Govt to pay some of Asiatic, BDB depositors

Govt to pay some of Asiatic, BDB depositors

The Jakarta Post, Jakarta

The government has decided to pay initial compensation of only
Rp 250 billion (US$29.4 million) to 124,000 depositors of
recently dissolved Bank Asiatic and Bank Dagang Bali (BDB), a
finance ministry official said.

Director general for financial institutions Darmin Nasution
announced on Friday that the decision was made because the
government had only finished verifying the deposits of that
amount covered under its blanket guarantee scheme.

BDB has 408,000 depositors, while Bank Asiatic has 22,000.

The decision was also made to avoid a potential loss of some
Rp 1.1 trillion (US$129 million) in public funds if the
government decided to pay all of the two banks' obligations.

Darmin explained that BDB had up to now handed over assets
worth only Rp 900 billion to the government, and Bank Asiatic
only Rp 300 billion -- totaling only Rp 1.2 trillion.

"Obligations of the two banks, meanwhile, amount to some Rp
2.3 trillion, so there is still a shortage of some Rp 1.1
trillion, which could possibly end up being at the expense of the
state," he said.

Darmin, however, said that the House of Representatives had
approved the government using funds from its 502 reserve account
for the compensation scheme. The government has some Rp 13
trillion in the account.

Compensation payments, Darmin continued, would begin on Monday
as scheduled, and would be conducted by Bank Negara Indonesia
(BNI).

"We will start with depositors owning accounts of up to Rp 2
million," he said. "They can come to any appointed BNI branch
office and show their identity cards to claim their deposits."

Bank Indonesia's (BI) senior deputy governor Anwar Nasution
said that BI would request that the two banks' owners and
shareholders hand over more assets to cover their total
obligations.

"The owners and shareholders of the two banks must surrender
their private assets," Anwar said. "If needs be, we will
confiscate their houses."

Meanwhile, publicly listed Bank Permata and state-owned Bank
Mandiri announced on Friday that they had funds in the dissolved
Bank Asiatic and BDB.

In their reports to the Jakarta Stock Exchange (JSX), Permata
said that it had Rp 10 billion (US$1.17 million) in BDB, while
Mandiri had Rp 18.46 billion in BDB and Rp 13.27 billion in Bank
Asiatic.

Both banks, however, said they were not concerned about the
funds, since the government had pledged to pay up all of the
dissolved banks' obligations to their depositors and other
related third parties.