Consolidation of sharia banks also needed
Amid talk of merging banks in the country to boost size and competitiveness in the region, the Financial Services Authority (OJK) has said that consolidation of sharia banks is also needed. At the moment, however, many sharia lenders are units that operate within conventional banks. OJK expects the consolidation to take place after all existing sharia business units (UUS) had been spun off from their parent banks. At the moment, there are 11 sharia lenders and 23 UUS operating in the country. After the spin-off, there would be more than 34, but the OJK would like to fix the number at between 25 and 30. One sharia business unit of a commercial bank is reportedly ready to be spun off in 2014.
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