Business sentiment in RI weakens

Business sentiment in RI weakens

JAKARTA: Danareksa Research Institute said investor confidence in
Indonesia fell during February and March due to uncertainty at
home and abroad.

In its latest survey, on Monday, Danareksa said that the
confidence index during the period fell 1.4 percent.

It also said that confidence in the government dropped as the
operating conditions for businesses worsened.

It added that many businessmen continue to feel that law
enforcement in the country remains weak.

The institute said that under such unfavorable conditions
business appeared riskier, and that this encouraged business
operators to put off expansion plans. -- JP

;Agencies;
ANPAf..r..
Moneymatter-House-Hartadi-election
House approves Hartadi's election
JP/16/money

House approves Hartadi's election

JAKARTA: The House of Representatives formally appointed on
Tuesday Hartadi A. Sarwono as a new deputy governor of Bank
Indonesia, replacing Miranda S. Goeltom.

The appointment was made during a plenary session. Hartadi now
must wait for the Supreme Court's stamp of approval before
officially taking up the post.

House Commission IX for financial affairs elected Hartadi,
currently the central bank's chief representative to Tokyo, on
May 19. He beat out two other candidates, Bambang Sindu Wahyudi
and Siti C. Fadjriah, for the post.

Hartadi will hold the new job for a five-year term, filling a
post that has been vacant since May 17, when Miranda's term
ended. -- JP

;Agencies;
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Moneymatter-SKorean-banks
South Korean banks' NPL soar
JP/16/money

South Korean banks' NPL soar

SEOUL: South Korean banks face mounting non-performing loans
(NPL), reflecting the financial crunch faced by both individuals
and businesses amid the ongoing economic slowdown, the financial
watchdog said on Tuesday.

Non-performing loans held by the country's 19 banks stood at a
total of 18.73 trillion won (US$15.6 billion) at the end of
March, up an alarming 24 percent from the end of December, the
Financial Supervisory Service (FSS) said.

Non-performing loans are loans whose interest payment have
been in arrears for three months or longer.

The ratio of non-performing loans against all loans
subsequently rose 0.4 percentage points to 2.7 percent during the
three-month period.

The rapid increase was attributable to snowballing household
debts in arrears, most of them credit card loans, and surging
corporate failure to service debts, FSS said. -- AFP

;Agencies;
ANPAf..r..
Moneymatter-Euro-zone-surplus
Euro-zone surplus narrows in March
JP/16/money

Euro-zone surplus narrows in March

FRANKFURT, Germany: The euro zone had a current account
surplus of 1.2 billion euro (US$1.4 billion) in March, smaller
than the surplus of 7.4 billion euro recorded a year earlier,
data published by the European Central Bank (ECB) on Tuesday
showed.

The ECB attributed the decline to a sharp decline in the goods
surplus, "which was only partially offset by a lower deficit for
current transfers and a by a shift of the balance for services
from a deficit to a surplus."

In the financial account, combined direct and portfolio
investment in the euro area recorded net inflows of 12.7 billion
euro in March, compared with outflows of 1.7 billion euro a year
earlier, the ECB added.

The surplus in the euro zone contrasts with a heavy deficit in
the United States, which economists say is one reason why the
dollar has fallen and the euro has risen. -- AFP

;Agencies;
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Moneymatter-ECB-pave-way-rate
ECB to pave way for possible rate cut
JP/16/money

ECB to pave way for possible rate cut

FRANKFURT, Germany: The European Central Bank (ECB) appeared
to prepare the ground for a possible cut in interest rates late
on Monday, with the bank's deputy president Lucas Papademos
pointing to slowing inflation and very sluggish economic activity
in the single currency area.

"Favorable conditions have been established for a further
decline in inflation... and recent developments seem to confirm
this favourable trend," Papademos told journalists at a dinner
here in comments released for publication on Tuesday.

Although the ECB is facing increasing calls from euro-zone
governments, worried over their ailing economies and a euro at
historic highs, to slash borrowing rates, the guardian of the
euro has always argued its main task is to keep a lid on
inflation rather than take active measures to boost growth and
employment.

Nevertheless, Papademos appeared on Monday to be opening the
door for a possible rate cut, even as soon as the next week when
the ECB's governing council holds its next policy-setting
meeting. The bank has held its central "refi" refinancing rate at
2.50 percent since March. -- AFP