IBRA can't fulfill govt request for higher proceeds

IBRA can't fulfill govt request for higher proceeds

The Jakarta Post, Sukabumi, West Java

The Indonesian Bank Restructuring Agency (IBRA) said it would
not be able to collect a more money to help finance the 2003
state budget deficit, which will be wider than initially
projected.

IBRA director of finance Harry A.S. Sukadis said on Friday
that the agency could only contribute around Rp 18 trillion
(US$2.17 billion) in cash to the state this year.

The government had asked IBRA to collect more money to help
finance the budget deficit, which is estimated to widen to 2
percent of gross domestic product (GDP) from the initial
projection of 1.8 percent of GDP.

Minister of Finance Boediono expected the agency to contribute
up to Rp 21 trillion to the state this year by converting bonds
the agency redeemed from banks into cash.

In addition to the Rp 18 trillion cash target, IBRA is also
targeted to recover around Rp 8 trillion worth of bonds from
recapitalized banks. The government injected massive amounts of
bonds into troubled banks to help recapitalize them.

"But raising an additional Rp 3.3 trillion by converting bonds
to cash is too difficult for us. And we think the government
would understand," Harry told reporters during a workshop
organized by the agency.

IBRA, which was set up in 1998, took over various assets from
troubled banks and their owners. The agency is mandated to sell
the assets to raise cash to contribute to financing the budget
deficit.

Harry said that according to the initial plan, IBRA was
supposed to have already submitted the Rp 18 trillion cash by
September, but due to delays in a number of asset sale programs,
the agency could only fulfill the cash target next month.

As of August, the agency could only raise around Rp 10
trillion in proceeds.

"We will try hard to get the remaining Rp 8 trillion by
October," Harry said.