Employees protest planned sale of BCA

Employees protest planned sale of BCA

Berni K. Moestafa, The Jakarta Post, Jakarta

Hundreds of employees from Bank Central Asia (BCA)
demonstrated on Thursday against the planned sale of BCA,
stirring up familiar concerns of mob politics blocking crucial
privatization and asset sales programs.

Rallying inside the House of Representatives complex ,the
employees demanded the government to cancel the sale of BCA,
Antara reported.

"We're concerned that once it is sold, there'll be mass
layoffs," said Bilal, a spokesman for the bank's labor union.

One banner read "don't let BCA fall into foreign hands",
another read "we're victims of privatization", "where will BCA
privatization proceeds go to?"

Bilal said the protest involved BCA employees from various
branch offices here and from East Java.

It was not immediately clear whether the employees' protests
were entirely aimed against foreign ownership, or whether they
preferred the bank to remain under state control.

Bilal added that they also rejected the Salim Group from
regaining control of the bank.

The Salim group, which founded the bank, was forced out of BCA
after mismanagement led to the release of billions of U.S.
dollars in bail out funds to save BCA from collapsing in the late
90s.

As a result, the government took over the bank and banned
Salim from reclaiming it.

Although Salim is not among the four final bidders, some
experts have raised suspicions that they are using one of the two
local consortiums as a well-disguised front to buy the bank.

To recoup some of the bail out funds, the government plans to
sell a 51 percent stake in the bank.

In charge of the sale is the Indonesian Bank Restructuring
Agency (IBRA), which is now in the final stage.

Four final bidders have emerged, two of them foreign.

They are the British-based Standard Chartered Bank Plc and the
U.S. investment firm Farallon Management Capital.

Both companies have publicly announced that they had no plans
for massive layoffs, and that they intended to keep BCA as it
was.

The BCA protest is hauntingly reminiscent of last year's
failed effort to sell state cement producer PT Semen Gresik to
Mexico's Cemex SA de CV.

Employees at Semen Gresik and its two units, Semen Padang and
Semen Tonasa, successfully blocked a government option to sell
a 51 percent stake in the company to Cemex.

Backed by local politicians, they rejected foreign control and
threatened to go on strike if the government went ahead with the
option.

The government still hopes to sell Semen Gresik, but will
avoid the issue for the time being due to fears of a backlash
from employees.

Analysts called this mob politics, suspecting that certain
groups instigated such protests to protect their interests in the
state-owned enterprises.

It remains to be seen though whether the late protest by BCA
employees could gather enough steam to seriously hinder the sale.

So far IBRA has set no timetable for the finalization of the
sale.

Uncertainties linger even after the final bids for BCA have
been submitted.

IBRA argued it could not process the bids as Bank Indonesia
had yet to finalize its assessment of the bidders.

Passing Bank Indonesia's assessment is mandatory for owning
BCA, which once was the country's largest privately owned retail
bank.

None of the four bidders have submitted the necessary
documents for the assessment yet.

"I have called on the bidders to quickly submit all required
documents," IBRA chairman I Putu Gede Ary Suta said after a
meeting with the Business Competition Supervisory Commission.

He said he would decide with the central bank the best timing
for a deadline, by which bidders must submit their documents.