Dragon Bank warned

Dragon Bank warned

JAKARTA (JP): The government will take measures against the
representative office of Dragon Bank International Ltd. of
Vanuatu if the bank is found to be engaging in commercial banking
activities here.

"It is illegal for any representative office of a foreign bank
to perform such activities here," State Minister of Investment
Sanyoto Sastrowardoyo said yesterday in response to a press
report that the Dragon Bank's representative office in Jakarta
was working towards commercial operations.

Bisnis Indonesia reported last week that the Dragon Bank's
representative office had offered arrangements of syndicated
loans to a number of local customers, including banks.

Paul Soetopo Tjokronegoro, a director of Bank Indonesia (the
central bank), was quoted by the daily as saying that his party
was investigating the activities of the Dragon Bank's
representative office.

Paul said that if a foreign bank representative office wants
to engage in liaison or promotional activities in Indonesia, it
has firstly to acquire a license from the Minister of Finance.
Such licenses are obtainable only with a recommendation letter
from the central bank.

However, the license from the investment minister does not
permit a foreign bank to engage in commercial activities in
Indonesia.

"Our office does not issue any licenses for foreign banks to
engage in commercial operations here. We give licenses to foreign
banks' representative offices to carry on promotional activities
only," Sanyoto said. (rid)