IBRA urged to comply with court order

JAKARTA (JP): Finance companies PT Hanil Bakrie Finance and PT Hana Risjad Finance are urging the Indonesian Bank Restructuring Agency (IBRA) to repay interbank claims owed them.

Faisal Tadjuddin from Taira Faisal & Panggabean law firm, which is acting on behalf of the two companies, said IBRA should comply with a court ruling ordering it to repay the interbank claims of the two joint ventures.

"We will send a letter to IBRA seeking the agency's compliance with the court's verdict. If they do not reply within a week we will execute the court's decision," Faisal said in a statement.

He said that under the government's blanket guarantee program, IBRA was obliged to pay the matured debts of commercial banks, including closed ones.

Hanil Bakrie and Hana Risjad filed suit against IBRA at the South Jakarta District Court in September for not paying their interbank claims of US$4.5 million and $2 million, respectively, at closed Bank Umum Nasional (BUN).

In a verdict issued last week, the court ordered the agency to pay material losses consisting of the principal, overdue interest payments as well as value added tax, totaling $5.4 million to Hanil Bakrie and $2.4 million to Hana Risjad.

IBRA was also ordered to pay non-material losses of $50 million to each of the Indonesia-South Korea joint venture firms, the statement said quoting the court's verdict.

The court verdict further stated Hanil Bakrie and Hana Risjad have the right to seize the $10 million in a Bank Umum Nasional bank account under IBRA's name at Bank Central Asia.

"This account will be used as a guarantee for IBRA's unsettled debts, should IBRA not fulfill the court's verdict," the statement said quoting the court's verdict.

Faisal said the court's decision could be executed in advance, although an appeal to the Supreme Court is being filed, as reported by Bisnis Indonesia daily on Wednesday.

"With all due respect to the South Jakarta District Court, we are going to use our right to appeal to the higher court within the week," IBRA head of legal affairs Pandu Djajanto was quoted as saying by the business daily.

Pandu said not all claims were covered by the government's blanket guarantee scheme.

"Interbank claims involving an affiliated business transaction are not included in the guarantee scheme. And those parties involved in imprudent practices that cause moral hazard are not covered either," Pandu said.

Both Hanil Bakrie and Hana Risjad are finance companies who provided in October 1997 $4.5 million and $2 million, respectively, in stand-by letters of credit facilities to local finance company PT Ongko Akita Finance with BUN as the guarantor. BUN is a sister company of Ongko Akita.

Bank Umum Nasional was one of the banks closed by the government late last year as part of the government-sponsored bank restructuring program. (udi)