Excessive interest rate

Excessive interest rate

Bank Internasional Indonesia (BII) increased interest on its
loans from 19 percent to 30 percent under the housing loan (KPR)
scheme. It has now further increased the rate to 50 percent.

This has aggravated its customers' problems in the current
economic crisis. It shows BII's arrogance and tyranny in fixing
an arbitrary rate. The bank seems to equate itself to the VOC
(the Dutch trading company that held a monopoly in Indonesia from
1602 to 1799) which unrelentingly drained the country's
resources. BII forgets that when it was in a dither with
liquidity problems, due to mismanagement, it was saved by
liquidity credits from Bank Indonesia to the tune of Rp 750
billion, which belonged to the people (see Forum magazine's
special edition in December, 1997). Moody's, an international
rating agency, reported on Jan. 27, 1998 the downgrading of BII
from D to E.

We, the undersigned, BII customers under the KPR scheme,
appeal to fellow customers everywhere to unite and jointly
confront BII's arrogance by, among other things, postponing
payment of installments until the bank is willing to listen to
its customers and fix a reasonable rate of interest and hold
negotiations in a professional way.

A request is also directed to the state minister of public
housing and settlement, the Indonesian Bank Restructuring Agency,
banking and legal experts, to contribute their thoughts in order
to spare us the despotism of BII which intends to entirely drain
our reserves.

We do want to pay our installments, but the bank should not
raise its interest rates at will in such a way as to erode our
financial capacity, which continues to decline in the current
situation that nobody could predict.

A special question to legal experts: Can a loan agreement, the
contents of which oppress one side (the debtor) and benefit the
other side (BII), be revised into a just and civilized one?

DINDIN M.M. and friends

Jakarta