OJK Reveals BPD Development as a Driver of Regional Economies

The Financial Services Authority (OJK) has provided an update on the development of Regional Development Banks (BPD) as part of efforts to drive regional economic growth. The progress was outlined in the BPD Strengthening Roadmap 2024-2027, which aims to increase the resilience of BPDs amid global economic challenges. Key areas of focus include IT development, digitalisation of services, strengthening human resource competencies, and capital reinforcement. Of the 27 BPDs, those that have met the minimum capital requirement of Rp 3 trillion achieved this partly through the synergy concept of Bank Business Groups (KUB). The development of BPDs is closely tied to regional budgets, as their business is intrinsically linked to government programmes currently undergoing budget efficiency measures. The OJK continues to encourage the strengthening of KUB synergy among BPDs so that successful parent banks can help ensure the success of member banks. Regarding the spin-off of BPD Sharia Business Units, this can be carried out once the unit meets the asset capital requirement of Rp 50 trillion or accounts for at least 50 percent of the parent bank’s assets.