Ex-owner of Bank Surya, government reach deal

JAKARTA (JP): The country's financial authorities have signed a deal with the former owner of closed down Bank Surya to return Bank Indonesia's liquidity support, chairman of the Indonesian Bank Restructuring Agency (IBRA) Glenn S. Yusuf said late on Monday.

"We will announce it tomorrow," he told the media a few minutes before a debate at the House of Representatives on the government-proposed banking bill which would provide IBRA with legal power to restructure the country's ailing banking sector.

Sudwikatmono, former controlling shareholder of Bank Surya, and a cousin of Indonesia's former ruler Soeharto, has to pay some Rp 1.9 trillion (US$172.72 million) in emergency funds provided by the central bank.

Glenn did not explain whether the payment would be made in assets or cash, but an official at the agency said that it would be a combination of both.

Bank Surya was suspended by the government in April after receiving large amounts of Bank Indonesia liquidity support from early this year.

Nine other banks were also suspended in April and August, and four were nationalized last month.

The bank, together with most of the other 13 banks which received massive liquidity support, was found to have also breached the 20 percent legal lending-to-affiliates limit, prompting the government to force the ex-owners to repay the loan by the midnight on Sept. 21 deadline.

Sudwikatmono, however, failed to meet the deadline, but managed to organize last-minute negotiations with the authorities to avoid criminal proceedings.

Timber tycoon Mohammad "Bob" Hasan, co-owner of suspended Bank Umum Nasional, and property mogul Usman Admadjaja, former owner of nationalized Bank Danamon, along with owners of the other nine banks also failed to meet the Sept. 21 deadline.

Asked whether Bob Hasan and Usman Admadjaja had surrendered enough assets to cover their loans, Glenn said: "They have waived some assets, but we are still revaluing them."

He added that the tycoons claimed the assets were enough to cover their obligations.

Bank Umum Nasional received more than Rp 6.8 trillion in liquidity support, while Bank Danamon got Rp 25.8 trillion.

The Salim Group and the Gadjah Tunggal Group, two of the country's largest conglomerates, were among those which managed to make payments on their loans, totaling Rp 78 trillion, on time.

The Salim family handed over some 100 companies to repay Rp 48 trillion in obligations, including some Rp 13 trillion to recover Bank BCA's intra-group lending.

Bank Indonesia has provided liquidity support since January to help banks hit by runs by panicked depositors to prevent a more widespread collapse of the industry. (rei)