OJK Tightens Capital Requirements for Sharia Commercial Banks

The Financial Services Authority (“OJK”) is finalizing the Draft Regulation of OJK (“RPOJK”) on Minimum Capital Adequacy Requirements (“KPMM”) for Sharia Commercial Banks (“BUS”). These refinements to BUS capital regulations are being implemented by adopting global frameworks such as Basel III and the Islamic Financial Services Board (“IFSB-23”) standards.

“Strengthening capital is not merely about meeting requirements, but serves as the primary foundation for sharia banks to absorb risks and maintain sustainable growth amid global dynamics,” said Dian Ediana Rae, Executive Director of Banking Supervision at OJK.

This RPOJK also expands the scope of the Internal Capital Adequacy Assessment Process (“ICAAP”) by incorporating active oversight by the Sharia Supervisory Board (“DPS”). This underscores the integration of risk management and adherence to Sharia principles within the bank’s capital structure.