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Loan Sale Agreement for Indonesia

Loan Sale Agreement Template for Indonesia

An Indonesian law-governed agreement that facilitates the transfer of loan assets from one financial institution to another. The document comprehensively addresses the sale mechanics, regulatory requirements, and compliance measures specific to Indonesian banking and financial services regulations. It includes provisions for loan transfer documentation, representations and warranties, price adjustment mechanisms, and relevant Indonesian regulatory approvals. The agreement ensures compliance with OJK (Financial Services Authority) requirements and Indonesian Civil Code provisions regarding assignment of rights and obligations.

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Loan Sale Agreement

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What is a Loan Sale Agreement?

The Loan Sale Agreement is a crucial document used in Indonesian financial markets when transferring loan assets between financial institutions. It is particularly relevant in scenarios involving portfolio restructuring, non-performing loan sales, or strategic asset disposals. The agreement must comply with Indonesian banking regulations, particularly OJK Regulation No. 42/POJK.03/2017 on asset quality assessment and relevant Bank Indonesia regulations. The document typically includes detailed provisions on loan transfer mechanics, regulatory compliance requirements, representations about the loan quality, and necessary approvals from Indonesian authorities. The agreement is essential for maintaining proper documentation of loan transfers while ensuring compliance with Indonesian banking and financial services regulations, including requirements for notification to borrowers and registration of security interests where applicable.

What sections should be included in a Loan Sale Agreement?

1. Parties: Identification of the Seller and Purchaser, including their complete legal names, registration numbers, and addresses

2. Background: Context of the transaction, including brief description of the original loan(s) and the parties' intention to transfer

3. Definitions and Interpretation: Definitions of key terms used throughout the agreement and rules of interpretation

4. Sale and Purchase: Core transaction terms including the commitment to sell and purchase the loan(s), and the scope of rights being transferred

5. Purchase Price and Payment: Details of the purchase consideration and payment mechanics

6. Conditions Precedent: Pre-completion requirements and conditions that must be satisfied before the transfer becomes effective

7. Completion: Process and mechanics for closing the transaction, including timing and delivery requirements

8. Representations and Warranties: Statements of fact and assurances from both parties, particularly regarding the loan assets being sold

9. Seller's Undertakings: Ongoing obligations of the Seller, including cooperation in the transfer process

10. Transfer and Notice: Mechanics for effecting the transfer and requirements for notifying relevant parties

11. Indemnities: Protection mechanisms and allocation of liabilities between parties

12. Confidentiality: Obligations regarding the confidential treatment of transaction information

13. Governing Law and Jurisdiction: Specification of Indonesian law as governing law and jurisdiction for disputes

14. Miscellaneous: Standard boilerplate provisions including notices, amendments, and severability

What sections are optional to include in a Loan Sale Agreement?

1. Security Assignment: Required when the loan(s) being sold are secured and the security interests need to be transferred

2. Currency Provisions: Needed for cross-border transactions or loans denominated in foreign currency

3. Tax Provisions: Detailed tax arrangements required for complex transactions or cross-border sales

4. Regulatory Compliance: Specific section needed when the transaction requires particular regulatory approvals or compliance measures

5. Sub-Participation: Alternative structure where legal title remains with seller but economic interest is transferred

6. Data Protection: Required when personal data is involved, particularly for consumer loans

7. Further Assurance: Additional cooperation obligations needed for complex transfers or multiple jurisdictions

What schedules should be included in a Loan Sale Agreement?

1. Schedule 1 - Loan Details: Detailed information about the loan(s) being sold, including principal amounts, interest rates, and payment terms

2. Schedule 2 - Conditions Precedent Documents: List of all documents required to be delivered before completion

3. Schedule 3 - Form of Transfer Certificate: Standard form for documenting the transfer of the loan

4. Schedule 4 - Form of Notice to Borrower: Template for notifying borrowers about the transfer of their loan

5. Schedule 5 - Seller's Power of Attorney: Form of power of attorney for Seller to execute necessary transfer documents

6. Schedule 6 - Completion Checklist: List of actions and deliverables required at completion

7. Schedule 7 - Existing Security Details: Details of any security interests associated with the loans

8. Appendix A - Relevant Loan Documentation: Copies or list of all relevant underlying loan documents

9. Appendix B - Required Regulatory Filings: Forms and documents required for regulatory compliance

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Indonesia

Publisher

Ƶ

Document Type

Sale Agreement

Cost

Free to use
Relevant legal definitions










































Clauses








































Relevant Industries

Banking

Financial Services

Investment Management

Asset Management

Debt Collection

Corporate Finance

Private Equity

Distressed Asset Management

Real Estate Finance

Commercial Lending

Investment Banking

Relevant Teams

Legal

Finance

Compliance

Risk Management

Treasury

Corporate Finance

Credit Administration

Portfolio Management

Debt Recovery

Banking Operations

Investment Management

Transaction Management

Relevant Roles

Chief Financial Officer

Head of Legal

Legal Counsel

Finance Director

Portfolio Manager

Credit Risk Manager

Compliance Officer

Investment Manager

Transaction Manager

Asset Manager

Corporate Finance Manager

Treasury Manager

Debt Recovery Manager

Banking Operations Manager

Senior Legal Counsel

Financial Controller

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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