Eight more debtors get debt reprieve
Dadan Wijaksana, The Jakarta Post, Jakarta
The government has agreed to forgive the debt of eight former bank owners to the tune of US$70 million, which could protect them against criminal charges in the future, despite the fact that the taxpayers have failed to recoup the bailout funds provided to them.
The decision was made on Wednesday by the Financial Sector Policy Committee (FSPC), a powerful grouping of senior economic ministers, based on recommendations from the Indonesian Bank Restructuring Agency (IBRA).
IBRA will officially give the eight ex-bankers letters attesting to their debt-free status.
"It's up to IBRA when it will issue those letters," FSPC secretary Lukita D. Tuwo announced on Wednesday after their meeting.
The debtors are Hashim S. Djojohadikusumo, Njoo Kok Kiong, Honggo Wendratmo, Suparno Adijanto, Andy Hartawan, Ganda Eka Handria, Philip S. Widjaja and Mulyanto Tanaga who have a combined debt of more than Rp 600 billion (over US$70 million)
The first three are the former owners of Bank Papan Sejahtera with a combined debt of Rp 433 billion. The others are the former owners of small banks Bumi Raya Utama, Baja Internasional, Sembada Arthanugraha, Mashill and Indotrade.
They will add to the already long list of debtors who have been declared "cooperative" and given the debt-free status.
While currently only Sudwikatmono and The Nin King, who had officially been granted the debt-free status, four others (Hendra Liem, Ibrahim Risjad, Siti Hardijanti Rukmana and Anthony Salim) are expected to follow soon as all have been deemed as cooperative by IBRA.
Of the six, only Siti Hardijanti who is yet to secure FSPC's approval, pending further verification on the assets she had surrendered to IBRA.
Anthony Salim was the former owner of Bank Central Asia, Siti H. Rukmana (Bank Yama), Liem (Bank Bumi Internasional), The Nin King (Bank Dana Utama), Ibrahim (Bank Risjad Salim) and Sudwikatmono (Bank Surya and Subentra).
All are among 39 bank owners who received Rp 144.5 trillion in bail-out funds from the government during the crisis. Most of them were later accused of having misused much of the funds by channeling the money into affiliated businesses -- considered a crime under the banking law.
To avoid criminal indictment, they signed a debt settlement scheme with IBRA, allowing them to settle debts via cash and assets. But, as it later turned out, the assets produced insufficient proceeds for the state, leaving the cash-strapped state budget to bear the burden of the shortage and passing it on to taxpayers.
IBRA has said the recovery rate of those assets was less than 30 percent.
Meanwhile, IBRA has also set a two-week deadline for 11 APU debtors to top up the shortfalls of their debt repayments, or risk being labeled uncooperative and face litigation.
The warning was handed out directly to the former bankers during a meeting with IBRA, said Taufik Ma'roef, the agency's deputy chairman.
IBRA was set up in 1998 and is scheduled for termination on Feb. 27.
11 debtors told to cover debt shortfall ----------------------------------------------------- Debtors Bank Debt
(Rp) ----------------------------------------------------- Nirwan D. Bakrie BNN 3.4 trillion Marimutu Sinivasan Putera Multikarsa 1.3 trillion The The Min Hastin 134 billion Husodo A. Sewu 209 billion Adisaputra J. Namura Yasonta 410 billion The Nin Kong Baja 45 billion Atang Latief Bira 325 billion Omar Putihrai Tamara 190 billion Lidia Muchtar Tamara 202 billion Iwan Suhardiman Tamara 35 billion Ulung Bursa Lautan Berlian 615 billion ----------------------------------------------------- Source: The Jakarta Post's files