BRI restructures Rp 3.56t of NPLs<\/p>\n
JAKARTA (JP): State-owned Bank Rakyat Indonesia (BRI) said
\nhere on Wednesday it had successfully restructured about Rp 3.56
\ntrillion (about US$490 million) of its nonperforming loans
\n(NPLs).<\/p>\n
The bank said the figure represented 64 percent of its
\ncorporate NPLs, reducing the value of its total problematic loans
\nto Rp 1.96 trillion at the beginning of the year 2000.<\/p>\n
The bank expected it would be able to restructure all its
\nremaining NPLs in the next three months.<\/p>\n
The bank explained that the Rp 1.96 trillion is a conservative
\nfigure, as it uses a stricter standard compared with that used by
\nBank Indonesia's when categorizing restructured NPLs.<\/p>\n
\"For instance, based on Bank Indonesia's standard, NPLs are
\nstated to be sound after the signing of a restructuring
\nagreement,\" BRI said, adding that, unlike the central bank, it
\noften waited for three to six months to evaluate the realization
\nof an agreement with a debtor before revising a credit's status.<\/p>\n
The bank said that in restructuring NPLs, BRI required a final
\ncash settlement for every amount due, including the interest
\npayable prior to any debt restructurization program.<\/p>\n
The interest rate applied is the one valid at the time of the
\ndue date and applicable to both rupiah loans and foreign currency
\nloans.<\/p>\n
\"If those conditions are met, BRI is willing to write off the
\npenalty interest,\" it said.<\/p>\n
After the completion of a debt restructuring program, BRI then
\nsets a new interest rate, based on the debtors' capability, which
\nis measured by the Internal Rate of Return (IRR). For rupiah
\nloans, BRI sets the IRR at 1 percent higher than Bank Indonesia's
\nthree month promissory notes (SBIs). For U.S. dollar loans, the
\nIRR is set at 2 percent higher than the Singapore Inter-Bank
\nOffered Rates (SIBOR). (hen)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bri-restructures-rp-356t-of-npls-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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