Korea helps IBRA with asset disposal program

JAKARTA (JP): The Korea Asset Management Corporation (KAMCO) agreed here on Tuesday to help the Indonesian Bank Restructuring Agency (IBRA) sell the assets it has received from the former owners of the country's closed and recapitalized banks.

KAMCO executive director Cheong Hong Kim said his office would share with IBRA some of its experience in managing distressed assets so as to help the latter accelerate the debt restructuring program.

"Yes, we'll definitely help IBRA to sell its assets. We'd like to share the expertise and experience we gained from our own asset disposal program," he told journalists after the signing of a collaboration agreement between the two agencies.

KAMCO is an agency established by the South Korean government to buy, restructure and sell non-performing loans (NPLs) from the Korean financial institutions which collapsed during the country's economic crisis.

Cheong said KAMCO had so far restructured 46 percent, or about US$31 billion, of the total $67 billion of NPLs and sold $5.5 billion worth of assets in both international and domestic markets as of June.

Under the agreement, KAMCO and IBRA will share experience and expertise in asset disposal management through a human resources exchange program and workshops, said IBRA chairman Cacuk Sudarijanto.

"We'll also cooperate in join marketing to resolve the problem of distressed assets in both countries so that value can be realized at the optimum price," he said.

According to Cacuk, KAMCO, the first foreign debt restructuring agency accepting IBRA's offer of collaboration, would also provide expertise in repackaging assets in order to boost their market value.

IBRA has received some Rp 600 trillion in assets transferred from the owners of ailing and closed banks as repayment for the massive emergency funds they received from the government at the peak of the country's economic crisis in early 1998.

The agency is expected to raise some Rp 6.5 trillion from the disposal of the assets during the April-December 2000 fiscal year.

Some Rp 250 trillion out of the Rp 600 trillion assets managed by IBRA are non-performing loans (NPLs) transferred by the country's ailing banking sector. (cst)