IBRA asks Sjamsul to settle his Rp 28.5t debt

IBRA asks Sjamsul to settle his Rp 28.5t debt

JAKARTA (JP): The Indonesian Bank Restructuring (IBRA) called
for businessman Sjamsul Nursalim of the Gajah Tunggal Group
conglomerate on Wednesday to be cooperative in settling his
obligation to the agency.

IBRA deputy chairman Mahmuddin Yasin said that the businessman
owed the agency some Rp 28.5 trillion (US$3.31 billion).

"What we ask from Sjamsul Nursalim is his cooperation in
settling his obligation to the government through IBRA,"
Mahmuddin said at a press conference.

He expects Sjamsul to come to the agency at the latest on
Friday to resume negotiation.

Sjamsul's now defunct Bank Dagang Nasional Indonesia (BDNI)
has received some Rp 28.5 trillion in liquidity support from the
government when the economic crisis heightened in 1998.

The businessman has to repay the debt via IBRA, a unit of the
finance ministry.

Mahmuddin said that Sjamsul agreed in September 1998 to settle
his obligation through a combination of cash and transfer of
assets.

He said that Sjamsul, one of the country's richest businessmen
during the era of former president Soeharto, has promised to pay
Rp 1 trillion in cash.

But Mahmuddin said that the agency had so far only received Rp
337 billion.

He said that Sjamsul has argued that his deposits at BDNI
should be enough to cover the remaining cash obligation.

"But this is unacceptable," Mahmuddin said, pointing out that
deposits of affiliated companies were not guaranteed by the
government.

"Sjamsul is required to deposit (additional) cash in the
amount of Rp 663 billion," he said.

The government has guaranteed all deposits in the country's
banking sector to avoid widespread panic in the event the
government shut down a bank. But deposits of companies affiliated
to closed down banks are not included.

Mahmuddin said that Sjamsul had pledged three of his companies
including tire maker PT Gajah Tunggal, integrated shrimp industry
PT Dipasena, and PT GT Petrochemical Industry to repay the
remaining Rp 27.5 trillion of his debt.

"To date, the pledging of the assets to IBRA has not been
fully completed as stipulated in the (September agreement)," he
said.

He also said that the companies scheduled for surrender to
IBRA have depreciated in value.

He said that the reevaluation of the assets is still being
completed.

But he said Sjamsul has promised to surrender his 65 percent
ownership in PT Indonesia Prima Property, and 80 percent interest
in PT Pelsart Resource to cover the decline in the value of the
pledged assets.

One of IBRA's mandates is to make sure that former bank owners
repay their debts to the government, that injected massive
liquidity support to the banks between 1998 and 1999.

The agency has been strongly criticized for its poor
performance in forcing former bank owners to repay their debts.

One of the strongest critics is Coordinating Minister for
Economy, Finance and Industry Kwik Kian Gie, who vowed recently
in a television interview that he would take the uncooperative
former bank owners to court himself if IBRA continued to be
reluctant.

Kwik has also criticized IBRA for accepting assets whose real
values are much smaller that what has been claimed by the owners.
(rei)