Bank Mandiri told to transfer bad loans

Bank Mandiri told to transfer bad loans

JAKARTA (JP): Finance minister Bambang Sudibyo said on Monday
state Bank Mandiri should "immediately" transfer its remaining
bad loans to the Indonesian Bank Restructuring Agency (IBRA).

He said there should be no more delays in the transfer of the
bad loans to the agency.

"All category five (bad) loans must be transferred (to IBRA),"
Bambang told reporters following a monthly meeting with the
central bank.

Under the government bank recapitalization program, all
recapitalized banks must transfer their bad loans or category
five loans to IBRA to have a clean balance sheet.

The government completed the recapitalization of Bank Mandiri
in December by injecting some Rp 178 trillion worth of bonds.

Bank Mandiri passed some Rp 76 trillion in bad loans to IBRA
last year. This represents about half of its total bad loans.

Bank Mandiri, the country's largest bank, was formed in July
1999 through a merger of Bank Bumi Daya (BBD), Bank Dagang Negara
(BDN), Bank Ekspor Impor (Bank Exim) and Bank Pembangunan
Indonesia (Bapindo).

Separately, IBRA senior official Andreas Bunanta said on
Monday that there were about Rp 23 trillion in bad loans left at
Bank Mandiri.

He said the bank said it wanted to manage and restructure
about Rp 9 trillion of the loans until June this year.

He said the remaining Rp 14 trillion should have been
transferred by the end of last year.

State banks were treated as the cash cows of politicians and
well-connected businessmen in the past during the authoritarian
rule of former president Soeharto.

There has been increasing concern that state banks joining the
government bank recapitalization program were trying to keep the
bad loans out of IBRA's hands.

State Bank BNI has recently been attacked by the media on
allegations that it was trying to keep bad loans owed by
integrated textile Texmaco Group.

The loans were finally transferred by BNI late last week after
the central bank issued a ruling for the transfer.

The Texmaco loans transferred by BNI totaled more than Rp 9
trillion.

Texmaco was hit by controversy last year after a minister
revealed that the company had used its connection with former
president Soeharto to obtain more than Rp 9 trillion in loans
from Bank BNI.

The government is set to soon recapitalize publicly listed
Bank BNI. (rei)