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OJK releases Sharia securities list and plan
Chris Hamblin
Clearview Publishing
2 June 2014
Indonesia's
Financial Services Authority (OJK) has reviewed its investment
guideline, known as the 'Sharia securities list,' for investment
managers of Sharia mutual funds, Sharia insurance and investors
intending to invest in Sharia securities portfolios. It has also
released a guideline for Sharia index providers such as the Indonesia
Stock Exchange which issues Jakarta Islamic Index and Indonesia
Sharia Stock Index. There are 322 types
of security on the list and 584 issuers and public companies, 28 of
the companies having joined this year so far. At the same time, the
Directorate of the Sharia Capital Market is drawing up a so-called
'road map' for the market's medium-term development. The process of
consultation, which involves a kaleidoscope of focus groups, has
begun. The directorate is also overhauling its regulations,
especially Reg No IX.A.13 which governs the issuance of Sharia
securities, and will finish sometime this year. On the agenda is the
simplification of the registration statement document, new rules for
disclosures associated with sukuk, the Islamic equivalent of
bonds, new rules for sukuk trustee contracts, the completion of a
regulation to govern types of Sharia mutual funds, more choices for
Sharia mutual fund portfolios, and the completion of a regulation to
do with Sharia asset-backed securities. Islamic business
takes up almost 5% of Indonesia's banking business. The OJK says that
the country has 11 fully-fledged Islamic banks and 23 Islamic windows
operated by conventional banks. Their combined Islamic banking assets
grew by 24% to 242 trillion rupiah ($21.4 billion) last year.