Chase will accept Indonesian L/Cs

Chase will accept Indonesian L/Cs

JAKARTA (JP): The Indonesian Exporters Association (GPEI) said
Thursday it had received firm commitment from the New York-based
Chase Manhattan Bank to facilitate overseas transactions.

GPEI secretary-general Johannes L. Sitanggang said the
assistance would include the bank's acceptance of letters of
credit from Indonesian banks to settle payments for imported raw
materials.

He said, however, that Chase Manhattan for the time being
would only confirm L/Cs issued by state banks Bank Negara
Indonesia (BNI), Bank Rakyat Indonesia (BRI), Bank Dagang Negara
(BDN), Bank Bumi Daya (BBD) and Bank Pembangunan Indonesia
(Bapindo), and private Bank Duta and Bank Lippo.

Under the agreement, he said, Chase Manhattan would accept 90-
day usance L/Cs at present, and would consider accepting 180-day
and 360-day usance L/Cs in the future.

The agreement was reached during a meeting between GPEI
executive's and Astar Sale, Chase Manhattan's vice president for
trade finance, and Anup Kuruvila, vice president of Asia trade
finance in the bank's headquarters in New York early this month,
he said.

Plunging confidence in the country's troubled banking sector
has prompted international banks to reject local L/Cs. This has
prevented firms from getting components essential for products to
be manufactured for export.

Many foreign banks also no longer accept usance L/Cs from
Indonesian importers and only accept a sight L/Cs.

Before the crisis, Indonesian importers normally opened a
usance LC, which did not require such a large amount of cash up
front.

Sitanggang said exporters facing such barriers could contact
the Chase Manhattan Bank in New York and its branch in Jakarta
directly or through GPEI. (gis)