Lay off nearly half of their 26,000 workers. Redesign branches with new floor configurations, fresh paint and snazzy logos. Welcome to Bank Mandiri, Indonesia's first reconditioned, post-Crisis bank, which opened its doors on Aug. 2. So does the rest of Indonesia. The nation's recapitalization program is probably the most expensive in banking history anywhere - and almost certainly the most challenging.
Bad loans make up three-quarters of the cost.
And as if that weren't enough, the government must slash both the number of banks and overall bank employment. Bank Mandiri represents the prototype for this massive effort, the first of what promises to be several merged and reconditioned banks in Indonesia. On one level, the result is impressive. Twenty-six thousand employees were cut to 14,000. The goal all along was to get Mandiri in a place where it could survive on its own.