Sharia reverse repo offered to absorb liquidity
Bank Indonesia (BI) stated that it is offering reverse repo for sharia banks and business units to decrease bank liquidity in the financial system.
Reverse repo transactions ask banks to buy at least Rp 1 billion (US$110,000) of government sukuk from the central bank and receive margins when they buy back at an agreed price after a specified time period. This has the purpose to absorbe the liquidity of sharia banks, especially of banks with finance-to-deposit ratios of at least 80% and those that participate in BI’s sharia monetary operation.
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