Internal Liquidity Adequacy Assessment Procedures Clarified: Commercial Banks Required to Begin One-Year Trial Reporting Ahead of December 2026 Initial Submissions

As the most recent amendment to Regulation of the Financial Services Authority (Otoritas Jasa Keuangan – “OJK”) No. 42/POJK.03/2015, Regulation of the OJK No. 19 of 2024 (collectively referred to as “Regulation 42/2015”) requires Conventional Commercial Banks (Bank Umum Konvensional – “BUK”) to implement the Internal Liquidity Adequacy Assessment Process (“ILAAP”) in order to assess the adequacy of their liquidity under various market conditions and stress scenarios, as may be faced by BUK.[1] Similarly, Regulation of the OJK No. 20 of 2025 (“Regulation 20/2025”) also requires Sharia Commercial Banks (Bank Umum Syariah – “BUS”) and Sharia Business Units of BUK (Unit Usaha Syariah – “UUS”) to engage in the ILAAP process.[2]