OJK ensures no potential for bank rush amidst rupiah weakening

The Financial Services Authority (OJK) has ensured that there is currently no potential for large-scale withdrawals, or a bank rush, alongside the weakening of the rupiah exchange rate, as Indonesia’s political, security, and economic situations are deemed to remain conducive.

“Bank rushes are generally caused by issues regarding public trust in the banking system. Therefore, efforts to maintain public confidence must be continuously undertaken by bank management,” said OJK Executive Head of Banking Supervision, Dian Ediana Rae, during a press conference following the May 2026 RDKB meeting in Jakarta on Friday.

She added that public trust in banking can be maintained through efforts to keep bank performance high, the implementation of prudential banking principles, and the active execution of risk management across all business lines.

Dian noted that OJK recognises that, theoretically, the weakening of the rupiah exchange rate could lead to higher prices for imported goods (imported inflation), reduce public purchasing power due to rising costs, and burden the fiscal budget as government subsidies remain significant. Conversely, she noted that a weaker exchange rate can increase the competitiveness of Indonesian export products in the global market and make Indonesia relatively more attractive to international tourists.

“Therefore, we continuously conduct regular monitoring and evaluation regarding exchange rate movements and their impact on banking,” said Dian.

As of April 202age, the Net Foreign Exchange Position (PDN) ratio of the banking sector was recorded at 1.63 per cent, with a long position, meaning foreign currency assets are greater than foreign currency liabilities. This, according to Dian, indicates that the banking sector’s direct exposure to exchange rate risks is relatively well-maintained and controlled. “Consequently, the immediate impact of the rupiah’s weakness on banking stability remains relatively limited,” she stated.

However, Dian noted that a prolonged weakening of the rupiah would impact debtors with exposure vulnerable to foreign exchange movements. This could ultimately pressure debtors’ ability to pay and increase credit risk. In such conditions, OJK continues to request that banks ensure adequate formation of impairment loss allowances (CKPN) and maintain strong capital resilience.

To ensure that Indonesian banks have measured and controlled various risks, OJK continues to monitor risk developments and requests banks to implement comprehensive risk management. To measure banking resilience against various potential macroeconomic shocks, OJK also routinely conducts stress tests. Based on the results of these stress tests, the banking sector is deemed capable of facing potential pressures arising from the weakening rupiah.

As of April 2026, the capital adequacy ratio (CAR) of the banking sector, after accounting for dividend distributions, was recorded at 23.97 per cent. This signifies strong capital resilience as an adequate risk mitigation buffer. Meanwhile, credit quality remains maintained with a gross NPL ratio of 2.17 per cent and a net NPL of 0.84 per cent, while the loan at risk (LAR) was recorded at 8.82 per cent. Additionally, the liquidity coverage ratio (LCR) stands at 192.37 per cent, with the liquid assets/non-core deposit (AL/NCD) ratio and liquid assets/third-party funds (AL/DPK) ratio at 111.13 per cent and 25.35 per cent, respectively.