PT Bank Tabungan Negara (Persero) Tbk plans to spin off its Islamic business unit in 2020, IDNFinancials reported Oct. 15.
The bank decided to delay the spin-off as the sharia unit will be more profitable if it is not separate, said Mahelan Prabantarikso, the bank's strategy, compliance and risk director. The bank will spin off its sharia unit in 2020, he added.
The bank has until 2023 to spin off its sharia business as per central bank regulations. According to Bank Indonesia, the separation of the sharia business unit from the parent commercial bank must be carried out no later than 15 years after the enactment of the 2008 law concerning Islamic banking.