City hall asked not to help Bank DKI
City hall asked not to help Bank DKI
JAKARTA (JP): A non-governmental organization, the Jakarta
Government Watch (JGW), urged the city administration on Monday
to review a planned capital injection of Rp 80 billion (US$8.9
million) for city-owned Bank DKI before taking any stern actions
against the bank's bad debtors.
"Sutiyoso should postpone the injection of the additional
capital until firm measures are imposed on the bad debtors," JGW
chairman Amir Hamzah said.
Without disclosing the amount of the bad debts, Amir argued
that the loan disbursements to debtors were full of nuances of
corruption and collusion.
He said most of the bank's debtors received the loans without
pledging sufficient collateral since they were backed by
unscrupulous city officials.
Based on an investigation conducted by the JGW, one of the
debtors owed the bank more than Rp 100 billion for a loan it
received in 1997 to build a hotel here.
"If the administration succeeds in pushing the debtor to pay
his loan, then it will not need to inject more capital into the
bank," Amir said. He would not disclose the name of the hotel.
He further said that the hotel owner had suffered losses and
could not repay the loan because he was inexperienced at managing
hotels.
He revealed that JGW had also found that Bank DKI suffered a
loss of about Rp 19 billion in the purchase of mutual funds
totaling Rp 27 billion in 1997, which are worth about Rp 8
billion.
"Based on the bad loans and the bank's poor performance,
Sutiyoso should review the plan and improve control over bank
management," he said.
Separately, the deputy governor for financial affairs, Fauzie
Alvi Yasin, confirmed on Monday that the administration planned
to add more capital taken from the 2001 city budget for bank
recapitalization.
"It will be carried out by the end of this year at the
latest," Fauzie said at City Hall.
He claimed the injection of Rp 80 billion, which would raise
the bank's paid up capital to Rp 500 billion, was allocated in an
effort to help revive the bank, which is under the supervision of
the Indonesian Banking Restructuring Agency (IBRA).
Fauzie said the administration had made many efforts to help
improve the bank's performance, including hiring professionals
for the bank to handle its bad debts.
Meanwhile, the administration assistant for development
affairs, Ongky Sukasah, said that some debtors had not returned
their loans.
"Of course, we have some unpaid loans. Some of them are
'delinquent debtors'," he said, adding that most loans were
disbursed over the past several years. (jun)