The Financial Services Authority (OJK) changed the status of PT Prima Master Bank or Bank First Masters from National Private Commercial Bank (BUSN) to People’s Credit Bank (BPR). Why did OJK change the status of Banca Prima Master?
Based on OJK monitoring of the implementation of regulation number 12/POJK.03/2020 on the consolidation of commercial banks on the achievement of a minimum core capital (MIM) of IDR 3 trillion, out of 37 BUSN and owned banks of the regional government which have core capital below IDR 3 trillion, a number of banks have made additional capital injections, formed a Bank Business Group (KUB), merged, bought out and invited strategic partners.
In general, the BUSNs fulfilled the MIM by 31 December 2022. However, there is one BUSN, i.e. PT Prima Master Bank, which did not fulfill the MIM by the deadline set by the regulation.
In accordance with the POJK, banks that fail to meet MIM compliance requirements by the deadline of December 31, 2022, the OJK will enter into a business license change for commercial banks to become rural banks.
“Therefore, OJK’s Board of Commissioners, meeting on 4 January 2023, decided to change the business license of a commercial bank to become a BPR for PT Prima Master Bank,” quoted from OJK’s written statement, Monday (9/1 /2023).
This is OJK’s step to continuously supervise the policy of capital strengthening and bank consolidation so that it can increase its contribution to national economic growth.
The change of business license from a commercial bank to a rural bank is made after the OJK has carried out the supervision and guidance, including by allowing sufficient time for the shareholders and management of PT Prima Master Bank to determine a strategy to meet the MIM, either through additional capital deposits or consolidation.
With the change of PT Prima Master Bank’s business license to become the BPR, all customers and the public can still bank and public deposits are still guaranteed by LPS in accordance with current regulations.
“Going forward, OJK will continue to strengthen capital, performance and bank consolidation, including meeting a MIM of IDR 3 trillion for regional government-owned banks by 31 December 2024, as outlined in the above POJK , and IDR 6 billion for BPR and BPRS, respectively, no later than 31 December 2024 and 31 December 2025, as indicated in POJK number 5/POJK.03/2015 and POJK number 66/POJK.03/ 2016,” OJK said.