Govt slaps travel ban on officials of ailing banks

SEMARANG (JP): Minister of Justice Muladi has announced an overseas travel ban on 50 executives and owners of 14 troubled banks recently suspended or taken over by the government.

Muladi said here Saturday the travel ban was made effective for 30 days as of April 4, when the Indonesian Bank Restructuring Agency (IBRA) suspended the operation of seven insolvent banks and assumed the management of seven other problem banks.

He said the measure, imposed to allow the authorities to question the executives on the state of their institutions, could be extended for another six months should the need arise.

"The Ministry of Justice imposed the ban after close coordination with the Ministry of Finance and the National Police," Muladi told the media here.

The minister said the travel ban was also to prevent any possibility of the individuals leaving the country with public funds.

"I am not accusing them of having committed crimes... However, I don't rule out the possibility that this matter could lead to a criminal investigation," he said.

The suspended banks are Bank Surya and Bank Subentra, controlled by President Soeharto's cousin Sudwikatmono, Bank Kredit Asia and Bank Pelita, controlled by Hashim Djojohadikusumo, Bank Centris by Andri Tedjadharma, Deka Bank by Dewanto Kurniawan and Bank Hokindo by the Hokianto family.

IBRA said its criteria for freezing the operations of the banks was if government liquidity credits were equivalent to both more than five times the banks' total equity, and 75 percent or more of their total assets.

Banks which had their management placed under IBRA are Bank Umum Nasional, controlled by Minister of Industry and Trade Mohamad "Bob" Hasan, Bank PDFCI, controlled by PT Bahana Investa Argha, Bank BDNI by businessman Sjamsul Nursalim, Bank Danamon by Usman Atmadjaja, Modern Bank by Samadikun Hartono and Bank Tiara Asia by the Ometraco Group and the state Bank Ekspor Impor Indonesia.

The IBRA move was part of government efforts to strengthen the ailing national banking sector.

The 14 banks are part of 54 problem banks which have been put under IBRA supervision after they received liquidity credits from Bank Indonesia equivalent to more than 200 percent of their capital, or had capital less than 5 percent of their assets.

The spokesman for Hashim Djojohadikusumo's Tirtamas Group, Jannus O. Hutapea, said in a statement here yesterday that the shareholders of Bank Pelita and Bank Kredit Asia would remain in the country and cooperate fully with the government.

Bank Pelita president Agus Anwar and Bank Kredit Asia president Syafril Nur were quoted by Jannus as saying that they would comply with the rules and cooperate completely with the authorities or IBRA in settling any outstanding issues on the banks' assets.

They said they were working with IBRA in discharging their employees. Bank Pelita employs about 500 people and Bank Kredit Asia has 80 staff.

The Tirtamas Group initially planned to merge the two banks with Bank Papan Sejahtera, also controlled by Hashim, Jannus said, but the plan was canceled.

Meanwhile, Bank Internasional Indonesia (BII) announced Saturday that its planned merger with four other local banks had been canceled.

BII said in a statement that the merger with Bank Dagang Nasional Indonesia (BDNI), Bank Tiara Asia, Bank Dewa Rutji and Bank Sahid Gadjah Perkasa was called off because the management of BDNI and Tiara Asia were now under IBRA. (har/rid)