PT BFI Finance Indonesia Tbk : Beyond the New Normal

COVER STORY

The curious phenomenon of sunlight, upon travelling through a glass prism, turning into a multitude of colors had been observed long before someone, dabbling with simple optical tools and time on his hands, decided to find out why that was so.

The period was the 1660s, around the time the Great Plague swept over London, killing nearly a quarter of its inhabitants. That someone was the renowned mathematician and physicist, Sir Isaac Newton. Isolating at his family cottage in a hamlet 150 km north of London, with a set of transparent prisms, a keen pair of eyes, and a mind thirsting for knowledge and novelty, Newton set out to investigate the nature of light and human sight, and what was there to be revealed between the two.

How is it really that a blade of white light striking an inert piece of glass can conjure such neat, vibrant gradations-something as animated and enchanting as the rainbow? Newton rummaged his mind for possible explanations, and after eliminating those which did not agree with his observations, came up with one final answer. Through his homespun experiments, he concluded that white light was not a pure entity, as many ahead of his time had suggested, but rather a bundle of hues. As it enters the prism, the light is "refracted"-broken up into its foundational constituents: the colors that our eyes see.

In the sciences and humanities, progress is often made incrementally, perfected over long periods of time by piecemeal discoveries of those dedicating their lives to the cause. At times, however, the field advances in leaps and bounds, revolutionized by a landmark finding, or an act of audacious imagining. Newton's theory of light and colors is of the latter, revolutionary kind. Once this was known to us, the way we perceived the world changed-for good. With this paradigm shift, a new era unfolded.

Global catastrophes like a pandemic often force us to learn, the hard way, to reimagine the ways we do things. They necessitate us, against our natural aversion to the uncertain, to look at it in the face. But beyond that, they also spur us to switch our perspective, to consider what we have never done before. And as our perspective switches, our vision of the landscape becomes enriched.

A change in perspective changes the mindset. It allows us to realize that there is not one single way of doing things. There are myriad. Some of the new ways initially introduced as ad-hoc solutions

DISCLAIMER

would prove their worth in the long term. These ones would eventually stay, becoming the norm, rendering the old ones obsolete.

Today, three years into the Covid-19 pandemic, the world has mounted a mighty response to deal with the virus's direct damage and its repercussions. We have hastened research and come up with effective vaccines and rolled them out in record time. Being physically constricted, we have embraced technology to remain connected with each other, and to maintain our quality of life pre-pandemic. Government agencies and businesses have radically transformed the ways they serve the public and their customers. Some have even performed far better than before and flourished in the digital lane, never looking back. Instead, they train their sight forward, excited for what is to come.

Such is the power and beauty of shifting our perspective. A stumbling block may turn out to be a stepping stone. It reveals to us a spectrum of possible solutions. And with it, we can peer into what lies beyond the horizons.

PT BFI Finance Indonesia Tbk (BFI Finance or the Company) has ensured the accuracy of the information contained in this Integrated Annual Report. However, the Company does not guarantee the appropriateness, accuracy, usefulness or any other matter regarding this information. This Integrated Annual Report contains some forward-looking statements about the Company's future expectations, plans, and strategies that are not historical facts. They are based on current expectations, estimates, forecasts, and projections about the business and environment in which the Company operates and beliefs and assumptions made by management. As these expectations, estimates, forecasts, and projections are subject to a number of risks, uncertainties, and assumptions, actual results may differ materially from those projected. The Company, therefore, cautions readers not to place undue reliance on forward-looking statements. The Company undertakes no obligation to update any forward-looking statements as a result of new information, future events or other developments. Any reliance placed on the Integrated Annual Report and Financial Statements is done entirely at the risk of the person placing such reliance. Additionally, numbers represented throughout this Integrated Annual Report have been rounded up to the closest million or billion rupiah, and as such, there may be discrepancies in percentage change calculations compared to when calculated using full figures from the Annual Financial Statements.

Cover Story

ABOUT THIS REPORT

Beyond the New Normal Theme Continuity

Introduction to Integrated Reporting Summary of Integrated Annual Report 2021 Summary of 2021 Sustainable Performance 2021 Key Highlights

01. 2021 PERFORMANCE HIGHLIGHTS

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Key Financial Highlights 18

Share Highlights 20

• Corporate Action 21

• Suspension and/or Delisting 21

• Structure of Shareholders 22

• Dividend Payment History 22

Bonds Highlights 23

Important Events in 2021 24

Awards and Recognition 26

02. REPORTS TO STAKEHOLDERS

Report of the Board of Commissioners Report of the Board of Directors Responsibility of Integrated Annual Report

• • Statement of the Board of Commissioners on the Responsibility for the 2021 Integrated Annual Report of

  PT BFI Finance Indonesia Tbk

• • Statement of the Board of Directors on the Responsibility for the 2021 Integrated Annual Report of PT BFI Finance Indonesia Tbk

03. COMPANY PROFILE

General Company Information Company Vision and Mission Sustainability Vision and MissionBrief Company History Milestones

Core Values and Corporate Culture Corporate Identity

Line of Business

Map and Operational Network Organization Structure Workforce Profile

Board of Commissioners Profiles Board of Directors Profiles Sharia Supervisory Board Profiles

Committees of the Board of Commissioners Profiles

• • Audit Committee

• • Risk Oversight Committee

• • Nomination and Remuneration Committee

Senior Management Profiles

Corporate Structure

Subsidiaries and Associated Entities Share Ownership Composition Majority Shareholder Profile

30 36

Chronological Listing of Shares and Changes in Number of Shares

Chronological Listing of Other Securities Public Accountant Services

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Capital Market Supporting Institutions and Professions

04. BUSINESS SUPPORTING UNITS

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Information Technology

Network and Operational Development Customer Service

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05. MANAGEMENT DISCUSSION

AND ANALYSIS

Economic and Industry Overview

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2021 Integrated Annual Report

Business Review Marketing

Financial Performance Review

• • Consolidated Statement of Financial Position

• • Consolidated Statement of Income and Other Comprehensive Income

• • Consolidated Statement of Cash Flows

Analysis of Key Ratios

Comparison of Achievements Against Targets in 2021

Capital Structure (Capital Adequacy)

Material Capital Expenditures Subsequent Events Dividends

Use of Public Offering Proceeds

Material Investment, Divestment, Merger & Acquisition, and Debt or Capital Restructuring

Transactions with Potential Conflicts of Interest and Related Parties

Impact from Regulatory Changes on the Company

Accounting Policy Changes 2022 Business Prospects

06. GOOD CORPORATE GOVERNANCE

Good Corporate Governance Report Sustainability Governance

General Meeting of Shareholders Board of Commissioners

Board of Directors

Performance Assessment of the Board of Commissioners and Board of Directors

Meetings of the Board of Commissioners, Board of Directors, and Joint Meetings of the Board of Commissioners and Board of Directors

Sharia Supervisory Board Audit Committee

Risk Oversight Committee

Nomination and Remuneration Committee Corporate Secretary

Internal Audit

Internal Control System Risk Management Legal Cases

110 119 122 122 140 147 149 152

Administrative Sanctions

Access to Information and Communication Investor Relations

Compliance

• • Anti-Money Laundering and Combating the Financing of Terrorism (AML-CFT)

Code of Conduct and Corporate Culture Stock Options

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Information Disclosure Policy Whistleblowing System Anti-Corruption Policy Procurement Policy

Transparency of Financial and Non-Financial Conditions Not Disclosed in Other Reports

155 156 156 156 157 159

Statement of Application of the Guidelines for Public Corporate Governance

07. SUSTAINABILITY

Sustainability Strategy Human Capital Environmental Performance Social Performance

Responsibility for Sustainable Product/Service Development

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08. SUPPORTING DATA

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250 254 262 264 270

Addresses of Outlets 274

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Glossary 294

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09. ANNUAL FINANCIAL STATEMENTS

Consolidated Financial Statements for the Year Ended 31 December 2021 and Independent Auditors' Report

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APPENDICES

200 204 209

Summary of Sustainable Finance Action Plan (RAKB) Report

Feedback Form

212 216 218

Cross Reference OJK Circular No. 16/ SEOJK.04/2021 on Form and Content of Annual Reports of Issuers or Public Companies

222 224 229

Cross Reference OJK Regulation No. 51/POJK.03/2017 - Implementation of Sustainable Finance for Financial Services Institutions, Issuers, and Public Companies

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