Regulatory Alerts2011-12-01
Bank Indonesia Circular Letter No. 13/27/DPM on Procedures for Reverse Repo Transaction of Sovereign Sharia Securities
Bank Indonesia issued Circular Letter No. 13/27/DPM to establish procedures for conducting Sovereign Sharia Securities (SBSN) reverse repo transactions as a tool for monetary contraction. The regulation defines eligibility criteria for participating banks, including minimum funding ratios and system participation status, and mandates the use of fixed or variable rate tender auctions via the BI-SSSS system. It further details settlement obligations for both legs of the transaction and imposes financial penalties or temporary suspensions for cancellations or settlement failures.
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