Former minister testifies in Bank Bali trial

Former minister testifies in Bank Bali trial

JAKARTA (JP): Former Minister of Finance Bambang Subianto, who
was also chairman of the Indonesian Bank Restructuring Agency
(IBRA), testified on Wednesday that Rudy Ramli, when he was
president of Bank Bali, had complained about the difficulties to
obtain IBRA funding to cover a loan BDNI Bank owed Bank Bali.

But Bambang said he was not aware about the disbursement of
the agency's funds to the bank.

"Rudy Ramli met with me and complained about BDNI's bad debt,"
Bambang told the Central Jakarta District Court, which is trying
Bank Indonesia Governor Syahril Sabirin on charges of corruption.

"But I said that the funds could not be disbursed because it
(the situation) did not comply with a joint agreement between
IBRA and Bank Indonesia directors," he was quoted by Antara as
saying.

The agreement document defined the rights and obligations of
liquidated banks, and included criteria regarding inter-bank debt
assistance.

Bank Bali's claim could not be approved because it did not
fulfill the requirements stipulated in the agreement, the witness
said.

Syahril is being tried for his alleged role in the
disbursement of Rp 904 billion (US$96.2 million) of IBRA funds to
Bank Bali. According to the indictment, the defendant had ordered
one of his directors, Erman Munzir, between February 1999 and
June 1999, to disburse the money to Bank Bali.

Rp 546 billion (US$58.8 million) of the disbursed funds was
paid to factoring firm PT Era Giat Prima as a "commission" for
helping Bank Bali reclaim interbank loans owed by several closed-
down and taken-over banks. It was not necessary for Bank Bali to
use a third party to recoup interbank loans as the claims were
guaranteed by the government.

Bambang said that disbursement of the loan owed by Bank BDNI
to Bank Bali was based on a recommendation by then IBRA chairman
Glenn M. Yusuf.

Bambang was the first chairman of IBRA, which was established
by former president Soeharto in late January 1998. After only two
months in the position he was replaced by Iwan R. Prawiranata,
who survived for approximately three months. The third chairman,
Glenn M. Yusuf, served for a turbulent 18 months, while Cacuk
Sudarijanto, appointed in December 1999, was replaced by Edwin
Gerungan in November last year.

The court also heard the testimony of a former director of
Bank Bali, Firman Sutjahja, while Rudy Ramli failed to appear at
the hearing due to illness.

Pande Nasorahona Lubis, a former deputy chairman of IBRA, and
one the owners of Era Giat Prima, Djoko S. Tjandra, were tried
last year for their alleged involvement in the Bank Bali scandal.
Both were acquitted of all charges by the same district court.

Erman Munzir will be tried separately.

The case attracted public attention after it was revealed that
EGP was owned by people closely connected with a small group in
the Golkar Party responsible for the reelection campaign of then
president B.J. Habibie, who lost the position in October 1999.
(sim)