Minister confirms naming of new IBRA chief

Minister confirms naming of new IBRA chief

Dadan Wijaksana, The Jakarta Post, Jakarta

State Minister for State Enterprises Laksamana Sukardi said on
Thursday that the government was planning to replace the chairman
of the Indonesian Bank Restructuring Agency (IBRA), but added
that a replacement had yet to be chosen.

He was responding to an earlier report in Kompas quoting a
source as saying that President Megawati Soekarnoputri had
approved the appointment of economist Arif Arryman as the new
chairman of the powerful agency, which controls billions of
dollars in assets transferred from ailing banks and indebted
conglomerates.

"I don't know where that came from, but we still have not made
a decision," Laksamana was quoted by Reuters as saying in
response to the report, adding that there was no timeframe for
the announcement.

The state minister of state enterprises oversees IBRA.

There has been speculation over the last several months that
Laksamana would dismiss incumbent IBRA chairman I Putu Gede Ary
Suta, who was originally appointed as the agency's sixth chairman
in June of last year by then-president Abdurrahman Wahid.

Although Laksamana had rejected speculation of a dismissal, he
has made decisions in recent days which only lend credence to
rumors that the two could no longer agree on various policies.

Their series of disagreements reached a critical stage weeks
ago, when Laksamana took over the authority of IBRA to determine
the winner for the Bank Central Asia (BCA) sale.

Laksamana's decision to deny IBRA its right to set a winner
for BCA showed the agency's lack of credibility.

Ary Suta, a former chairman of the Indonesian capital market
watchdog Bapepam, had also been widely criticized for proposing a
controversial policy to ease debt repayment terms owed by former
bank owners to IBRA. The proposal was recently rejected by the
government at a Cabinet meeting.

The sale of the publicly listed carmaker PT Indomobil Sukses
International last year to a consortium led by Tri Megah
Securities, has also raised suspicions that former owner Salim
Group had been behind the deal.

The government has barred Salim from repurchasing its assets
which have been transferred to the agency.

Meanwhile, Ary Suta declined to speak on the reports of his
imminent dismissal. "No comment, no comment," he said, when
queried by reporters.

But Ary Suta made a statement on Wednesday which may discredit
Arif Arryman.

On Wednesday, when he spoke to reporters during a break from a
hearing with legislators, he seemed to accuse Bank Negara
Indonesia (BNI) of greatly marking up the size of its non-
performing loans (NPLs) transferred to IBRA to obtain a greater
amount of bank recapitalization bonds from the government.

He said that BNI put the size of its NPLs at US$1.2 billion
but, based on IBRA's audit, the amount turned out to be $12
million.

Arif, a former deputy chief for economics minister Rizal
Ramli, is a commissioner at BNI. He is also the managing director
of the Econid Advisory Group, a private think-tank founded by
Rizal and Laksamana.

The president of the publicly-listed Bank Danamon, Arwin
Rasyid, has also been rumored to be in the running for the IBRA
chairmanship. He was previously a deputy chairman at the agency.

Another candidate is Abdul Gani, the former president of
Indonesia's national airline, Garuda, and a former banker.

IBRA controls more than Rp 600 trillion worth of assets
transferred by indebted bank owners, and is mandated to
restructure or sell the assets to raise cash to help finance the
huge deficit in the state budget.

The agency is targeted to raise around Rp 48 trillion in cash
this year to help finance the 2002 state budget deficit.