JSX delists 10 companies, including four closed banks
JSX delists 10 companies, including four closed banks
JAKARTA (JP): The Jakarta Stock Exchange (JSX) on Friday
delisted ten companies, including four banks closed by the
government last year, and warned 37 other corporations of a
similar punishment unless they improved their businesses.
The delisted companies are PT Bank Surya, PT Bank Umum
Nasional, PT Bank Dagang Nasional Indonesia, PT Bank Modern, PT
Perdana Inti Investama, PT Great Golden Star, PT Dharmindo
Adhiduta, PT Ometraco Corporation, PT Dharmala Agrifood and PT
Intinusa Selareksa.
"The ten delisted companies suffer from liquidity problems and
huge foreign exchange losses," JSX director Felia Salim said.
Although the companies have been delisted, legally they still
are considered public companies, Felia said.
As such, they are required by transparency regulations to
present their financial reports to the Capital Market Supervisory
Agency and also to their shareholders.
The JSX said in a statement that the ten companies had not
shown satisfactory improvement in their financial and business
performances since being included on the JSX's monitoring list,
along with 37 other companies. The statement did not say when the
companies were put on the list.
Felia said the other 37 companies had shown improvement but
would still face delisting if they did not further strengthen
their ailing businesses.
According to existing stock market regulations, listed firms
booking financial losses amounting to half or more of their paid-
up capital at the end of the last calendar year or which suffer
losses in three consecutive years will be delisted.
Last year, the JSX delisted several companies, including PT
Perdana Inti Finance.
Economist Sri Mulyani Indarwati welcomed JSX's move to delist
companies which performed poorly.
She said that allowing troubled companies to remain on the
exchange would prevent investors from entering the local market.
"They (the delisted companies) were not liquid anymore and
were not managed efficiently, including the closed banks. They
should have been cleared from the exchange sometime ago because
they had no meaning to investors."
She noted that the current dominance of finance and property
firms on the JSX was not healthy. Such firms make up more than 60
percent of corporations listed on the exchange. The current
debacle in the banking and property sectors, which has negatively
impacted the exchange, has proven that having any one sector
dominate the exchange is a recipe for disaster.
"The bourse, which should be an alternative source of
financing for the business sector, suffers the most. This is
ironic."
She suggested that JSX management be more prudent when
selecting which companies it allows to raise public funds on the
exchange.
"In the medium and long term, the JSX has to select stronger
companies which can better weather any crisis. Such companies are
agriculture and mining-based companies. These are the strongest
firms but are the least represented on the JSX," Sri added.
(gis/02)