New Provisions on Conversion of BUK to BUS: Arrangements on Operational Transitional Period Introduced

The Financial Services Authority (Otoritas Jasa Keuangan – “OJK”) has introduced an updated legal framework that addresses the conversion of the activities of conventional commercial banks (bank umum konvensional – “BUK”) to those of sharia commercial banks (bank umum syariah – “BUS”) through the issuance of Circular No. 6/SEOJK.03/2023 (“Circular 6/2023”), which has been in force since 21 February 2023. Previously, these matters were dealt with under Circular of the OJK No. 2/SEOJK.03/2017 (“Circular 2/2017”), which bore the same title and has now been repealed and replaced.