OJK gives banks leeway to meet 15 percent free float

Otoritas Jasa Keuangan is giving banks and shareholders room to choose how to meet the minimum public shareholding, or free float, requirement of 15 persen. OJK said the mechanism can be adjusted to each bank’s conditions as long as it still complies with the rules and does not disrupt health or operational continuity. Chief Executive of Banking Supervision Dian Ediana Rae said meeting the free float requirement must move in step with efforts to strengthen capital and expand business plans. He said issuing new shares could be one option because it can add capital and broaden public ownership at the same time. Another option is a merger of two or more banks so ownership structure can be adjusted. If the two conflict, OJK will assess risk profile, capital needs and the bank’s business plan, with priority given to capital adequacy and bank health.