Bank Niaga loses $475m

Bank Niaga loses $475m

JAKARTA (JP): Publicly listed Bank Niaga has reported a net
loss of Rp 3.8 trillion (about US$475 million) in 1998, a
reversal from its Rp 48 billion net profit the previous year.

The massive deficit mainly resulted from a sharp interest loss
due to a negative-spread situation and the fat provision for bad
debts, which totaled Rp 3.6 trillion.

The bank booked interest income of Rp 2.6 trillion in 1998,
but paid a higher interest expense of Rp 3.9 trillion, resulting
in a net interest loss of Rp 1.3 trillion.

The deteriorating quality of the bank's credit portfolio
increased its bad debt provision to Rp 2.3 trillion in 1998 from
Rp 180 billion the previous year.

Bank Niaga was taken over by the government last month
following the failure of the bank's majority shareholders to
provide fresh funds for its recapitalization.

The government subsequently appointed a caretaker team led by
Rudy Capelle to run the bank. Members of the team include Paulus
Wiranata, Daniel James Rompas, Kathay Gusti, Andreas E. Susetyo,
Andi Mohammad Hatta and Sigid Moerkardjono. (udi)