More resignation rumors plague IBRA management<\/p>\n
JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA)
\nwas hit by rumors of more major resignations following a report
\non Monday that claimed its chairman Edwin Gerungan and deputy
\nchairmen Irwan Siregar and Slamet Sumantri planned to quit from
\nthe agency due to the unbearable level of outside intervention,
\nincluding politicians and people claiming to be close to the
\nPresident.<\/p>\n
But finance minister Prijadi Praptosuhardjo denied the rumors.<\/p>\n
\"It is not true,\" Prijadi announced to reporters, but declined
\nto provide further comments.<\/p>\n
IBRA officials were not available for comment.<\/p>\n
The agency, a unit of the finance ministry, controls more than
\nRp 600 trillion (US$58 billion) worth of various assets
\ntransferred from ailing and closed down banks and former bank
\nowners. IBRA is responsible for selling the assets to raise cash
\nto help finance the state budget deficit. It is also mandated to
\nrestructure some of the assets, in the case of non-performing
\nbank loan (NPL) assets.<\/p>\n
This year, the agency is targeted to raise around Rp 27
\ntrillion in cash plus restructure some Rp 10 trillion worth of
\nNPLs under its management.<\/p>\n
A major resignation at IBRA would have a negative impact on
\nthe state budget as well as the overall economy as further delays
\nin the sale of IBRA's key assets could further erode investor
\nconfidence.<\/p>\n
Edwin, a career-banker, assumed his current position last
\nNovember after President Abdurrahman Wahid's initial candidates
\nwere not welcomed by the financial market and the International
\nMonetary Fund.<\/p>\n
One of the most important tasks of the agency this year is to
\ncomplete the divestment of government majority ownership in the
\npublicly listed Bank Central Asia (BCA) and Bank Niaga during the
\nfirst semester. The sale was supposed to be implemented late last
\nyear but it was delayed due to unfavorable market conditions. The
\ndelay has irked the IMF, which later suspended the disbursement
\nof its latest $400 million loan tranche to Indonesia.<\/p>\n
The agency has often been a target of intervention not only
\nfrom politicians, but also from senior ministers.<\/p>\n
Earlier this year, two IBRA deputy chairmen Jerry Ng and
\nMahmuddin Yassin tendered their resignation amid reports that
\nthey could no longer work effectively due to strong intervention
\nincluding from the so-called Financial Sector Policy Committee
\n(FSPC), which groups several senior economic ministers but is
\neffectively run by Coordinating Minister for the Economy Rizal
\nRamli.<\/p>\n
The FSPC has the final say on any major transactions made by
\nIBRA.<\/p>\n
Jerry was recently replaced by Felia Salim, a former FSPC
\nsecretary, while Mahmuddin remained in his position after Prijadi
\nrejected his resignation request.<\/p>\n
There have also been rumors that Edwin has been under strong
\npressure to agree to a proposal from Japan's Marubeni Corp. in
\nthe restructuring of petrochemical company PT Chandra Asri, which
\nowes around Rp 3 trillion to the agency and around $700 million
\nto a Marubeni-led consortium.<\/p>\n
Edwin has demanded Marubeni have a greater equity stake in
\nChandra Asri, while the Japanese creditor has insisted that it
\nonly wants to convert around $100 million of its debts into a 20
\npercent equity.<\/p>\n
IBRA has also been under pressure lately to sell its dollars
\nto help defend the ailing rupiah. The agency is in control of
\naround $500 million mostly from the sale of assets, and has so
\nfar only converted just over $50 million.<\/p>\n
Recent reports also indicated that several indebted
\nconglomerates had placed pressure on IBRA to restructure their
\ndebts under favorable terms. IBRA was supposed to have reached a
\nfinal debt restructuring agreement last week with the Texmaco
\nGroup.<\/p>\n
IBRA had also encountered problems with its recent sale of 25
\noil palm plantations to Malaysia's Kumpulan Guthrie Bhd. Some
\nlegislators had demanded that the government cancel the deal on
\nthe grounds of lack of transparency and nationalist sentiment.<\/p>\n
Legislators also demanded IBRA cancel the appointment of a
\nconsortium led by Malaysia's DRB-Hicom as the preferred bidder
\nfor the acquisition of a toll road project in Jakarta. (rei)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/more-resignation-rumors-plague-ibra-management-1447893297",
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