OJK Regulation No. 20 of 2025 on Liquidity Coverage Ratio and Net Stable Funding Ratio Requirements for Islamic Commercial Banks and Islamic Business Units

COPY
FINANCIAL SERVICES AUTHORITY REGULATION
OF THE REPUBLIC OF INDONESIA
NUMBER 20 OF 2025
CONCERNING
THE OBLIGATION TO FULFILL THE
LIQUIDITY COVERAGE RATIO AND
NET STABLE FUNDING RATIO
FOR ISLAMIC COMMERCIAL BANKS AND ISLAMIC BUSINESS UNITS BY THE GRACE OF THE MOST HIGH GOD THE COMMISSIONERS OF THE FINANCIAL SERVICES AUTHORITY,

Considering:
a. that in order to create a healthy, developing, and globally competitive Islamic banking system, as well as in line with the development of international standards, banks need to have strong and adequate liquidity; b. that to assess liquidity adequacy, a liquidity ratio that is equivalent, reliable, and comparable is needed to assess the adequacy of the quantity of high-quality financial assets to anticipate net cash outflows and the adequacy of stable funding based on the composition of assets and administrative account transactions for Islamic commercial banks and Islamic business units;
c. that based on the considerations as referred to in letters a and b, it is necessary to establish a Financial Services Authority Regulation on the Obligation to Fulfill the Liquidity Coverage Ratio and Net Stable Funding Ratio for Islamic Commercial Banks and Islamic Business Units;

Recalling:

1. Law Number 21 of 2008 concerning Islamic Banking (State Gazette of the Republic of Indonesia Year 2008 Number 94, Supplement to the State Gazette of the Republic of Indonesia Number 4867) as amended several times, lastly with Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (State Gazette of the Republic of Indonesia Year 2023 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6845);
2. Law Number 21 of 2011 concerning the Financial Services Authority (State Gazette of the Republic of Indonesia Year 2011 Number 111, Supplement to the State Gazette of the Republic of Indonesia Number 5253) as amended with Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (State Gazette of the Republic of Indonesia Year 2023 Number 4, Supplement to the State Gazette of the Republic of Indonesia Number 6845);

DECIDING:
To establish:
FINANCIAL SERVICES AUTHORITY REGULATION ON THE OBLIGATION TO FULFILL THE LIQUIDITY COVERAGE RATIO AND NET STABLE FUNDING RATIO FOR ISLAMIC COMMERCIAL BANKS AND ISLAMIC BUSINESS UNITS.

CHAPTER I
GENERAL PROVISIONS

Article 1
In this Financial Services Authority Regulation, the following terms are meant:

1. Bank means Islamic commercial banks and Islamic business units.
2. Islamic Commercial Bank, hereinafter abbreviated as BUS, is a Bank that conducts business activities based on Sharia principles, which in its activities provide services in the payment circuit.
3. Islamic Business Unit, hereinafter abbreviated as UUS, is a working unit of the head office of a conventional commercial bank that functions as the head office of offices or units that conduct business activities based on Sharia principles, or a working unit in the branch office of a bank located abroad that conducts conventional business activities and functions as the head office of Sharia branch offices and/or Sharia units.
4. Sharia Principle is an Islamic legal principle based on fatwas and/or Sharia conformity statements issued by institutions that have authority in determining fatwas in the Sharia field.
5. High Quality Liquid Asset, hereinafter abbreviated as HQLA, is cash and/or financial assets that can be easily converted into cash with little or no value reduction to meet the Bank's liquidity needs during a 30 (thirty) day period in a stress scenario.
6. Net Cash Outflow is the total estimated cash outflows minus the total estimated cash inflows that are expected to occur during a 30 (thirty) day period in a stress scenario.
7. Liquidity Coverage Ratio, hereinafter abbreviated as LCR, is the ratio between HQLA and Net Cash Outflow during a 30 (thirty) day period in a stress scenario.
8. Deposit is funds entrusted by customers to the Bank based on contracts that do not contradict Sharia Principles in the form of current accounts, savings, time deposits, deposit certificates, or other forms that are equivalent to them.
9. Investment is funds entrusted by customers to the Bank based on mudarabah contracts or other contracts that do not contradict Sharia Principles, the risks of which are borne by investor customers.
10. Funding is the receipt of funds from third parties that creates obligations for the Bank in the form of Deposits, Investments, sukuk, issued Sharia securities, received financing, and other forms of obligations that are equivalent to them.
11. Internal Liquidity Adequacy Assessment Process, hereinafter abbreviated as ILAAP, is a process conducted by the Bank to calculate liquidity adequacy in various scenarios of market conditions and stress periods that the Bank may face.
12. Available Stable Funding, hereinafter abbreviated as ASF, is the amount of stable liabilities and equity for one (1) year to fund the Bank's activities.
13. Required Stable Funding, hereinafter abbreviated as RSF, is the amount of assets and administrative account transactions that need to be funded by stable funding.
14. Net Stable Funding Ratio, hereinafter abbreviated as NSFR, is the ratio between ASF and RSF.
15. NSFR Report is a report that presents quantitative information in the form of NSFR calculations and values, as well as qualitative information in the form of NSFR development analysis.
16. NSFR Working Paper is a report containing detailed NSFR calculations as data sources in compiling the NSFR Report.
17. NSFR Fulfillment Action Plan, hereinafter referred to as the Action Plan, is a report that contains at least improvement plans for NSFR adequacy fulfillment accompanied by completion timeframes.

CHAPTER II
MAINTENANCE OF LIQUIDITY AND STABLE FUNDING ADEQUACY

Article 2
(1) Banks are obligated to maintain adequate liquidity.
(2) Banks are obligated to maintain adequate stable funding.
(3) The fulfillment of liquidity adequacy as referred to in paragraph (1) is calculated using the LCR.
(4) The fulfillment of stable funding as referred to in paragraph (2) is calculated using the NSFR.
(5) The LCR calculation as referred to in paragraph (3) and the NSFR calculation as referred to in paragraph (4) are calculated in Rupiah denomination.
(6) The LCR fulfillment as referred to in paragraph (3) is set at a minimum of 100% (one hundred percent) continuously.
(7) The NSFR fulfillment as referred to in paragraph (4) is set at a minimum of 100% (one hundred percent).
(8) Based on certain considerations, the Financial Services Authority may set an LCR different from the LCR as referred to in paragraph (6).
(9) Based on certain considerations, the Financial Services Authority may set an NSFR different from the NSFR as referred to in paragraph (7).

Article 3
In the event that a BUS has and/or exercises control over subsidiaries, the obligation to fulfill the LCR as referred to in Article 2 paragraph (6) and the obligation to fulfill the NSFR as referred to in Article 2 paragraph (7) apply to the BUS individually and on a consolidated basis.

Article 4
Banks that violate the provisions as referred to in Article 2 paragraph (1) and/or paragraph (2) are subject to administrative sanctions in the form of:
a. written reprimand; b. suspension of dividend distribution on all share ownership from shareholders who make capital contributions;
c. suspension of certain business activities;
d. prohibition on opening office networks; e. downgrade of the Bank's health level; and/or f. prohibition as a principal party for the Bank's principal parties in accordance with the Financial Services Authority Regulation concerning the re-evaluation of principal parties of financial service institutions.

CHAPTER III
LIQUIDITY COVERAGE RATIO
First Section
High Quality Liquid Asset

Article 5
(1) Banks are obligated to have HQLA to fulfill the LCR as referred to in Article 2 paragraph (6).
(2) Banks are obligated to have policies regarding HQLA at least for:
a. identifying legal entities, geographical locations, currency types, and/or HQLA account locations; and b. excluding certain assets from HQLA based on operational reasons.
(3) The value of HQLA considered in the LCR calculation is the market value of the HQLA.

Article 6
(1) HQLA considered in LCR fulfillment as referred to in Article 5 paragraph (1) consists of components:
a. HQLA Level 1; and b. HQLA Level 2 which includes:

1. HQLA Level 2A; and
2. HQLA Level 2B.
   (2) HQLA Level 1 as referred to in paragraph (1) letter a that can be considered in LCR fulfillment is not limited in quantity.
   (3) HQLA Level 2 as referred to in paragraph (1) letter b that can be considered in LCR fulfillment is at most 40% (forty percent) of total HQLA.
   (4) HQLA Level 2B as referred to in paragraph (1) letter b number 2 that can be considered in LCR fulfillment is at most 15% (fifteen percent) of total HQLA.
   (5) The calculation of the maximum limit of HQLA Level 2 as referred to in paragraph (3) and HQLA Level 2B as referred to in paragraph (4) uses the formula as contained in Appendix I which is an integral part of this Financial Services Authority Regulation.

Article 7
(1) HQLA as referred to in Article 5 paragraph (1) must meet requirements:
a. fundamental; b. related to market characteristics;
c. operational; and
d. diversified.
(2) In the event that assets included in the HQLA category no longer meet the requirements as referred to in paragraph (1), the Bank must adjust the amount of HQLA or replace assets with other assets that meet HQLA criteria within a maximum period of 30 (thirty) days counted from the date the HQLA requirements are not met. (3) The HQLA requirements as referred to in paragraph (1) are contained in Appendix I which is an integral part of this Financial Services Authority Regulation. (4) In addition to meeting the requirements as referred to in paragraph (1), HQLA Level 1, Level 2A, and Level 2B components must also meet requirements as contained in Appendix I which is an integral part of this Financial Services Authority Regulation.

Second Section
Cash Outflow and Cash Inflow

Article 8
(1) For LCR fulfillment as referred to in Article 2 paragraph (6), Banks are obligated to calculate cash outflows during the next 30 (thirty) days.
(2) Cash outflows as referred to in paragraph (1) originate from:
a. Retail deposits and investments; b. Funding from micro and small business customers;
c. Funding from corporate customers;
d. Secured funding; and e. Additional cash outflows.
(3) The value of cash outflows considered in LCR fulfillment is the outstanding liability value on the financial position report and administrative account commitments multiplied by the run-off rate. (4) Provisions regarding the sources of cash outflows as referred to in paragraph (2), as well as the run-off rate and cash outflow calculations as referred to in paragraph (3) are contained in Appendix I which is an integral part of this Financial Services Authority Regulation.

Article 9
(1) In LCR fulfillment as referred to in Article 2 paragraph (6), Banks are obligated to calculate cash inflows during the next 30 (thirty) days.
(2) Cash inflows as referred to in paragraph (1) originate from:
a. Secured financing; b. Counterparty receivables; and/or
c. Other cash inflows.
(3) Banks are prohibited from calculating committed facility financing facilities and liquidity facilities as sources of cash inflows.
(4) The value of cash inflows that can be considered in LCR is at most 75% (seventy-five percent) of total cash outflows as referred to in Article 8.
(5) The value of cash inflows that can be considered in LCR fulfillment is the contractual receivable value multiplied by the inflow rate.
(6) Provisions regarding the sources of cash inflows as referred to in paragraph (2), as well as the inflow rate and the calculation of cash inflow values that can be considered as referred to in paragraph (5) are contained in Appendix I which is an integral part of this Financial Services Authority Regulation.

Third Section
Liquidity Monitoring

Article 10
(1) In addition to the obligation to calculate LCR as referred to in Article 2 paragraph (6), Banks are obligated to monitor liquidity conditions and adequacy using specific indicators. (2) In addition to liquidity monitoring as referred to in paragraph (1), Banks are obligated to conduct ILAAP adjusted to the size, characteristics, and complexity of the Bank's business. (3) The method of compiling and submitting ILAAP as referred to in paragraph (2) is determined by the Financial Services Authority.

Fourth Section
LCR Calculation, Reporting, and Publication

Article 11
Banks are obligated to conduct:
a. daily LCR calculations; b. monthly LCR calculations and reporting; and
c. quarterly LCR calculations and publications,
individually and on a consolidated basis.

Article 12
(1) The obligation for daily LCR calculations as referred to in Article 11 letter a is first conducted for the position dated June 1, 2026.
(2) The results of daily LCR calculations become the basis for LCR calculations in monthly and quarterly reporting.
(3) If necessary, the Financial Services Authority may request Banks to submit daily LCR calculation reports.
(4) Provisions regarding daily LCR calculations as referred to in paragraph (1) are contained in Appendix I which is an integral part of this Financial Services Authority Regulation.

Article 13
(1) The obligation for monthly LCR calculations and reporting as referred to in Article 11 letter b is first conducted for the report position dated January 31, 2026.
(2) Monthly LCR calculations and reporting as referred to in Article 11 letter b are conducted based on daily average reports.
(3) Before the implementation of the daily LCR calculation obligation as referred to in Article 12 paragraph (1), Banks may calculate monthly LCR values based on the end-of-month position of the reporting month.

Article 14
(1) Banks are obligated to submit monthly LCR reports as referred to in Article 11 letter b online through the Financial Services Authority's reporting system.
(2) The procedures, formats, and timeframes for submitting monthly LCR reports are implemented in accordance with the Financial Services Authority Regulation concerning bank reporting through the Financial Services Authority's reporting system. (3) In the event that the Financial Services Authority's reporting system as referred to in paragraph (1) is not yet available, Banks are obligated to submit monthly LCR reports offline. (4) Submission of monthly LCR reports as referred to in paragraph (1) and paragraph (3) is conducted at the latest:
a. 15 (fifteen) days after the end of the reporting month, for individual monthly LCR reports; and b. 30 (thirty) days after the end of the reporting month, for consolidated monthly LCR reports. (5) Submission of monthly LCR reports as referred to in paragraph (3) and paragraph (4) is submitted to:
a. The Sharia Banking Department or the Financial Services Authority Office in Jakarta, for Banks headquartered in the Special Capital Region of Jakarta Province; or b. The local Financial Services Authority Office, for Banks headquartered outside the Special Capital Region of Jakarta Province. (6) In the event that the submission deadline as referred to in paragraph (5) falls on a Saturday, Sunday, and/or holiday, the report is submitted on the next working day.

Article 15
Banks are obligated to calculate quarterly LCR reports as referred to in Article 11 letter b based on daily average reports.

Article 16
(1) The obligation to publish quarterly LCR calculations as referred to in Article 11 letter a is first conducted for the report position of September 2026.
(2) Banks are obligated to publish quarterly LCR calculations and/or values as referred to in paragraph (1) for the positions of March, June, September, and December.
(3) Publication of quarterly LCR calculations and/or values as referred to in paragraph (2) is conducted at the latest:
a. on the 15th of the second month after the end of the reporting month, for end-of-month positions of March, June, and September; and b. on the last day of March of the following year after the end of the reporting month, for end-of-month positions of December. (4) The procedures, formats, and timeframes for publishing quarterly LCR calculations are implemented in accordance with the Financial Services Authority Regulation concerning transparency and publication of bank reports. (5) A Bank is deemed not to have published quarterly LCR as referred to in paragraph (1) if the announced quarterly publication report does not include information regarding the quarterly LCR percentage value.

Fifth Section
LCR Fulfillment Stages

Article 17
(1) LCR fulfillment as referred to in Article 2 paragraph (6) is conducted in stages.
(2) The LCR fulfillment stages as referred to in paragraph (1) are implemented with the following provisions:
a. at least 80% (eighty percent) since June 30, 2026; b. at least 90% (ninety percent) since June 30, 2027; and
c. at least 100% (one hundred percent) since June 30, 2028.
(3) Banks are obligated to fulfill LCR according to the stages as referred to in paragraph (2).

Article 18
(1) In the event that a Bank is unable and/or potentially unable to fulfill LCR according to the stages as referred to in Article 17 paragraph (2), the Bank is obligated to:
a. report to the Financial Services Authority; and b. take necessary steps.
(2) Submission of reports as referred to in paragraph (1) letter a is conducted online through the Financial Services Authority's reporting system.
(3) In the event that the Financial Services Authority's reporting system for reports as referred to in paragraph (1) letter a is not yet available, the Bank is obligated to submit reports offline. (4) Offline submission as referred to in paragraph (3) is submitted to:
a. The Sharia Banking Department or the Financial Services Authority Office in Jakarta, for Banks headquartered in the Special Capital Region of Jakarta Province; or b. The local Financial Services Authority Office, for Banks headquartered outside the Special Capital Region of Jakarta Province. (5) The procedures, formats, and timeframes for reports as referred to in paragraph (1) letter a are implemented in accordance with the Financial Services Authority Regulation concerning bank reporting through the Financial Services Authority's reporting system. (6) Necessary steps as referred to in paragraph (1) letter b include:
a. analyzing the Bank's liquidity conditions, including:

1. reasons or factors that potentially or cause the Bank's failure to meet LCR requirements according to the stages as referred to in Article 17 paragraph (2);
2. steps that have been and will be taken to improve liquidity conditions; and
3. the estimated liquidity stress period by the Bank;
   b. submitting a report on the analysis of the Bank's liquidity conditions as referred to in letter a and further information related to the Bank's liquidity conditions to the Financial Services Authority; and
   c. implementing improvement steps.
   (8) In the event that the Bank's liquidity conditions as referred to in paragraph (1) potentially disrupt business continuity, the Bank may use HQLA that causes the Bank's LCR to be less than 100% (one hundred percent) with the approval of the Financial Services Authority.

Article 19
(1) Banks that violate the provisions as referred to in Article 5 paragraph (1), paragraph (2), Article 8 paragraph (1), Article 9 paragraph (1), paragraph (3), Article 10 paragraph (1), paragraph (2), Article 11 letter a, Article 14 paragraph (3), Article 15, Article 17 paragraph (3), Article 18 paragraph (1) letter b, and/or paragraph (3) are subject to administrative sanctions in the form of:
a. written reprimand; b. suspension of dividend distribution on all share ownership from shareholders who make capital contributions;
c. suspension of certain business activities;
d. prohibition on opening office networks; e. downgrade of the Bank's health level; and/or f. prohibition as a principal party for the Bank's principal parties in accordance with the Financial Services Authority Regulation concerning the re-evaluation of principal parties of financial service institutions. (2) Banks that violate the provisions as referred to in Article 11 letter b, Article 14 paragraph (1), and/or Article 18 paragraph (1) letter a are subject to administrative sanctions in accordance with the Financial Services Authority Regulation concerning bank reporting through the Financial Services Authority's reporting system. (3) Banks that violate the provisions as referred to in Article 11 letter c and/or Article 16 paragraph (2) are subject to administrative sanctions in accordance with the Financial Services Authority Regulation concerning transparency and publication of bank reports.

CHAPTER IV
NET STABLE FUNDING RATIO
First Section
Available Stable Funding and Required Stable Funding

Article 20
(1) For NSFR fulfillment as referred to in Article 2 paragraph (7), Banks are obligated to calculate ASF and RSF.
(2) The ASF value considered in the NSFR calculation is the sum of the results of multiplying all carrying values of liabilities and equity on the financial position report with the ASF factor. (3) The RSF value considered in the NSFR calculation is the sum of the results of multiplying all carrying values of assets on the financial position report and all administrative account transaction values on the commitment and contingency report with the RSF factor. (4) Provisions regarding the calculation of ASF values as referred to in paragraph (2) and RSF as referred to in paragraph (3) are contained in Appendix II which is an integral part of this Financial Services Authority Regulation.

Second Section
Monitoring, Reporting, and Publication of Net Stable Funding Ratio

Article 21
Banks are obligated to:
a. monitor NSFR fulfillment; b. submit NSFR calculation reports; and
c. publish the NSFR Report,
individually and on a consolidated basis.

Article 22
(1) Banks are obligated to monitor NSFR fulfillment monthly.
(2) The obligation to monitor NSFR fulfillment as referred to in paragraph (1) is first conducted for the report position dated January 31, 2026.
(3)

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