Lippo management could face dismissal
Lippo management could face dismissal
Tony Hotland, The Jakarta Post, Jakarta
Top officials of troubled Bank Lippo may face dismissal if they
are found guilty of having intentionally concealed the bank's
financial situation, according to a senior official of Bank
Indonesia (BI).
"Concealing information is a very serious offense and should
be looked into. The management can be dismissed if they are
proven (guilty) as happened with the management of BNI," BI
senior deputy governor Anwar Nasution said on Wednesday.
The management of Bank Negara Indonesia (BNI) was reshuffled
late last year, and most of its top officials dismissed after the
disclosure of fictitious export credit worth Rp 1.7 trillion
(US$141.17 million).
Anwar refused to comment any further, explaining that he had
not grasped the whole problem and he had not yet received reports
on the matter from Lippo.
Anwar was commenting on Lippo's 2003 financial report, made
public on Tuesday, in which it was stated that the bank
experienced a net loss of Rp 515.9 billion last year.
Its November report, however, showed an Rp 18.6 billion profit
with no indication of losses.
Lippo president Joseph Luhukay explained that the contributing
factor to the losses was Rp 367 billion in taxes on the bank's
unsold foreclosed assets valued at Rp 2.5 trillion.
These taxes also shot down the bank's 2003 capital adequacy
ratio (CAR) to 17.9 percent from 21.1 percent in 2002.
The Indonesian Bank Restructuring Agency (IBRA), which owns a
54.9 percent shares in Lippo, has named a consortium led by
Swiss-first Asia Global as the preferred bidder for a 52 percent
share of the publicly listed bank. The consortium offered a final
price of Rp 591.5 per share. IBRA has been trying to sell its
shares in Lippo.
Other Lippo shares belong to public investors (35.5 percent),
and to Lippo E-Net (9.6 percent), which is controlled by the
Riady family. The family once controlled the bank.
The director of bank licensing and information at BI, Siti
Fadjriah, said that an assessment of the consortium would not be
conducted until the central bank finished scrutinizing all
documents submitted by the consortium.
"We're still examining the documents. If they're complete, we
can do a fit and proper test; even by the end of this week," said
Siti.
Asked about the possibility that the consortium would request
a reduction in the price due to the poor performance of the bank,
Siti said that "it was their decision to buy the shares. In
addition, IBRA was using the 2002 annual report as the base when
selling the shares".