Indonesia Witnesses Significant Bank Failures in 2024-2025

Regulatory Crackdown on Rural Banks

The Financial Services Authority (OJK) has revoked the licenses of five additional banks in 2025, bringing the total number of bank failures since 2024 to 25. The latest bank to be closed was PT Bank Perekonomian Rakyat Artha Kramat, located in Tegal, Central Java, which was shut down through a self-liquidation process initiated by its shareholders. This decision was formalized through the OJK's Decision Letter Number KEP-71/D.03/2025 dated October 14, 2025.

Reasons Behind Bank Failures

The closure of BPR Artha Kramat was justified by the need for shareholders to focus on developing another bank within the same ownership group, PT Bank Perekonomian Rakyat Bumi Sediaguna. This reason highlights the OJK's approach to managing bank failures by consolidating resources within related banking groups. The decision reflects a broader trend of regulatory scrutiny focusing on capital adequacy and liquidity management among rural banks.

Pattern of Bank Closures in 2025

The OJK has been actively monitoring and regulating the banking sector, with four other BPRs having their licenses revoked earlier in 2025:

1. April 2025: BPRS Gebu Prima in Medan, North Sumatra
2. July 2025: BPR Dwicahaya Nusaperkasa in Batu, East Java
3. August 2025: BPR Disky Surya Jaya in Deli Serdang, North Sumatra - closed due to failure to meet capital and liquidity requirements
4. September 2025: BPRS Gayo Perseroda - failed to improve capital adequacy and liquidity ratios

Regulatory Implications

The OJK's actions demonstrate a commitment to maintaining financial stability through stricter enforcement of banking regulations. The focus on rural banks reflects their vulnerability to economic fluctuations and the need for robust regulatory oversight. As the banking landscape continues to evolve, stakeholders will be watching closely for further regulatory developments that could impact both consumer confidence and banking sector stability.