First test for BCA bidders to finish within a month: IBRA

The Jakarta Post, Jakarta

The Indonesian Bank Restructuring Agency (IBRA) said on Wednesday it expected to conclude the first of the two-stage tests on the final bidders for Bank Central Asia (BCA) in less than a month.

However, IBRA chairman I Putu Gede Ary Suta was still in the dark as to when a winner would be announced, as some bidders had yet to pass separate tests conducted by Bank Indonesia.

"IBRA wants to finish the drop dead test as soon as possible," he told reporters after a meeting with senior economic ministers.

The so-called drop dead test is the first of two tests where bidders must meet all IBRA requirements, or be ejected from the competition.

In the second test, the bidders' reputations, their plans for BCA, and, most of all, their offer prices will be used to determine the winner.

Asked whether the first test could be concluded within a month, Ary Suta responded,"We're expecting it to be sooner than that."

Four of the original nine bidders submitted their final bids last Monday, opening the door to the last stage in the almost two-year effort to return BCA to private ownership.

The four bidders who submitted their bids on Monday were the British based Standard Chartered Bank Plc. consortium, the Bank Mega consortium, the Farallon Capital consortium, and the GKBI consortium.

IBRA had reportedly planned to announce a winner two weeks after Monday's deadline for the final bids, but must now wait for Bank Indonesia to conclude its tests on some of the bidders.

IBRA has refused to say when it would be able to announce the winner.

Last Monday should also have been the deadline for bidders to have submitted all of the completed documents that Bank Indonesia needed for the test.

"Several bidders haven't submitted their documents. We expect them to complete the documents soon," said Bank Indonesia Governor Sjahril Sabirin.

State Minister for State Enterprises Laksamana Sukardi made reference to one of the slow bidders, saying that last minute changes in the Standard Chartered consortium was impeding Bank Indonesia's work.

The British bank was short of bidding partners just three weeks before Monday's final bid deadline.

In its release announcing the final bidders, IBRA said that Standard Chartered was planning a consortium with the Government of Singapore Corp. Pte. Ltd, Prudential Plc and PT Berca Indonesia.

Some say that the government is leaning in favor of Standard Chartered, which in 1999 was forced out of a deal to acquire Bank Bali after a politically linked scandal erupted in the bank.

The announcement of the four final bidders has earned the government praise from analysts, and has helped allay suspicions that BCA's former owner, the Salim Group, may still be among them.

The group is banned from buying back BCA after mismanagement led to a bail-out by the state worth billions of U.S. dollars.

A Bank Indonesia release on Wednesday said bidders must present documents that, among other things, identified the sources of funding for BCA's acquisition.

Governor Sjahril added that some bidders had yet to sign the so-called comfort letters -- promises to provide shore-up capital for BCA should the bank suffer from a liquidity shortage.

Often mistakenly called a fit and proper test, Bank Indonesia said its administrative selection and interviews should take no longer than 30 days to complete.

Sjahril suggested that the central bank and IBRA had agreed on a deadline for the completion of these tests.

But Ary Suta and Laksamana threw the ball back into Bank Indonesia's court, saying they would wait for the central bank's tests to be completed.