Regulation on Banking Consolidation and Strengthening

The Financial Services Authority (“OJK”) is currently preparing a policy and formal mechanism to strengthen capital and encourage the consolidation of banks categorized as Commercial Banks Based on Core Capital (“KBMI”). Dian Ediana Rae, Chief Executive of Banking Supervision at OJK, stated that the capital strengthening process must be carried out in a prudent and sustainable manner.

“An inorganic approach through consolidation is necessary to encourage the performance of banks considered to have stagnated. This of course requires honesty and a visionary attitude from the Controlling Shareholders (PSP) and bank management in assessing their future business prospects based on their current capital position and performance,” Dian explained to Hukumonline.

OJK had previously issued an official appeal regarding Fundamental Strengthening and Consolidation to all banks categorized as KBMI 1 since the end of October 2025. OJK also urged each KBMI 1 bank to conduct a comprehensive and continuous evaluation.

“It is still in progress, including the preparation of a banking strengthening roadmap,” she added.