Bank Harapan owner Hendra Rahardja is rumored to have fled to Hong Kong. The banking sector can make or break Indonesia's economic recovery. Indonesia has a history of bank closures like Bank Summa in the early 1990s. No bank, however bad its problems, has ever been closed in Thailand. Indonesians are jittery, and given the history, they have reason to worry.
People expect other banks to fall.
A list of 36 lenders whose licenses are allegedly being reviewed by the central bank is going the rounds in Jakarta. Djiwandono has been quick to reassure the public. The banks that will be liquidated are only those 16 and no more. But industry sources say central bank officials had told them that at least 20 banks would be closed, with up to 40 others put on the watch list. The queues last week may have something to do with it.