Sat, 16 Apr 2005

Govt to pay another Rp 176.6b to Bank Global depositors

The Jakarta Post, Jakarta

The Ministry of Finance has verified 3,997 savings accounts owned by depositors of the now defunct Bank Global and will pay Rp 151.13 billion (US$15.9 million) in 2,196 of the accounts next week under the government's deposit blanket guarantee scheme.

A total of Rp 25.26 billion in 66 non-savings accounts -- which includes interbank loans and safe deposit boxes -- will also be covered by another Rp 615.58 billion in 1,888 savings and non-savings accounts pending further verification.

But 14 savings accounts worth Rp 21.32 billion will be scrapped from the list, as the Finance and Development Comptroller (BPKP) and the ministry's blanket guarantee implementation unit (UP3) found them to be linked with the owners and management of Bank Global.

Another 27 non-savings accounts worth Rp 406.67 billion -- including Bank Global's sub-debt bonds and mutual funds -- will not be covered as they are not included in the guarantee program.

"Depositors can receive payments for their guaranteed accounts starting April 21 at appointed banks," Director General for Financial Institutions Darmin Nasution said on Friday during the announcement on the account verification results.

"Other depositors who have yet to submit their claims to the payment banks are advised to do so by Nov. 22 at the latest, or two months following the end of the government's blanket guarantee program."

BPKP and UP3 had received data of 9,872 accounts worth Rp 1.25 trillion from Bank Global's management for verification.

In its two previous verifications, the ministry said it would guarantee 2,398 accounts worth Rp 500.2 billion and as of April 7 had paid Rp 488.14 billion in 634 of the accounts through the payment bank, Bank BNI.

Darmin explained the ministry still had to verify another 1,888 accounts as Bank Global's unscrupulous management had used them for "overdrafting" -- numerous fund transfers from one account to another ending at a fictitious account.

"These overdraft transactions have to be carefully traced and clarified," he said. "The process is more difficult as the bank's database had been somehow jammed. We have so far only succeeded in retrieving data from February last year."

Bank Global depositors -- who attended the announcement and whose accounts are yet to be verified -- questioned Darmin when they would be compensated, several of them arguing they urgently needed their funds.

"The results of the next verification will be announced in May and we will try to cover all of the accounts," he said. "If possible, we will also try make the payments quicker and easier."

Bank Indonesia officially closed Bank Global on Jan. 13, due to failing capital and overt evidence of banking fraud. Last year, the central bank also closed Bank Dagang Bali and Bank Asiatic for similar reasons.