Central bank to seek deadline for BCA sale
Berni K. Moestafa, The Jakarta Post, Jakarta
As confusion still reigns over the timing of Bank Central Asia (BCA) sale, Bank Indonesia said it would seek a deadline from the government if uncertainty lingered up to Friday next week.
Bank Indonesia Governor Sjahril Sabirin said the Indonesian Bank Restructuring Agency (IBRA) had one week as of Friday to submit documents for bidders to pass its fit-and-proper test.
Only after the documents had been collected, he said, could Bank Indonesia proceed with examining final bidders for the BCA shares.
The tests on them might take up to 30 days, but would likely be less, he added.
Asked what he would do after the one week had passed, he said: "We're going to discuss that with IBRA (and) when it expects to complete (the BCA sale)."
He refused to say how many bidders had yet to complete their documents, and what types of documents they were.
Sources close to the sale process said that all four final bidders submitted incomplete documents.
Among the bidders are two foreign led consortia -- one led by U.S. investment firm Farralon Capital and the other by the British-based Standard Chartered Bank Plc.
After nearly two years, BCA's sale process has entered the last stage with the submission of the final bids last Monday.
But even at this stage, it remains unclear when IBRA plans to close the deal for a 51 percent stake in BCA.
IBRA argued it was waiting for Bank Indonesia to complete its fit-and-proper test, but Sjahril pointed out that it was IBRA's call.
"The one selling the shares is IBRA. Bank Indonesia is only helping to examine the bidders' shareholders," he said.
For its fit-and-proper tests, Bank Indonesia has 17 requirements, five of which are mandatory to win the bid.
Among the five key documents is one that identifies the "ultimate shareholders" of the final bidders for BCA.
The central bank bars local banks from funding the acquisition, including people on its blacklist for bank owners.
BCA's former owner, the Salim Group, misused some Rp 52 trillion (about US$5 billion) in state funded bailout loans in the wake of the 1997 financial crisis. Salim has since been blacklisted from BCA.
But the unclear timing of the sale and suspicion that Salim may be hiding among the bidders have done little to hurt the credibility of the sale process.
Foreign investors were said to be closely watching the sale process of BCA, deemed as one of IBRA's best assets.
The sale of the BCA shares is also part of reform targets set out under a lending agreement with the International Monetary Fund (IMF).
A delay in the sale of BCA shares in late 2000 prompted the IMF to protest, which contributed to an eight-month suspension of its loan program. As yet there have been no complaints from the IMF this time around.