Forum angered by debt restructuring<\/p>\n
JAKARTA (JP): The Communication Forum of Borrowers complained
\non Friday over the slowness of the debt restructuring program
\nexecuted by the Indonesian Bank Restructuring Agency (IBRA).<\/p>\n
Forum chairman BK. Hadisoebroto said the borrowers were
\ndisadvantaged because the agency was not promoting a beneficial
\ndebt restructuring process.<\/p>\n
"It is a shame that only 63 companies of 1,600 under IBRA have
\njoined the agency's restructuring program," he said.<\/p>\n
The forum currently comprises 96 corporate borrowers which owe
\na total of about Rp 30 trillion to IBRA.<\/p>\n
They are part of the group of companies whose nonperforming
\ndebts were transferred to IBRA as part of the government-
\nsponsored bank restructuring program. The agency has so far taken
\nover about Rp 230 trillion in bad debts from closed, nationalized
\nand state banks.<\/p>\n
Hadisoebroto accused IBRA of failing to create a fair process
\nin the restructuring of the borrowers' debts. He said the agency
\nonly allowed limited involvement of the borrower in the
\npreparation of the business plan to be used as the basis of a
\ndebt restructuring program.<\/p>\n
"What should be done is that we prepare our own business plan
\nbased on a self-assessment, which would then be properly
\nevaluated and agreed upon by IBRA if everything in the business
\nplan generally fits normal requirements."<\/p>\n
He said differences in appraising the business plans often
\nresulted in a delay in debt restructuring talks.<\/p>\n
"And many of the borrowers did not even have a chance to go
\nthrough the above process, but instead were forced to close down
\noperations because of IBRA's mistreatment."<\/p>\n
He said the borrowers lost all hope of restructuring their
\ndebts when the names of their companies were published in the
\nmedia and labeled "problem" borrowers.<\/p>\n
"Many of us have been unable to continue our businesses since
\nthen. We lost relationships with all our banks that were helping
\nus finance our exports."<\/p>\n
Hadisoebroto said the announcement hit the companies when they
\nwere at their most vulnerable.<\/p>\n
"How can we start debt restructuring negotiations under such
\nconditions?"<\/p>\n
Many of the borrowers are in the real sector, he added.<\/p>\n
"It is tied up with the fact that most IBRA officials lack the
\nknowledge, experience and skill of the real sector business."<\/p>\n
He said borrowers experienced difficulty in setting up
\nmeetings with IBRA officials.<\/p>\n
He claimed that letters requesting a meeting were sent to
\nIBRA's office on at least three occasions, but there was no
\nresponse.<\/p>\n
The forum said it would report its complaints to the House of
\nRepresentatives and the International Review Committee, IBRA's
\nsupervisory board.<\/p>\n
IBRA's public relations officer Franklin Richard said the
\nborrowers were exaggerating their grievances.<\/p>\n
"Their claims are simply out of proportion," Franklin told The
\nJakarta Post.<\/p>\n
He said every borrower's problems were unique, necessitating
\nindividual debt plans.<\/p>\n
"It is impossible to generalize about the problems of all the
\nborrowers."<\/p>\n
IBRA's team also must trace and compile data on each
\nborrower's creditors, and data compilation process could be
\nlengthy due to the different creditors.<\/p>\n
Franklin said the fact that IBRA completed debt restructuring
\nof 63 companies in a relatively short time was an achievement.<\/p>\n
He said the document transfer of all the 1,600 borrowers to
\nIBRA was only completed in July.<\/p>\n
"From July, we have had less than a year. Take for comparison
\nPT Astra International, which completed a debt restructuring deal
\nin 18 months' time," he said of the major automaker.<\/p>\n
Franklin also said IBRA retained continual consultation with
\nabout 40 financial consultants, who possessed a wide range of
\nreal sector business expertise, in negotiating debt restructuring
\nwith the borrowers. (udi)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/forum-angered-by-debt-restructuring-1447893297",
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"sponsor": "Okusi Associates",
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