IBRA plans to sell unrestructured loans worth Rp 8t<\/p>\n
JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA)
\nplans to sell off Rp 8 trillion (about US$919 million) in
\nunrestructured loans via an open tender process starting this
\nyear, a source at the agency said on Thursday.<\/p>\n
He said the Rp 8 trillion would consist of small and medium
\nloans of between Rp 5 billion to Rp 50 billion.<\/p>\n
\"Details of the plan are tentative, we're still finalizing
\nit,\" he told The Jakarta Post over the phone.<\/p>\n
He said IBRA would sell off the unrestructured loans to the
\nhighest bidder through an open tender.<\/p>\n
He refused to estimate the recovery rate expected from
\noffering the unrestructured loans, saying it depended on the
\nbidders.<\/p>\n
IBRA is in charge of restructuring nonperforming loans (NPLs)
\nit took over from local banks hit by the 1997 economic crisis.<\/p>\n
In exchange for the loans, IBRA injected the banks with
\ngovernment bonds, called recapitalization bonds, worth Rp 430
\ntrillion.<\/p>\n
The agency must sell the loans it has restructured to recoup
\nsome of the costs from paying interest on the recapitalization
\nbonds.<\/p>\n
Another way is through asset bonds swaps, where IBRA exchanges
\nrestructured loans for recapitalization bonds in banks.<\/p>\n
IBRA had some Rp 16 trillion in small and medium loans (out of
\nthe more than Rp 200 trillion in NPLs under its management), the
\nsource continued.<\/p>\n
He said their restructuring was currently managed by IBRA's
\noutsourcing agents, but it had had poor results.<\/p>\n
He cited Bank Danamon, Bank Bukopin and Bank Artha Graha as
\namong those assigned with the restructuring of these loans.<\/p>\n
\"Instead of continually paying the banks fees, we've decided
\nto just sell the (unrestructured) loans,\" he explained.<\/p>\n
He said IBRA had to pay the banks a monthly fee of Rp 1
\nmillion for each debtor's account, which amounted to thousands of
\nmillions.<\/p>\n
He said the banks, rather than restructuring the loans,
\npreferred to collect them from debtors to earn a success fee.<\/p>\n
That, however, took longer than restructuring the loans,
\ncausing IBRA's expenses on their fees to grow with each month, he
\nsaid.<\/p>\n
The source further said that IBRA also planned to sell off
\nunrestructured corporate loans valued above Rp 50 billion.<\/p>\n
Details of the plan were not yet available, he said.<\/p>\n
Separately, Bank Danamon president Arwin Rasyid said the
\nbank's portfolio of IBRA unrestructured loans totaled Rp 6.5
\ntrillion.<\/p>\n
\"We've been doing IBRA's restructuring since mid 1999,\" he
\ntold the Post.<\/p>\n
In regard to IBRA's plan to stop using Bank Danamon's
\nservices, Arwin said he had not heard of such a plan.<\/p>\n
But he added Bank Danamon was interested in joining IBRA's
\ntender, especially for loans from small and medium-sized
\nbusinesses.<\/p>\n
As restructured loans were normally sold at between 40 percent
\nto 55 percent of their original value, he said, he estimated IBRA
\nwould sell off the unrestructured ones at rates below 40 percent.<\/p>\n
Turning to the asset bonds swap scheme, Arwin said it was
\nprogressing slowly.<\/p>\n
The government, through IBRA, injected Bank Danamon with
\nrecapitalization bonds worth Rp 28.9 trillion.<\/p>\n
Exchanging them with restructured loans would ease the
\ngovernment's burden for paying the bank interests on the bonds.<\/p>\n
\"The problem now is that IBRA focuses too much on achieving
\nits target revenue as set out in the state budget,\" he told
\nreporters on the sidelines of a seminar held by Bank Indonesia.<\/p>\n
He said the agency faced heavy pressure to achieve its target
\nrevenue, which this year stood at Rp 27 trillion.<\/p>\n
For the first half of this year, the agency managed to secure
\nonly about Rp 11.2 trillion in revenue.<\/p>\n
\"Now it's August, IBRA will go all out to achieve the target
\nso now will it think about asset swaps,\" he said.(bkm)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/ibra-plans-to-sell-unrestructured-loans-worth-rp-8t-1447893297",
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