IBRA's account freezed

IBRA's account freezed

JAKARTA (JP): In an unprecedented move, the South Jakarta
District Court has temporarily suspended the bank account of the
Indonesian Bank Restructuring Agency (IBRA) in Bank Central Asia
until a dispute with finance company PT Hanil Bakrie Finance is
legally settled.

The court also suspended a US$6.54 million account of finance
firm PT Ongko Akita Finance in the now defunct Bank Umum Nasional
(BUN), which is guaranteed by IBRA, an agency under the Ministry
of Finance.

"There are enough reasons according to the law, to grant the
appeal of the plaintiff for the suspension," the court said in
its ruling issued on Monday.

Hanil filed suit on Sept. 22 against IBRA for the latter's
alleged failure to pay $4.5 million in a guaranteed claim.

Under the government blanket guarantee program, all
obligations of closed-down banks, including interbank loans, are
guaranteed by IBRA.

Hanil extended a $4.5 million loan to Ongko Akita Finance with
BUN as the loan guarantor in October 1997. BUN is a sister
company of Ongko Akita.

BUN was among the many banks closed down last year by the
government in a bid to restructure the country's ailing banking
sector.

Hanil has argued that under the government blanket guarantee
program, IBRA was obliged to pay the matured debt of closed-down
commercial banks. (rei)