BEI to cooperate with 15 foreign banks

JAKARTA (JP): The newly established Bank Ekspor Indonesia (BEI) will cooperate with 15 foreign banks in financing the imports of export-oriented Indonesian companies, a central bank official said here on Tuesday.

The head of the Bank Indonesia Task Force on the Restructuring of Credit, Mukhlis Rasyid, said the foreign banks would include Standard Chartered Bank, Deutsch Bank and Bank of Tokyo Mitsubishi.

"These 15 banks will act as confirming banks for letters of credit issued by BEI to finance the imports of local export companies," he said.

BEI was established in May by the government to support export-oriented companies.

Unlike a conventional bank, BEI will raise funds from international financing agencies like Japan's Export Import Bank rather than the public to finance its activities.

BEI's main tasks will be to guarantee letters of credit and issue guarantees for domestic exporters who need loans from local banks to finance their operations.

"BEI will begin operating on Sept. 1," Mukhlis said. BEI was previously slated to begin operations earlier this month.

BEI president Budi Mulya said last month the government would be able to put the bank into operation in early August.

The government injected Rp 3 trillion (about US$428.5 million) into BEI as initial paid-up capital following the bank's establishment in May.

Mukhlis said the commencement of BEI's operations now awaited the signing of agreements by parties involved in BEI.

Mukhlis said these parties were BEI, the 15 foreign banks and domestic banks which were expected to extend loans guaranteed by BEI to exporters.

A set of standard agreements will be drawn up to govern BEI's financing of domestic exporters, Mukhlis said. (udi)