Legislators seek probe on bad debts
Legislators seek probe on bad debts
JAKARTA (JP): The monetary authority must take to court the
management of state banks suspected of violating banking rules
and bad debtors who inflicted huge losses on state banks, a
legislator from the ruling Golkar said on Wednesday.
Thomas Suyatno said bad bankers and debtors at state banks had
been partly responsible for the country's current economic
crisis.
"The government has to be fair," he said on the sidelines of a
hearing of the House of Representatives Commission VIII for
finance and the state budget.
Thomas said he had a list of the country's 50 largest debtors
at state banks, with the largest debt owed by a single debtor
totaling Rp 8.7 trillion (US$983 million) while the "smallest"
debt reached Rp 1.4 trillion.
He said he would ask his fellow legislators to push for legal
action against those causing the huge amount of bad debts at
state banks.
"If the government bars errant bankers from traveling out of
the country, these people (debtors) have to be included as well."
Asked to comment on this, Bank Indonesia Governor Sjahril
Sabirin also vowed to take to court those suspected of breaching
banking regulations at state banks.
He said the authorities would bring to court the management
and owners of the 38 private banks closed by the government last
week who were suspected of violating banking regulations.
He also said the central bank would draw up a list of errant
bankers to be barred from leaving the country.
Thomas was chief commissioner of Bank Aspac and a commissioner
at Bank Uppindo. The two banks were among the 38 banks closed by
the government last week.
Thomas denied a report that he and his family had left the
country to avoid investigations for possible wrongdoings.
"I am an Indonesian citizen and will never leave this beloved
country," he said.
"I have never breached any bank regulation during my 30 years
in the industry," he added.
Following the closure of Bank Aspac, its staff held a
demonstration demanding compensation from the bank's owners in
addition to the government's severance package.
Employees at other closed banks also have held similar
demonstrations, making it impossible for depositors at closed
banks to withdraw their deposits, which are guaranteed by the
government.
The Indonesian Bank Restructuring Agency (IBRA) demanded
several bank owners meet with their employees to discuss their
demands.
Thomas, however, lambasted IBRA for failing to act firmly in
dealing with the problem.
He said bank owners, management and commissioners were barred
from entering the closed banks according to the agency's March 13
letter.
He said the letter effectively put the closed banks in the
hands of the agency.
"So it is IBRA which has to take the responsibility. If the
bank employees are creating difficulties, the agency must act
according to new banking regulations which classify such actions
as crimes."
"Will IBRA dare to act accordingly," he asked?
Legislators Paskah Suzeta, also from the Golkar faction, and
Uray Faisal Hamid from the United Development Party faction urged
the government to provide bridging finance to settle severance
payments to employees of the closed banks.
"To reduce tensions, the government should advance the
payments for the severance compensations. Don't let these jobless
people suffer," Faisal added.
The government launched major bank restructuring measures on
March 13, including closing 38 banks, taking over seven banks and
identifying nine banks which would be recapitalized.
Sjahril reiterated late Tuesday that owners of the nine banks
to be recapitalized had committed to raising 20 percent of the
recapitalization funding before the April 21 deadline. Under the
program, the government will provide the other 80 percent of the
recapitalization funding.
Banks which cannot raise their 20 percent of the funding by
the deadline will be closed down. (rei)