The two lenders will immediately start the integration process, which will boost Bank Permata's capital to more than 40 trillion rupiah ($2.72 billion) and raise its classification to the country's highest banking tier.

Thailand's largest lender by assets Bangkok Bank agreed to buy an 89.1% stake in Bank Permata for about $2.7 billion last year.

"As a unified entity, we will have a greater ability to support customer growth, while fulfilling the financial needs of Indonesian individuals and businesses," Chartsiri Sophonpanich, Bangkok Bank president and Bank Permata president commissioner, said in the statement.

Bank Permata, among the top 15 banks in Indonesia, recorded a 48.5% drop year-on-year in its profits to 366.48 billion rupiah in the first half of 2020, due to the impact of coronavirus social restrictions.

($1 = 14,705.0000 rupiah)

(This story corrects paragraph 3 to reflect that Bangkok Bank is now Thailand's biggest lender by assets and no longer third largest)

(Reporting by Tabita Diela; Editing by Martin Petty)