15 firms seal deals on debt restructuring<\/p>\n
JAKARTA (JP): Chairman of the Jakarta Initiative Task Force
\nYusuf Anwar announced on Monday that 15 companies reached a debt
\nrestructuring agreement with their creditors over US$1.5 billion
\nin foreign exchange debt and Rp 900 billion in local currency
\ndebt.<\/p>\n
He said they were part of the 168 indebted companies which
\nenlisted assistance from the task force to facilitate a debt
\nrestructuring process with creditors.<\/p>\n
He said the companies held more than Rp 10 trillion in local
\ncurrency debt and $11 billion in foreign exchange debt.<\/p>\n
\"We will accelerate the restructuring process of these
\ncompanies to create more successful stories,\" he told reporters
\non the sidelines of a one-day seminar on good corporate
\ngovernance.<\/p>\n
He explained the task force would work together with the
\nIndonesian Bank Restructuring Agency (IBRA) because about 50
\npercent of the debts were linked to the agency.<\/p>\n
The government, he added, would announce details of the
\nrestructuring deal for these debtors on Friday.<\/p>\n
IBRA has assumed over Rp 100 trillion in nonperforming loans
\ndispensed by the country's seven state banks to 1,200 companies.<\/p>\n
The government said in its latest letter of intent to the
\nInternational Monetary Fund that at least 20 of the largest
\ndebtors at the state banks would be encouraged to join a
\ngovernment-backed restructuring deal.<\/p>\n
IBRA chairman Glenn S. Yusuf said last week that the 20
\nlargest debtors owed Rp 60 trillion in nonperforming loans at the
\nstate banks.<\/p>\n
A debt restructuring deal of the major debtors is expected to
\nprovide momentum for the restructuring of the overall real
\nsector, which together with the bank restructuring program is
\nessential for the country's economic recovery.<\/p>\n
Yusuf said the largest obstacle toward a debt restructuring
\ndeal was to have both the creditors and the debtors to come
\ntogether to negotiate a restructuring deal.<\/p>\n
\"It is difficult to encourage both debtors and creditors to
\nsit at the same table,\" he said.<\/p>\n
Local companies have about $65 billion in overseas debts and
\nmore than Rp 600 trillion in local debts.<\/p>\n
The government launched the Indonesian Debt Restructuring
\nAgency (INDRA) in August last year to ensure the availability of
\nforeign currency at the best exchange rate level for debtors who
\nhave reached a restructuring agreement with their debtors.<\/p>\n
But INDRA announced last week that it would extend the
\ndeadline for entry to its program from June 30 to December 31
\nbecause there have been no takers so far.<\/p>\n
INDRA chairman Sumitro said on Thursday that most companies
\nwere expected to reach agreement with their foreign creditors
\nduring the second half of the year.<\/p>\n
\"This is because companies are still facing limited cash flow,
\nunpredictable inflation rates, as well as unfavorable (social and
\npolitical) conditions,\" he said.<\/p>\n
He said that two companies were set to join INDRA's program,
\nbut declined to identify them. (rei)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/15-firms-seal-deals-on-debt-restructuring-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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