Governance Issues: LPS to Handle 7 Troubled Rural Banks in 2026

The Chairman of the Board of Commissioners of the Indonesia Deposit Insurance Corporation (LPS), Anggito Abimanyu, confirmed the resilience of Indonesia’s financial sector amid the uncertainties of 2026. LPS, together with the Financial System Stability Committee (KSSK), continues to push mitigation efforts and navigate to maintain the stability of the Indonesian financial system. In 2026, LPS is handling seven People’s Credit Banks (BPR) whose business licences were revoked due to integrity and management governance issues. However, the banking ecosystem remains stable with sufficiently strong capital, good banking intermediation, and double-digit growth in third-party funds and credit. Anggito also conveyed the policy development regarding a 25 basis point increase in the Deposit Guarantee Interest Rate (TBP) for rupiah deposits in commercial banks to 3.75%, with rupiah deposits in People’s Economy Banks (BPR) rising by 25 bps to 6.25%, while the rate for foreign currency deposits in commercial banks remains at 2.00%. This TBP policy is a response to developments in the financial sector, where market interest rates have risen albeit in a limited manner, banking performance remains strong, and the deposit guarantee coverage level has begun to decline from 93% to 92%. In terms of premium payment relaxation policies for banks affected by the Sumatra disaster, LPS is providing facilitation facilities to those who submit claims. Looking at current banking developments, LPS is optimistic that the targets for guarantee premium income and the Banking Restructuring Programme (PRP) premiums are on track. As of April 2026, LPS recorded revenue of Rp 14.5 trillion, more than half of the 2026 target.