The national Islamic banking industry was rocked by the discourse of eliminating the obligation to spin off (separation) of Islamic Windows from their Conventional Bank holdings in 2023 as mandated by Law No. 21/2008 concerning Islamic Banking. The discourse on the elimination of spin-off obligations is under the Draft Law on Development and Strengthening of the Financial Sector in Article 68 paragraph (1), which maintains spin-off obligations for Islamic Windows, whose assets have reached 50 percent of their Conventional Bank. Still, it removes obligations spin-off a maximum of 15 years after the enactment of Law No. 21/2008.
In other words, the Draft Law on Development and Strengthening of the Financial Sector make spin-offs without a time limit. Therefore, becoming an Islamic Bank is no longer a requirement as long as the assets of the Islamic Windows do not reach 50 percent of its Conventional Bank. The condition is to prepare a minimum core capital of at least Three trillion Rupiah for Conventional Banks and A trillion Rupiah for Islamic Banks resulting from the spin-off, amid the impact of the pandemic that has not yet passed, is the main reason for the unpreparedness of the spin-off even though Law No. 21/2008 has given a deadline of up to 15 years.