Jakarta. Indonesia's financial regulator has dismissed concerns over widespread layoffs in the country's banking industry, saying recent job cuts at KB Bank are an isolated case tied to the lender's business transformation rather than a broader industry trend.

Dian Ediana Rae, executive head of banking supervision at Indonesia's Financial Services Authority (OJK), said the workforce reduction at KB Bank was part of a turnaround program aimed at restoring the bank's health and had been carried out in accordance with labor regulations.

"The process complies with prevailing laws and regulations. Employees have received compensation, and this is part of the bank's restructuring program," Dian told reporters at the parliament complex on Wednesday.

He said the restructuring was permitted as long as employees' rights were fulfilled, including severance payments and other compensation. According to OJK supervisors, the restructuring process has been completed successfully.

"Based on reports from our supervisory team, everything is in order and has been settled," he said.

Dian stressed that the situation at KB Bank does not reflect conditions across Indonesia's banking industry, adding that OJK has not identified signs of mass layoffs at other banks.

"There are no indications of layoffs at other banks. This is specific to KB Bank," he said.

KB Bank has been implementing a turnaround strategy that includes greater use of technology to improve operational efficiency and accelerate banking services, particularly lending to micro, small and medium-sized enterprises (MSMEs).

Dian also expressed optimism about the banking sector's outlook, citing business plans submitted by 105 banks and reviewed by OJK. While some lenders have revised their projections, the industry as a whole still expects business growth this year.

The regulator's comments come as layoffs have attracted renewed public attention following reports that Indonesian e-commerce company Tokopedia has reduced its workforce, fueling concerns over continued cost-cutting across several industries.

According to Indonesia's Ministry of Manpower, more than 88,000 workers lost their jobs throughout 2025. Another 23,470 employees were laid off between January and May 2026.

KB Bank's financial statements show that the bank employed 2,265 workers, including temporary staff, as of March 31, 2026, down from 2,927 a year earlier, a reduction of 662 employees.

The bank also streamlined its branch network during the period, reducing the number of sub-branches to 120 from 141, while its full-service branches declined to 28 from 29.

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