled compliance risks, although there are minor weaknesses, they can be resolved immediately. Governance Outcome Strengthing Factors 8. Weakness Weakness Masih terdapat temuan berulang. Implementations of the External Audit Function a. Governance Structure Strengthing Factors The Bank has appointed a Public Accountant and KAP in accordance with the prevailing rules and regulations and has been approved by the GMS. b. Weakness - Governance Process Strengthing Factors The Public Accountant has reported the audit results and Management Letter to the Financial Services Authority in a timely manner. Spirit of Amanah, Optimistic and Growth in Sustainable Business Weakness - PT Bank NTB Syariah. 2020 Annual Report 384
  386. Good Corporate G ove r n a n c e c . Governance Outcome Strengthing Factors The results of the audit and the Management Letter have described significant bank problems and are submitted in a timely manner to the Financial Services Authority by the appointed KAP. Weakness - 10. Maximum Limit of Fund Distribution a. Governance Structure Strengthing Factors The Bank has adequate written policies, systems and procedures for provision of funds to related parties and provision of large funds, and periodic monitoring has been carried out in accordance with BI / OJK regulations. b. The Bank is always trying to solve all problematic financing. Governance Process Strengthing Factors The Bank has periodically evaluated and updated its policies, systems and procedures to comply with the prevailing laws and regulations. c. Weakness Weakness - Governance Outcome Strengthing Factors The implementation of provision of funds by the Bank to related parties and / or provision of large funds has met the applicable provisions concerning the Maximum Funds Distribution Limit (BMPD) and has taken into account the prudential principles and applicable laws and has taken into account the Bank's capital capacity. Weakness - 11. Transparency of Financial and Non-Financial Conditions, GCG Implementation Reports and Internal Reporting a. Governance Structure Strengthing Factors The Bank has policies and procedures for implementing transparency on financial and non-financial conditions. b. The Bank always delivers procedures for customer complaints as well as procedures for resolving disputes to all Bank customers in accordance with the provisions of the Financial Services Authority concerning Customer Complaints and Banking Mediation. Weakness - Governance Outcome Strengthing Factors The GCG implementation report is prepared every year containing matters that must be submitted in accordance with applicable regulations and submitted completely and on time and can be accessed on the website. 385 The Bank already has an adequate Management Information System, although in its implementation it still requires the support of competent resources and a quality IT Security System. Governance Process Strengthing Factors c. Weakness PT Bank NTB Syariah. 2020 Annual Report Weakness - Spirit of Amanah, Optimistic and Growth in Sustainable Business
  387. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 386
  388. CORPORATE SOCIAL RESPONSIBILITY Methods of Implementing CSR Programs CSR Programs and Management Source of Funds for CSR Programs Realization of CSR Programs Corporate Social Responsibility towards the Environment Corporate Social Responsibility Towards Social and Community Corporate Social Responsibility Towards Employment , Health and Work Safety (K3) Corporate Social Responsibility towards Social Products/Services and Customers 389 390 391 392 393 394 397 399
  389. 07
  390. Corporate Social Responsibilty CORPORATE SOCIAL RESPONSIBILITIES METHODS OF IMPLEMENTING CSR PROGRAM The implementation of Corporate Social Responsibility (CSR) at Bank NTB Syariah is a shape of commitment to manage business balance in actualizing the expectations of all stakeholders. CSR identifies as a moral agent that delivers additional point value to stakeholders. Bank NTB Syariah always tries to provide the best for the community and the surroundings by completing clear-cut activities of corporate social responsibility that promote harmonious relation with the social environment in various forms of partnership programs and community development in order to establish a reputation as sustainable company. The distribution of CSR funds was managed based on the principles of transparency, accountability, responsibility, independency, fairness and compliance with regulations; on the principles of benefit and efficiency of the broader community; and on the principles of Good Corporate Governance (GCG). The CSR of Bank NTB Syariah was implemented in 2 (two) ways: 1. Programs of community and environmental empowerment initiated by the Regional Government; 2. Programs of community and environmental empowerment initiated by Bank NTB; Bank NTB Syariah contributed in community and environmental empowerment with beneficial and sustainable programs and continued to spread the programs of CSR to the right target with the support of shareholders. In this report, Bank NTB Syariah presented information about CSR activities that had been implemented in 2020. The basis of implementing CSR of Bank NTB Syariah referred to the applicable laws and regulations in creating and implementing CSR programs related to environmental conservation, education, health, social community, natural disasters, religion, sports and other social programs that aligned with the Regional Government programs. The programs were completely fulfilled by the Bank that required by the laws and regulations as follows: 1. Law of Republic Indonesia No. 40 of 2007 concerning Limited Liability Companies; 2. Decision of the Annual General Meeting of Shareholders (AGM) of PT Bank NTB Syariah which stated that CSR funds were budgeted from net income; 3. Decree (SK) of the Board of Directors of PT Bank NTB Syariah No: SK.01.22 / 64/0698/2020 dated on 27th October 2020, concerning the Company Manual Book (BPP) Costs Controlling of Bank NTB Syariah Corporate Social Responsibility (CSR). CSR Purposes Helping community empowerment to obtain welfare Sectors - Education Religious Health Sports Natural disasters Nature Conservation Society, arts and culture CSR Distribution Patterns - Programs initiated by the Regional Government - Program initiated by Bank NTB Syariah. 389 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  391. CSR PROGRAMS AND MANAGEMENTS The unit of Corporate Secretary that managing and structuring CSR programs collaborated with third party , i.e academics, government agencies, humanitarian agencies and social institutions paid attention to the programs efficiently and effectively. The unit also evaluated and monitored all CSR programs that had been carried out in order to achieve predetermined goals. PRESIDENT DIRECTOR Desk Head Corporate Secretary Supervisor Supervisor Public Relations CSR Analyst Secretariat Executive Secretary of Board of Commissioner Sharia Supervisory Board Staff Administrative Assistant/ Secretary of the Board of Directors Administrative Assistant/ Secretary of the Board of Commisioner Administrative Assistant Public Relation Analyst Administrative Assistant Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 390
  392. Corporate Social Responsibilty SOURCE OF FUNDS FOR CSR PROGRAMS Bank NTB Syariah allocated 5 % of the profit recorded to carry out the CSR program every year. The amount of CSR funds at the Head Office and each Branch Office was distributed based on the percentage share of paid-up capital of each Shareholder in the region/ location of the branch office. The distribution of authority included: a 94% of the Shareholders authority was divided according to the share of capital; b. 6% of Bank NTB Syariah authority. The alloction of budgeting fund in 2020 was determined as follows: (in rupiah) No Description Budget in 2020 A. Fund Management synergized with Regional Government Programs 1. Province of NTB 2. Sumbawa District 739,151,860 3. East Lombok District 744,906,402 4. Dompu District 573,973,459 5. Central Lombok District 594,091,341 6. West Sumbawa District 392,528,883 7. West Lombok District 258,302,251 8. Bima District 375,449,400 9. North Lombok District 317,067,644 10. Mataram 268,307,483 11. Bima City 99,684,029 Sub. Total (94%) 7,672,723,927 B. Fund Management by Bank NTB Syariah 1. Head Office Sub. Total (6%) Grand Total 391 PT Bank NTB Syariah. 2020 Annual Report 3,309,261,175 489,748,336 489,748,336 8,162,472,263 Spirit of Amanah, Optimistic and Growth in Sustainable Business
  393. REALIZATION OF CSR PROGRAMS The CSR fund allocation of Bank NTB Syariah in 2020 was used as follows : (in rupiah) No Realization Per CSR Sector 1. The budget 2. Realization Realization CSR Budget in 2020 Regional/Regency/City Government Bank NTB Syariah 7,672.723.927 489,748.336 • Education 3,031,489,577 92,711,825 • Religious 2,003,923,000 20,000,000 • Health 105,000,000 35,557,000 • Sports 490,000,000 44,000,000 • Natural disasters 235,000,000 17,250,000 • Nature Conservation 112,000,000 42,175,000 • Society, Art and Culture 727,680,000 45,000,000 • Economic Empowerment 468,825,000 54,175,000 7,173,917,577 350,868,825 93.50% 71.64% Total Realization Percentage Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 392
  394. Corporate Social Responsibilty CORPORATE SOCIAL RESPONSIBILITIES TOWARDS THE ENVIRONMENT In order to ful fill its responsibility for environmental protection, the bank always has a strong commitment to manage the environmental. This commitment is manifested by participating in environmental preservation programs setting first in the internal surroundings. IMPLEMENTATION OF ACTIVITIES In line with the mission "NTB ZERO WASTE 2023" which is a priority program of the NTB Provincial Government, Bank NTB Syariah collaborated with Nahdhatul Ulama University (UNU) NTB to establish a Waste Bank to promote "NTB free of waste". Garbage becomes problem in almost all regions in Indonesia, one of which is in the NTB province. The Zero Waste Program uses waste as a resource by applying a concept based on reducing the amount of waste and reusing waste; and of a circular economy targeting 70% of waste processed and 30% of waste reducted. In addition, Bank NTB Syariah applies sustainable finance principles that integrate environmental risk and social and governance (LST) risk in financial products and services. This had been applied by Bank NTB Syariah in the form of: 1. The requirements in financing of Bank NTB Syariah, there is required to provide document of an Environmental Management Effort (UKL / UPL) and / or Environmental Impact Analysis (AMDAL); 2. Bank NTB Syariah has a policy to prohibit the provision of financing that damages the environment; 3. Bank NTB Syariah implements Anti-Money Laundering and Terrorist Financing Prevention (APU-PPT) policies, which one of the obligations is to report transactions that are against the law such as business transactions related to illegal logging and environmental pollution. 393 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  395. CORPORATE SOCIAL RESPONSIBILITY TO SOCIAL AND COMMUNITY The Limited Liability Company Law claims that CSR aims for sustainable economic development in order to improve the quality of life and the environment that is bene ficial for the company itself, the local community and society in general. Therefore, Bank NTB Syariah continues to carry out CSR programs seriously, so that all CSR programs have a broad impact and have a significant effect on community development. The CSR program is a part of an obligation to maintain the bank’s existence and a form of effort to contribute in the economic growth of the community. IMPLEMENTATION OF ACTIVITIES In 2020, Bank NTB Syariah completed some programs related to social and community sector that covered education, religion, health, natural disaster and society, arts and culture as the following table: 1. CSR Programs in Natural Disaster Sector The following table describes the participation of Bank NTB Syariah in mitigating natural disasters in West Nusa Tenggara i.e in the East Lombok and North Lombok throughout 2020: Date 2. Activity September 09, 2020 Subsidies for fire victims in North Lombok September 15, 2020 Distribution of clean water in drought-prone areas in the East Lombok region November 03, 2020 Distribution of water pump machine in Sumbawa CSR Programs in Education Sector Education is the main foundation in deriving more knowledge and cultivating the quality of society life. Bank NTB Syariah participated to attain the Government's goal in increasing the level of education in terms of various CSR programs (targeted focus of company) as follows: Date 3. Activity February 24, 2020 Scientific Ability Development, Event I - FEST 2020 February 27, 2020 Development of Electric Garbage Car July 20, 2020 Contruction of House of Tahfidz Darul Hijrah Hidayatullah September 28, 2020 Achievement scholarship and less fortunate aid for the NTB’s scholar at Tazkia Institute December 15, 2020 Laboratorium equipment for Hamzanwadi University CSR Programs in Religious Sector Bank NTB Syariah contributed in the religious program such as building or renovating mosques and supporting religious events/ activities, such as: Date Activity May 11, 2020 Procurement of air conditioning at the Al Falah Mosque July 20, 2020 2020 Mosque Takmir Training August 19, 2020 Activity Life Lombok Islamic Festival September 25, 2020 Construction of the Umar Bin Khattab Mosque September 02, 2020 COUNCIL V of the Indonesian Christian Student Movement (GMKI) Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 394
  396. Corporate Social Responsibilty 4 . CSR Programs in Health Sector The health sector was one of the aspects that become the focus of the development of the CSR program which was providing medical expenses to people in need in West Nusa Tenggara province. It was hoped that this program could benefit the victims to help them get better and improve their health. The following was the programs conducted: Date 5. Activity February 21, 2020 Free Medical check-up and treatment for free at Sakra Village, East Lombok July 14, 2020 Medical aid funds for Muh. Asyraaf who was suffering from heart defects CSR Programs in Society, Arts & Culture Sector This program was held with the aim of empowering the community in a sustainable manner organized by the company to observe the development of community welfare thoroughly. The policy was carried out by defining the right programs to accomplish the target and provide maximum benefits according to prevailing laws and regulations. Some of the programs included: Date February 02, 2020 Activity NTB Youth Art Talent Development through Fashion Show and Singing Competitions by Mahardika NTB Art Studio March 02, 2020 Development of the potential for local NTB weaving through the 2020 Muslim Fashion Festival August 14, 2020 Provincial CSR for Independent Day Video Contest by LPP NTB November 19, 2020 Construction of the Indonesian Music Lantern Art Hall March 31, 2020 Construction of Orphans and Dhuafa Houses at the Samawa Intan Kalanis Sumbawa Foundation July 20, 2020 Development and introduction of geotourism and a virtual geopark event geotourization festival by geopark Rinjani December 11, 2020 Putra Indonesia Election IMPACTS Bank NTB Syariah realized that society was one of the important elements in carrying out business commotions. Throughout 2020, Bank NTB Syariah had structured community social programs consistently and sustainably so that the positive impact was to increase the image of Bank NTB Syariah and to develop a better community of NTB. 395 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  397. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 396
  398. Corporate Social Responsibilty SOCIAL RESPONSIBILITY TOWARDS EMPLOYMENT , HEALTH AND SAFETY (K3) Human Resources are the main agent in the company and have a central role in managing other resources owned by the company. Every employee of Bank NTB Syariah is a valuable and significant asset in the development of sustainable business of a company. Hence, Bank NTB Syariah is committed to develop sustainable human resources in terms of the quality, competency, character, career and welfare of each employee to foster a state of comfort and pride working for Bank NTB Syariah. IMPLEMENTATION OF ACTIVITIES The development of banking businesses industry is certainly supported by quality of human resources management. Bank NTB Syariah persists to implement good management of human resources and take into account the employee welfare involved provincial minimum wage, human rights, recognition of diversity i.e. race, ethnicity, religion and gender, and equality. 1. Employee Welfare Bank NTB Syariah remains to create a well-balanced relation between the company and employees by always focusing the welfare of all employees. The employee welfare is crucial feature that help the employees to increase their motivation, be more productive and more committed to the company. Therefore, Bank NTB Syariah provides BPJS Employment and BPJS Healthcare that covered health insurance, production services, holiday allowances, paid leave, pocket money, death benefits, annual leave, maternity leave, bereavement leave in accordance with applicable laws, fulfillment of regional minimum remuneration and employee financing. Bank NTB Syariah also enrolls its employees in defined-contribution plans and defined-benefit plans. 2. Education and Training of Employees Along with the rapid development of technology, the competitive environment of banking industry and the increasing of achievement targets, Bank NTB Syariah maintained to boost the employee potential by arranging various educations and trainings regularly. Through a series of learning programs, Bank NTB Syariah required the employees to thrive and actualize their best performance to tackle any challenges or changes in a competitive business environment. During 2020, various kinds of training had been executed which can be seen in the Company Profile Chapter. 3. Gender Equality and Job Opportunities Bank NTB Syariah truly considered equality of gender, broad career opportunities and employment to all employees regardless of gender, race, ethnicity and religion. Every employee was ensured to receive the same treatment and chances for self-competency improvement and promotion. 4. Remuneration of Employees Bank NTB Syariah provided compensation based on the employees performance referred to the Provincial Minimum Wage (UMP) stipulated by the Government. Bank NTB Syariah attempted to maintain the salary ratio of all employees with the purpose of avoiding vast wage gab amongst the employees. The remuneration in 2020 included: (in rupiah) No Activity Highest Lowest Ratio 1. The highest and lowest permanent employees’ salary ratio 21,808,216 2,562,500 12% 2. The highest and lowest Directors' salary ratio 57,500,000 51,750,000 90% 3. The highest and lowest Commissioners’ salary ratio 40,250,000 36,225,000 90% 4. The highest salary ratio for Directors and permanent employees 57,500,000 21,808,216 4.38% 397 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  399. 5 . Health and Work Safety Creating a conducive and comfortable work environment is certainly needed in increasing the productivity of employee performance. Healthy employees can carry out their duties optimally. Therefore, Bank NTB Syariah generated occupational health and safety as a priority in the management of human resources. Bank NTB Syariah was fully committed to fulfilling the employee protection against various risks of accidents in the workplace such as fire or natural disasters, as well as health protection that involved: a. Medical check-up to identify any early sign of health issues and determine the level of fitness and general health; b. Offering BPJS healthcare and health insurance facitilities; c. Smoking prohibition at the workplace. IMPACTS Realizing the important role of Human Resources as the main asset determining the success of business actions, Bank NTB Syariah seeked to enhance the management of human resources with compensating all employees in order to create a professional, harmonious, safe, and comfortable work environment so that the employees performed their duties in finest to achieve the company’s targets successfully. Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 398
  400. Corporate Social Responsibilty SOCIAL RESPONSIBILITIES TOWARDS PRODUCTS /SERVICES AND CUSTOMERS As a financial institution, the bank not only demands to achieve profitability based on the business plan but also to be responsible for the needs of customers. As a result, Bank NTB Syariah continues to provide complete and comprehensive information about financial services and products offered to customers. Bank NTB Syariah realizes that quality service is the key to maintain customer reliability and business stability. IMPLEMENTATION OF ACTIVITIES Several programs executed by Bank NTB Syariah concerning social responsibility to products/ services and customers which involved customer complaint services and product information. 1. Customer Complaint Services Bank NTB Syariah recognizes effective and high quality customer service is real in terms of ensuring that customer complaints are handled in a friendly, fast, fair, polite and effective manner. Bank NTB Syariah has a unit that manages consumer complaints, Customer Service, that are available in each Branch and Sub-Branch Office. The complaints also can be delivered through social media i.e. Facebook and Instagram managed by the Corporate Secretary Desk. The service mechanism and settlement of customer issues presented as follows: a. Oral Complaint Resolutions: 1) Receiving and serving the customers who complain verbally. The complaint is coordinated by Customer Service by showing evidence or documents of the customer complaints. 2) Customer Service operator records the complaints accepted in Register of Customer Complaint and fill the other customer 3) complaint form. Customer Service operator coordinates with Deputy Main Branch Manager of Service / Deputy Branch Manager / Deputy Sub Branch Manager and obligates to give feedback to the customers no later than 2 working days after the day of 4) complaint received. After handled by Customer Service, it is mandatory for Customer Service to write reports about the complaints and resolution to branch manager based on the Customer complaint resolution form stated in Enclosure III of the decree. 5) Concerning the problems that required decisions under the authority of the Head Office, the complaint is monitored by the Branch Manager and delivered to the Board of Directors. 6) In order to resolve customer complaints, the Corporate Secretary Desk coordinates with the relevant units that have a connection with the problems reported by the Customer. 7) The Corporate Secretary Desk and /or the relevant unit must immediately follow up the problems and resolve them no later than 20 (twenty) working days after the day of the complaint received. 8) In certain conditions, the Corporate Secretary's Desk and / or Relevant Units may extend the period of time up to a maximum of the 20 (twenty) working days. 9) Certain conditions as referred to in number 8 include: a) The Bank that received complaints is not the same the Bank where the problem is reported and there are communication problems between the two Banks; b) Financial transactions that are complained by Customers required specific investigation on the documents; and / or c) There are other difficulties out of the control of the Bank, such as the involvement of third parties outside the Bank in financial transactions performed by the Customer. 10) The extension of the period of time to resolve the complaints as mentioned in number 8 has to be notified in writing to the Customer who submited the complaint before the period referred to number 7 ends. 11) After compiling the responses of complaints, the Company Secretary Desk and / or Relevant Unit is required to submit it to the Branch Office to be forwarded to the Customer. 12) After the complaint is resolved by the Branch Office, the Branch Office has to report it to the Board of Directors via the Desk of the Corporate Secretary. 399 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  401. b . Written complaint resolution 1) Receiving and serving customers who complain in writing. The complaint can be addressed directly to Customer Service by showing evidence or documents of customer complaints along with a copy of valid identification. 2) Customer Service operator notes the complaints received in Register of Customer Complaint and deputy manager of each office proceeds the complaints to manager of main branch/sub-branch. 3) Branch manager assigns Customer Service to resolve customer complaints in coordination with the Related Supervisor within 2 (two) working days after the day of the complaints received. 4) Regarding the problems that required decisions under the authority of the Head Office, the complaint is delivered by the Branch Manager to the Board of Directors through the Desk of the Corporate Secretary. 5) In order to solve customer complaints, the Corporate Secretary Desk coordinates with the relevant units that have a connection with the problems reported by the Customer. 6) The Corporate Secretary Desk and /or the relevant unit have to immediately take an action to resolve the problems no later than 20 (twenty) working days after the day of the complaint received. 7) In certain conditions, the Corporate Secretary's Desk and / or Relevant Units may extend the period of time up to a maximum of the 20 (twenty) working days. 8) Certain conditions as referred to in number 7 include: a) The Bank that received complaints is not the same the Bank where the problem is reported and there are communication problems between the two Banks; b) Financial transactions that are complained by Customers required specific investigation on the documents; and / or There are other difficulties out of the control of the Bank, such as the involvement of third parties outside the Bank in c) financial transactions performed by the Customer. 9) The extension of the period of time to resolve the complaints as mentioned in number 7 has to be notified in writing to the Customer who submits the complaint before the period referred to number 6 ends. 10) After compiling the responses of complaints, the Company Secretary Desk and/or Relevant Unit is required to submit it to the Branch Office to be forwarded to the Customer. 11) After the complaint is resolved by the Branch Office, the Branch Office have to report it to the Board of Directors via the Desk of the Corporate Secretary. 12) For written complaints submitted directly to the Board of Directors / Head Office of the Bank, the Board of Directors can assign the Corporate Secretary Desk to coordinate the complaint resolution with relevant units at the Head Office and / or or Branch Offices / Sub-Branch Offices. The complaint must be completed within no later than 20 (twenty) working days after the day of complaint received. 13) In certain conditions, the system in number 7, 8 and 9 shall apply. 14) After compiling the responses of complaints, the Company Secretary Desk and/or Relevant Unit are required to distribute it to the Customer, copied to the board of Directors. During 2020, the Corporate Secretary unit had submitted reports on Customer Complaint Service and Customer Complaint Resolution to OJK every quarter through the web-based application "SI PEDULI", with the following details: Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 400
  402. Corporate Social Responsibilty During 2020 , the Corporate Secretary unit had submitted reports on Customer Complaint Service and Customer Complaint Resolution to OJK every quarter through the web-based application "SI PEDULI", with the following details: Period Quarter I Quarter II Quarter III Quarter IV Total 2. Total 2,410 2,657 2,456 2,809 10,332 Follow-Up Completed incomplete 2,410 2,657 2,456 2,809 10,332 - In Progress - Product and Services Information Bank NTB Syariah provides thorough information about the product and services via print and electronic media. Besides, information about product and services can be obtained in each branch office at the customer service counter or by calling up the Call Center 1500667. Moreover, further information about product and services, branch offices and ATM network can also be accessed in www.bankntbsyariah.co.id and social media. IMPACTS By carrying out social responsibility programs to products and/or services, customers were expected to be contented as the bank guarantee the safety of the transactions in order to increase the customers’ reliability. 401 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  403. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 402
  404. FINANCIAL REPORTS 2020 01 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
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  406. PT BANK PEMBANGUNAN DAERAH NUSA TENGGARA BARAT SYARIAH LAPORAN KEUANGAN / FINANCIAL STATEMENTS UNTUK TAHUN YANG BERAKHIR 31 DESEMBER 2020/ FOR THE YEAR ENDED 31 DECEMBER 2020 DAN/AND LAPORAN AUDITOR INDEPENDEN/ INDEPENDENT AUDITORS’ REPORT 03 PT Bank NTB Syariah. 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  407. PT BANK PEMBANGUNAN DAERAH NUSA TENGGARA BARAT SYARIAH LAPORAN KEUANGA UNTUK TAHUN YANG BERAKHIR 31 DESEMBER 2020 DAFTAR ISI PT BANK PEMBANGUNAN DAERAH NUSA TENGGARA BARAT SYARIAH FINANCIAL STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2020 Halaman / Pages Pernyataan Direksi CONTENTS Directors Statement Laporan Posisi Keuangan 6 Statement of Financial Position Laporan Laba Rugi dan Penghasilan Kemprehensif Lain 9 Statement of Profit or Loss and Other Comprehenve Income Laporan Ekuitas 11 Statement of Changes in Equity Laporan Arus Kas 12 Statement of Cash Flow Laporan Rekonsiliasi Pendapatan dan Bagi Hasil 14 Statement of Reconciliation of Income and Revenue Sharing Laporan Sumber dan Penyaluran Dana Zakat 15 Statement od Sources and Distribution of Zakat Funds Laporan Sumber dan Penggunaan Dana Kebajikan 16 Statement of Sources and Uses of Qardhul Hasan Funds Catatan Atas Laporan keuangan 17 Notes to The FInancial Statement Laporan Auditor Independen 106 Independent Auditors Report Spirit of Amanah, Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 04
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  476. 73 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  477. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 74
  478. 75 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  479. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 76
  480. 77 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  481. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 78
  482. 79 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  483. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 80
  484. 81 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  485. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 82
  486. 83 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  487. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 84
  488. 85 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  489. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 86
  490. 87 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  491. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 88
  492. 89 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  493. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 90
  494. 91 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  495. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 92
  496. 93 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  497. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 94
  498. 95 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  499. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 96
  500. 97 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  501. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 98
  502. 99 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  503. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 100
  504. 101 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  505. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 102
  506. 103 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  507. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 104
  508. 105 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  509. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 106
  510. 107 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  511. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 108
  512. 109 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business
  513. Spirit of Amanah , Optimistic and Growth in Sustainable Business PT Bank NTB Syariah. 2020 Annual Report 106
  514. 107 PT Bank NTB Syariah . 2020 Annual Report Spirit of Amanah, Optimistic and Growth in Sustainable Business