IBRA threatens legal action against three PSP companies
JAKARTA (JP): The Indonesian Bank Restructuring Agency (IBRA) said on Monday it would take legal action against three uncooperative debtors from the Putra Surya Perkasa (PSP) group.
Senior IBRA legal officer Agus Sani Nugroho said the indebted companies refused to sign letters of commitment to settle their debts with the agency.
"Three companies were uncooperative. IBRA will take legal action against those uncooperative debtors."
"We'll take (legal action) this year," Agus said.
According to the agency's strategy, he did not go into detail on what action would be taken against the companies.
The three companies are publicly listed PT Putra Surya Perkasa, listed multifinance firm PT Putra Surya Multidana and non-listed multifinance firm PT Primaswadana Perkasa Finance. Together, the three owe more than Rp 4 trillion to IBRA.
The three companies could be the first group of indebted companies to have legal action taken against them by IBRA.
The agency began disclosing the status of its 20 largest indebted business groups or "obligors" last month.
A total of eight companies from PSP owe a combined Rp 5.10 trillion in principal debt to IBRA.
IBRA took over the bad loans from numerous domestic banks in an attempt to restructure the ailing banking industry.
The agency is attempting to recover the bad loans by restructuring them in an effort to raise cash to finance the government's bank restructuring program.
"We're not convinced about the recovery of the PSP loans," Agus said.
IBRA loan collection official Andreas Abunanta said some 90 percent of PSP companies were relatively uncooperative with IBRA and the agency's efforts to settle the debts.
"Among the five largest obligors, PSP is the most uncooperative," he said.
PSP, which is owned by the Gondokusumo family, was one of the country's fast growing business groups before running into trouble following the onset of the economic crisis in mid-1997. The group had borrowed heavily, including in U.S. dollars, to finance its various property projects.
PT Putra Surya Perkasa is an investment holding company which operates in property, finance and trade. It owes Rp 1.78 trillion to IBRA, including a U.S. dollar-denominated loan of $132 million. The company was established in 1981 and has been listed on the Jakarta Stock Exchange since 1994. The company is 66.34 percent controlled by the Gondokusumo and Angkosubroto families.
Putra Surya had total assets of Rp 2.7 trillion in 1997 and is involved in numerous property projects.
Listed Putra Surya Multidana is 73.24 percent owned by the Gondokusumo family, 19.47 percent public and 7.25 percent held by bond investors.
The multifinance firm, established in 1990, provides credit for motorcycle buyers. The company was aggressive in providing financing prior to the economic crisis.
The company had total assets of more than Rp 4 trillion in 1997 when it went public. It currently owes some Rp 1.79 trillion in nonperforming loans to IBRA including $160 million in unhedged loans. (rei)