Under new regulations, Indonesia's Financial Services Authority would permit the Ministry of Finance, the central bank, and the sovereign wealth fund Danantara to hold shares in the Indonesia Stock Exchange once it completes its demutualization process. Direct or indirect shareholdings by these parties could reach up to 5% without requiring prior regulatory approval.

Any stake exceeding 5% would require authorization from the Financial Services Authority, and investors seeking a higher ownership level must demonstrate their ability to add value to the development of the exchange. No shareholder, whether through direct, indirect, or affiliated means, may hold more than 50% of the Indonesia Stock Exchange's equity.

The Ministry of Finance, Bank Indonesia, and Danantara can hold shares, provided that the exchange's independence is maintained, and these institutions may also appoint other entities to hold shares on their behalf. In a statement on Monday, Hasan Fawzi, the head of capital market regulation at Indonesia's Financial Services Authority, said: "Following the exchange's demutualization, exchange members, strategic investors, and the public can all own stakes. This reform will drive governance improvements, broaden access to capital, and accelerate the exchange's growth."

The demutualization can be carried out through the issuance of new shares and/or the sale of treasury stock. The regulation took effect on September 17.