Fri, 18 Aug 2000

House alerts IBRA over revenue target

JAKARTA (JP): The House of Representatives budget committee called on the Indonesian Bank Restructuring Agency (IBRA) on Wednesday to speed up its asset disposal program to raise some Rp 11.4 trillion (US$1.37 billion) in cash over the next three months.

Head of the committee Abdullah Zaini said on Wednesday that out of the Rp 18.9 trillion targeted by IBRA this year, only some Rp 7.5 trillion had been collected.

"We have warned IBRA to work harder to meet the target because it only has until November," Abdullah said following a closed- door meeting between House senior legislators and IBRA top officials.

The meeting was held to seek a resolution to the controversial Master of Settlement and Acquisition Agreements (MSAA) signed by the previous administration with several bank owners to repay their debts to the government.

Abdullah said that if IBRA failed to meet its revenue targets, there would be consequences for the current 2000 state budget, including delays to certain government projects.

He said that the government would meet with the House to discuss any possible changes to the current state budget before the budget year ends at the end of December.

IBRA is mandated to raise the Rp 18.9 trillion target to help finance the state budget, which is been heavily burdened by huge bank recapitalization costs.

IBRA chairman Cacuk Sudarijanto confirmed that the agency had so far only raised Rp 7.5 trillion since the budget year started in April.

He expressed confidence that the agency would be able to meet its target.

He said that IBRA and the finance ministry would meet with the House late this month to seek approval for plans to sell its ownership in the publicly listed Bank Central Asia (BCA) and Bank Niaga this year.

Cacuk said the agency would propose to sell more than a 50 percent stake in the two banks.

"We have to sell a majority stake in order to get a premium price," he said.

IBRA earlier said it intended to raise some Rp 1.9 trillion from the sale of the two banks.

The agency has also said that it plans to sell its ownership in dozen of companies in the remaining period of this year.

The companies were part of various assets surrendered by former bank owners to repay their debts to the government.

The previous administration of president B.J. Habibie signed MSAA agreements with former owners of five banks in 1998 and 1999. Under the agreement, the bank owners surrender their assets to repay their debts.

But the current government has said it wants to revise the MSAA agreement because it only benefited the former bank owners at the expense of the state.

The House has formed a team to study the MSAA agreements. The team will decide on whether to support the government plans or not.

Asked if the controversy surrounding the MSAA agreement would inhibit IBRA's asset disposal program, Cacuk said: "God willing, the MSAA case will not affect IBRA's target."

He said that the MSAA agreement was signed with the former owners of Bank BCA, Bank BDNI, Bank Umum Nasional, Bank Risjad Salim and Bank Surya.

He said that only the former owner of BCA, the Salim Group, had completed the terms of the MSAA deal by surrendering the assets. (rei)