JSX to confirm amount of equity participation

JSX to confirm amount of equity participation

JAKARTA (JP): The Jakarta Stock Exchange (JSX) will confirm
the amount of its equity participation in the Clearing and
Guarantee and Central Custodian houses at the next shareholders'
meeting.

The two new houses which are required by the new capital
market law will handle the clearing and settlement of
transactions, duties which are currently held by the Indonesian
Securities Clearing Depository (KDEI).

KDEI, founded in 1993, is controlled by seven state banks --
Bank Bumi Daya (13.34 percent), Bank Dagang Negara (13.34
percent), Bank Exim (13.33 percent), Bank Negara Indonesia (13.3
percent) Bapindo (13.33 percent), Bank Rakyat Indonesia (13.33
percent), Bank Tabungan Negara (13.33 percent).

JSX and the Surabaya stock exchange own only five percent and
1.6 percent respectively.

In 1994 the house adopted a netting system for the settlement
of all shares listed on the JSX. It is now preparing a book entry
settlement system which is expected to be effective when the
stock exchanges begin scripless trading.

The new capital market law stipulates the establishment of two
different houses to carry out the function of the existing KDEI.

The law also states that stock exchanges must become the
majority shareholders of the Clearing and Guarantee house because
its role is closely related to the exchange's activities.

According to the law, custodian banks, securities companies,
and securities registration offices are allowed to have equity
participation in these two houses.

It also stipulates that other parties will also be allowed if
the total equity from these parties is not sufficient.

The Chairman of the Indonesian Capital Market Supervisory
Agency (Bapepam) I Putu Gede Ary Suta said recently that the
agency had set the establishment of these two houses as its
priority program after issuing a number of new regulations.

The JSX's president Hasan Zein Mahmud said that for the equity
participation in the clearing and guarantee house alone, JSX
should allocate some Rp 15 billion (US$6.4 million).

Equity participation is one of the eight proposals to be
approved in the JSX annual shareholders' meeting to be held in
mid April, informed sources said yesterday.

In the meeting, the shareholders will also elect new directors
and commissioners. (08)