Harawi's move to take over Bank Papan put on hold

JAKARTA (JP): Bank Indonesia has not approved the recent move by the Harawi Sekawan Group to take over a majority stake in publicly listed Bank Papan Sejahtera.

The director of the central bank, Subarjo Joyosumarto, said on Sunday evening that the green light had not been given to the Harawi Group because of certain considerations.

"There was something which was not transparent and not feasible behind this deal," Subarjo was quoted by Antara as saying.

He also mentioned the uncertainty of where the group would obtain the funds needed to take over the bank.

A source, requesting anonymity, told The Jakarta Post that BI's failure to approve the move may have been because of the Suryajaya family's involvement in Harawi's transaction.

The Suryajaya family are the former owners of the now defunct Bank Summa. Under existing banking laws, the family is not eligible to own a bank in Indonesia because of its past record in the banking industry.

The Harawi Sekawan Group is a business unit of the country's largest Muslim organization, Nahdlatul Ulama.

According to Bank Papan's corporate secretary, the Harawi Group purchased a 19.98 percent stake in Bank Papan from two institutional foreign investors in December 1998.

The deal, which made the Harawi Group the bank's majority shareholder, was registered with the Capital Market Supervisory Agency (Bapepam) on Jan. 12, 1999, he said.

The other shareholders in Bank Papan are PT Tunasmas Paduarta with 19.84 percent; Chase Manhattan-Singapore which holds 12.07 percent; Asuransi Jiwa Bersama Bumiputra with 6.8 percent; PT REI Sewindu with 6.48 percent; Bank Indonesia which holds 5.76 percent; PT Asuransi Jiwasraya with 5.69 percent; the remaining 23.37 percent is publicly held. (02)