The warning by Hubert Neiss came after Jakarta at the last minute put off by two weeks an announcement due February 27 on banks it plans to shut down, saying it needed more time.

"It requires better preparation to annonce the liquidation and the IMF understands that. But after this, hopefully there will be no more delays," Neiss said in interview with the Kompas daily from Washington.

"President BJ Habibie did inform the International Monetary Fund, the World Bank and the Asian Development Bank of the delay.

"But we hope there will not be another postponement. It (the closures) is important to restore confidence in the Indonesian market," he said.

Nsiss did not comment in the interview on rumours of interference in the bank-closure process by well-connected bank-owners, noting Habibie hadpledged there would not be another delay.

Asked how many banks should be closed, Neiss said it was not easy to give figure, but added that Indonesia had too many banks.