Indonesia’s Islamic banking industry remained under pressure throughout 2015 after experiencing limited growth but continued to innovate to increase their market share through various creative ways.
At a time when conventional investment products in developed economies have lost appeal due to their unattractively low yields, investors around the world are turning to sukuk. For Indonesia, this is an opportune context to carve out for itself a greater share of the global market.
Contribution to GDP: 2.55% (Q3 2015)
Return on Assets: 2.31% (Q3 2015)
Number of Commercial Banks: 118; 4 State/Partially State Owned, 10 Foreign, 11 Joint Ventures, 28 Non Foreign Exchange, 39 Foreign Exchange, 26 Regional Development Banks (August 2015).
Number of Islamic Banks & Units: 12 Banks, 22 Units (2015)
Total Assets: 6,244 trillion IDR (Q3 2015)
Government Bodies: Bank Indonesia, Ministry of Finance, Financial Services Authority (OJK).
Relevant Law: Bank Indonesia Regulation No. 14/8/PBI/2012 on Share
Ownership in Commercial Banks limits ownership by a single local/foreign financial institution to 40%, by a non financial institution to 30%, and by an individual to 20%. Larger stake is possible with the approval of Bank Indonesia.