Lippo expects to recover at least 50% of its assets

Lippo expects to recover at least 50% of its assets

Tony Hotland, Jakarta

Bank Lippo aims to recover at least 50 percent of its foreclosed
assets, valued at about Rp 2.3 trillion (US$245.2 million), the
sales of which will be decided on June 29 during the publicly
listed bank's shareholders meeting.

Bank Lippo president Joseph Luhukay said on Tuesday the
assets, mostly property, were to be sold because the bank needed
to spend Rp 300 billion annually in carrying costs and
opportunity loss.

"Keeping the assets is very costly. We have to pay taxes on
property and real estate, fees to guard and maintain the assets,
and other costs," he told reporters after a meeting with House of
Representatives Commission IX on financial affairs.

If shareholders agree to sell the assets, Joseph said sales
would be regulated to ensure a maximum recovery rate.

The foreclosed assets were taken as collateral from defaulting
debtors in the wake of the late-1990s financial crisis.

"If the sales plan is agreed upon, it would probably take
three to four years to complete. We must observe market
conditions and potential buyers. We won't rush to sell all the
assets because of their great value," he said.

Joseph further said the management was now reviewing Lippo's
2004 target, as he claimed that the bank's first-quarter
performance had surpassed their projection.

"I'm optimistic about our growth. As of June, we've grown by
up to 30 percent compared to the same period last year. Our non-
performing loans comprise only 0.6 percent of total loans," he
said.

Bank Lippo is 52.02 percent owned by Swissasia Global, 35.5
percent by the public, 9.6 percent by Lippo E-Net and 2.88
percent by an asset management company.