IBRA vows to regain Bank Bali's Rp 546b<\/p>\n
JAKARTA (JP): Chairman of the Indonesian Bank Restructuring
\nAgency (IBRA) Glenn S. Yusuf said on Monday that his organization
\nwould do its utmost to recover the Rp 546 billion (US$80 million)
\npayment from Bank Bali to an investment firm.<\/p>\n
He said that IBRA could use government regulation No. 17\/1999,
\nwhich empowered the agency to unilaterally annul earlier
\ncontracts made by banks under its control which were loss-causing
\nventures for the government.<\/p>\n
\"IBRA can annul the contract if it wants to. But we're still
\nwaiting for the completion of the investigation (of the Bank Bali
\nscandal),\" he said on the sidelines of a meeting with top
\nofficials of the House of Representatives.<\/p>\n
IBRA is an agency under the Ministry of Finance set up last
\nyear to help restructure and recapitalize the country's ailing
\nbanking sector. It has so far taken over 13 private banks and
\nrecapitalized seven private banks.<\/p>\n
The use of the regulation would be a test case of IBRA's
\npower.<\/p>\n
He said that the Ramli family, the former majority shareholder
\nin Bank Bali, must repay the loss because the government would
\nnot contribute a single cent toward the payment.<\/p>\n
IBRA has to recover the loss to prevent the recapitalization
\ncost of Bank Bali, currently estimated at Rp 4.3 trillion, from
\nsoaring.<\/p>\n
Separately, Bank Indonesia Governor Sjahril Sabirin said that
\nthe funds would have to be returned if their transfer was proven
\nillegal.<\/p>\n
Shake-up<\/p>\n
Calls are growing for a massive shake-up of IBRA's management
\nand the prosecution of Bank Bali's former directors on charges of
\ncorruption.<\/p>\n
Ichsanuddin Noorsy and Thomas Suyatno, members of the House of
\nRepresentatives budget and financial commission, were skeptical
\nthat IBRA remained unaware of the questionable deal between Bank
\nBali and investment firm, PT Era Giat Prima (EGP), in which the
\nbank paid Rp 546 billion for assistance in recouping the bank's
\ninterbank claims on closed-down banks from IBRA.<\/p>\n
\"After all, Bank BDNI and other closed and taken-over banks
\nwhich owed interbank debts to Bank Bali are all under the control
\nof IBRA,\" Noorsy added.<\/p>\n
Expressing shock over the scandal, Suyatno said he had never
\nknown of blatant fraud involving such a huge sum during his 30-
\nyear career in the banking industry.<\/p>\n
The scandal has damaged the reputation of IBRA, which now
\ncontrols about Rp 600 trillion in state assets. Banking legal
\nexpert Pradjoto disclosed late last month the scandal and
\nimplicated IBRA's deputy chairman Pande Lubis.<\/p>\n
Glenn declined to confirm reports that Pande Lubis had been
\nsuspended, but said that all officials, including himself, should
\nbe suspended if they were implicated in the scandal to allow for
\nthe investigation to proceed.<\/p>\n
Bank Bali is one of the country's private banks selected to
\njoin the government-sponsored recapitalization program.<\/p>\n
Glenn said that the government was still committed to
\nrecapitalizing Bank Bali although the scandal could slow down the
\nrecapitalization process.<\/p>\n
\"This (the case) is just an anomaly ... Bank Bali is still a
\ngood bank,\" Glenn said.<\/p>\n
IBRA confirmed last week Pradjoto's claim that Rp 546 billion
\nwas transferred from Bank Bali in early June to EGP, which is
\nowned by businessman Setya Novanto, as a commission for the
\nfirm's services in helping the bank recoup some Rp 904 billion in
\ninterbank claims on closed banks.<\/p>\n
The then owner and president of Bank Bali, Rudy Ramli, signed
\nthe contract with EGP in January.<\/p>\n
IBRA said that Bank Bali did not need to use a third party to
\nrecoup its interbank claims because it was guaranteed by the
\nagency through the government blanket guarantee program.<\/p>\n
Standard Chartered Bank of the UK found out about the transfer
\nof the Rp 546 billion from Bank Bali on July 20 after the former
\ncompleted its due diligence audit on the latter, IBRA said.<\/p>\n
Standard Chartered planned to buy a 20 percent stake in the
\nbank.<\/p>\n
Bank Bali was put under IBRA control after the Ramli family
\nfailed to put up its share of the recapitalization funding by the
\nJuly 23 deadline.<\/p>\n
Publicly listed Bank Bali will offer a rights issue in
\nSeptember to raise proceeds for its recapitalization program.
\nStandard Chartered plans to buy 20 percent, with the government
\nto purchase up to 80 percent of the remaining new shares.<\/p>\n
Separately, National Police spokesman Brig. Gen. Togar
\nSianipar said the police had identified potential suspects in the
\nscandal, including former Bank Bali administrators Rudy Ramli,
\nRusli Surjadi, Firman Sucahyo and Henri Kurniawan, EGP executives
\nSetya Novanto and Joko S. Chandra and IBRA deputy chairman Pande
\nLubis.<\/p>\n
\"We have asked the immigration office to impose travel bans on
\nthese executives, except Lubis,\" Togar added. (rei\/ylt\/jsk)<\/p>",
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