IBRA banks to extend Rp 300 billion to SMEs

JAKARTA (JP): Ten commercial banks controlled by the Indonesian Banking Restructuring Agency (IBRA) agreed on Tuesday to extend Rp 300 billion (US$35.3 million) worth of credit to small and medium enterprises.

The loans, under a special government program, carry interest rates of between 16 to 18 percent, compared to 23 percent for ordinary commercial loans.

The loan agreements were signed by the representatives of the banks and the recipients at the office of the State Minister of Cooperatives and SMEs Zarkasih Nur. The state minister, Ibra chairman Cacuk Sudarijanto and the junior minister for national economic restructuring, witnessed the event.

The 10 banks were Bank Central Asia (BCA), Bank Universal, Bank Danamon, Bank Bukopin, Bank Lippo, Bank Niaga, Bank Prima Express, Bank Patriot and Bank Artamedia. They had been taken over by IBRA because of their huge unpaid debts.

Another IBRA-controlled bank, Bank Bali, was not included because it has yet to be recapitalized.

The recipients of the loans were blue jeans producer Aldiani in Jakarta, Mitra Usaha cooperatives (palm oil, Central Kalimantan), Iin Suparni (transportation, Jakarta), PT Sabindo Perdana Transport (trucking, Jakarta), KUD DAU (procurement of dairy cows, Malang, East Java), KUD Rukun Tani Makmur (oil palm plantation, South Kalimantan), PT Meteor Komunikatama (trading, Jakarta), Harya Widjaja (base frame, Jakarta), Firman Gunawan (trading, Jakarta) and S. Anton (food agent, Jakarta).

Cacuk said small and medium enterprises have shown greater resilience during the economic crisis. They need to strengthen their capital structure and managerial capabilities, he said.

Zarkasih said the special loan program has cut the chain of bureaucracy in securing funding for these enterprises.

IBRA said that between January and July, the 10 banks have disbursed Rp 3.94 trillion worth of credit to SMEs, accounting for nearly 20 percent of the total loans disbursed.

BCA and Bank Universal led the way, respectively extending Rp 1.18 trillion and Rp 1.07 trillion during the period. (02)