The recent suspension of operations of large-scale savings banks caused significant losses not only to depositors who did not anticipate such events but also to the national economy. The BIS ratio is calculated by dividing a savings bank's equity capital by its risk-weighted assets, and savings banks with a BIS ratio of 5% or above are classified as sound institutions. However, many of the savings banks whose operations were suspended had BIS ratios of 5% or above in the year immediately preceding their suspension. This study aimed to analyze whether the BIS ratio, which is used to assess the soundness of savings banks, is an appropriate metric for predicting savings bank insolvency. Specifically, this study sought to verify whether the simple debt ratio, which is generally used for predicting insolvency, is more appropriate than the BIS ratio—a soundness assessment criterion designed for banks engaged in international financial activities—for small-scale financial companies such as mutual savings banks whose primary business operations are confined to local markets. This study conducted logit analysis on insolvency prediction, covering a total of 36 savings banks whose operations were suspended from 2004 to May 2012 and 73 savings banks in normal operating condition that met certain criteria. The results showed that the debt ratio was a significant variable in predicting savings bank insolvency both two years before (t-2) and one year before (t-1) the suspension of operations. However, the BIS ratio was significant only one year before (t-1) the suspension. Furthermore, the insolvency prediction model using the debt ratio showed higher prediction accuracy than the BIS ratio insolvency prediction model both two years and one year before the suspension of operations. In insolvency prediction, timeliness—the ability to predict as early as possible—is important alongside accuracy. Therefore, the debt ratio can be considered a more useful variable than the BIS ratio for predicting savings bank insolvency. Financial authorities and investors need to consider the debt ratio in addition to the BIS ratio when predicting and assessing the suspension of savings bank operations. The significance of this study lies in presenting empirical analysis results demonstrating that, for the early detection of operational suspensions of savings banks that perform only simple deposit and lending operations, the simple debt ratio can serve as an appropriate variable in addition to the BIS ratio. Therefore, it is hoped that the results of this study can contribute to minimizing the social costs of operational suspensions by enabling financial authorities and various stakeholders to respond early to savings bank insolvency.