BLS LEGAL NEWS AND VIEWS II: “KAJIAN HUKUM MEKANISME BAIL-IN DALAM RESOLUSI BANK DI INDONESIA: PERLINDUNGAN KREDITUR, KEWENANGAN OTORITAS, DAN STUDI KOMPARASI KANADA”

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BLS LEGAL NEWS AND VIEWS II: "KAJIAN HUKUM MEKANISME BAIL-IN DALAM RESOLUSI BANK DI INDONESIA: PERLINDUNGAN KREDITUR, KEWENANGAN OTORITAS, DAN STUDI KOMPARASI KANADA"

Greetings, Business Law Enthusiasts!

Banking and Finance Division BLS FH UI 2026 proudly presents:

BLS Legal News and Views II:

"Kajian Hukum Mekanisme Bail-In dalam Resolusi Bank di Indonesia: Perlindungan Kreditur, Kewenangan Otoritas, dan Studi Komparasi Kanada"

Through the PPSK Law and its implementing regulations, Indonesia has laid the legal foundation for bail-in as a bank resolution mechanism, whereby a failing bank's liabilities may be converted into equity so that losses are borne by shareholders and creditors rather than by the State Budget (APBN). The Indonesia Deposit Insurance Corporation (LPS) is granted broad authority to carry out resolution measures without the prior consent of shareholders or creditors. Nevertheless, a comprehensive and explicit bail-in framework has yet to be established: the limits of this authority, the trigger points for its activation, and the protection of creditors' rights, particularly under the No Creditor Worse Off (NCWO) principle, remain insufficiently regulated.

In this edition of BLS Legal News and Views, we unpack these legal gaps across the PPSK Law, POJK 5/2024, and PLPS 5/2024, from OJK's discretion in designating a Bank in Resolution and LPS's broad authority in executing it, to the absence of hard triggers and standardized independent valuation. We then compared Indonesia’s current status to Canada to see how legally binding triggers, layered business valuations, and NCWO-based compensation can protect creditors while keeping the financial system stable, and what Indonesia can take from it.

Written by: Alya Aziza Ananda, Muhamad Ihsan, Naila Firas Raida as Staff of Banking and Finance Division BLS FH UI 2026 and Kesya Anandita Fadilla as Staff of Alumni and Public Relations Division BLS FH UI 2026

Edited by: Mollynda Ara Safia, S.H.

Click the link below: blsfhui.com/LNV2BAFIN2026

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