BII Finance wins appeal

JAKARTA (JP): The Supreme Court has upheld the Commercial Court's decision to reject a US$65 million bankruptcy petition filed by three foreign banks against local finance company PT BII Finance Center.

According to a court verdict document issued on Monday the Supreme Court agreed that BII Finance was not obliged to repay its debt to the plaintiffs under the initial payment schedule, because it had signed a debt restructuring agreement with them. .

Bahrain-based Arab Banking Corporation, Credit Agricole Indosuez of France and Seoul-based Asian Banking Corporation have arranged three syndicated bank loans totaling $65.3 million for BII Finance.

The banks jointly filed a bankruptcy claim against BII Finance to the commercial court in July this year after the latter refused to repay the loans that matured between Oct. 1998 and Jan. 1999.

BII, which is a subsidiary of publicly listed Bank Internasional Indonesia, claimed that it had signed a debt restructuring agreement with the banks in April this year, but the banks denied the agreement.

The commercial court ruled in favor of BII Finance in August this year. The three banks then appealed to the Supreme Court. (udi)