BEI channels $5 million in first export credits<\/p>\n
JAKARTA (JP): Newly established Bank Expor Indonesia (BEI) has
\nchanneled a total of US$5 million in export credits since it
\nbegan operations on Sept. 1, a bank official said here on
\nThursday.<\/p>\n
Speaking during a break in the 1999 Export Forum here, BEI
\ndirector Budi Mulya said the credits were channeled to four
\nexport-oriented companies through a third-party bank.<\/p>\n
\"We channeled the money to the four companies through Bank
\nCIC,\" Budi said. Bank CIC is Bank Century Intervest Corporation<\/p>\n
He said BEI expected to gradually increase its export credit
\nfinancing to $70 million per month.<\/p>\n
BEI was established in May with paid-up capital of Rp 3
\ntrillion (about $425 million at the current exchange rate) to
\nhelp finance the import of raw materials for export-oriented
\ncompany.<\/p>\n
Several exporters expressed skepticism earlier this month
\nabout the benefits of BEI, saying that providing funds through
\nthird-party banks would only increase the costs of loans.<\/p>\n
Budi defended the two-step lending process, but conceded that
\nchanneling export credits through third-party banks marginally
\nraised the cost of the loans.<\/p>\n
He said as a new bank, BEI still lacked the facilities and
\npersonnel to provide the credits directly to exporters.<\/p>\n
Budi estimated some 22 banks had agreed to cooperate with BEI
\nin channeling funds to exporters.<\/p>\n
\"We've discussed our idea with the banks' management, but we
\nhaven't yet detailed the cooperation on a operational level,\" he
\nsaid.<\/p>\n
Without naming particular banks, he said state banks may soon
\nbegin channeling BEI loans.<\/p>\n
Budi also said BEI planned to become a direct funding bank,
\nbut he declined to say when this would occur.<\/p>\n
\"We've already forwarded the legal aspects of the plan to the
\ngovernment, but we're still waiting for the new government to be
\nformed,\" Budi said.<\/p>\n
Responding to criticism of the high margin BEI has set on its
\nloans, Budi said that as a company accountable to its
\nshareholders it must obtain a good rate of return on assets
\n(ROA).<\/p>\n
\"In setting the margin we refer to three factors: proficiency,
\nROA and overhead costs,\" he said, adding that the bank's rates
\nare still competitive in the market.<\/p>\n
Aside from having received funds from the government, the bank
\nis also expected to obtain some $1 billion from the Japan Export
\nImport Bank.<\/p>\n
\"The funds have been on standby for a year now and we expect
\nthey will soon be available to us,\" he said.<\/p>\n
The bank's office is located in Tower II of the Bursa Efek
\nJakarta Building on Jl. Sudirman in Central Jakarta and currently
\nemployees 70 people.<\/p>\n
In its company profile, BEI describes itself as a nondirect
\nlending and noncompetitive bank.<\/p>\n
Working capital credits and export credits are channeled
\nthrough appointed banks, which bear all the risks.<\/p>\n
Budi said BEI also provided loans under cofinancing schemes
\nwith other commercial banks.<\/p>\n
The 1999 Export Forum was held on Thursday in conjunction with
\nthe 14th National Merchandise and Commodity Show at the Jakarta
\nFair Grounds in North Jakarta, which opened last Wednesday.<\/p>\n
The five day show, with the theme Resource Indonesia '99,
\nincludes exhibits of textile products, chemicals, plastic goods,
\ncosmetics, handicrafts and agricultural products.(03)<\/p>",
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"sponsor": "Okusi Associates",
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