Governance

Emerging Risks

At BCA, we believe that various changes, including economic, environmental, and social changes, can have a significant impact on overall management, and we define and manage them as emerging risks.

Categories of emerging risks

BCA identifies two main categories of emerging risks that are continuously monitored. Both risks are analyzed in depth in terms of their definition, business impact, and the mitigation measures applied.

Categories of emerging risks

The Global Economic Volatility

Risk	The risk of cyber attacks	The Global Economic Volatility
Definition	The use of this technology may increases risks including system disruption, cyber-attacks, data leaks, and social engineering.	The global economic volatility (such as trade wars, Trump’s tariff, geopolitical tensions, and/or monetary tightening in major economies) can trigger fluctuations in Indonesia’s macroeconomics (exchange rates, interest rates, capital flows, etc.), potentially leading to a slowdown in domestic economy activity, which can impact the bank performance in terms of loans, funding and investment.
Risk Type	Technological	Economic
Business Impact	Any potential system disruptions or potential cyber-attacks could have implications and disrupt services to our customers.	The impact of the risk could include increased non-performing loans, pressure on net interest margins, decreased profitability, and potential declines in the value of investment portfolios. Consequently, the bank's overall financial performance will be affected.
Mitigation Actions	Bank implements IT and cyber security risk management in accordance to bank's strategy and regulatory guidance. The Bank is supported by a comprehensive organizational structure, where there is an IT Security Group (ISG), Cyber Security Risk Management Subdivision (CSM) and Internal Audit Division (DAI) as an integral part of the three lines of defense concept for risks related to cyber security. In addition, the Bank also has policies and procedures for cyber security risk management, as well as policies and procedures related to IT Security that refer to international standards.	To mitigate risks, BCA continues to enhance its risk management framework by closely monitoring macroeconomic indicators, conducting regular stress tests on its credit and market portfolios, diversifying its loan portfolio to avoid concentration risk, maintaining conservative capital buffers, and optimizing its liquidity position. Furthermore, BCA is taking a proactive approach with debtors, particularly those in vulnerable sectors. BCA believes these measures can mitigate the negative impact of global economic uncertainty.