New chief brings hope to flagging IBRA

Berni K. Moestafa, The Jakarta Post, Jakarta

The Indonesian Bank Restructuring Agency's (IBRA) new chief may draw mixed reactions for his unknown track record, but analysts shared hopes of fewer controversies and politicking so as to boost IBRA's performance in its last two years of service.

At stake is around Rp 600 trillion (about US$63 billion) in state assets under IBRA control, the disposal of which is the key to getting Indonesia's sputtering economy back on its feet.

As the soon-to-be IBRA chief, Syafruddin A. Temenggung will take over the mammoth task from I Putu Gede Ary Suta.

But while the market welcomed the sacking of the controversial bending Ary Suta, Temenggung's name rings no bells for many which according to analysts may or may not be to his advantage.

"The market doesn't know him. They will need some time to assess his work," said Bank Buana director Pardi Kendy.

Temenggung, a bureaucrat by career, brings little history with him, working for the most part behind the scenes as a deputy minister for international economic cooperation, and as the secretary to IBRA's supervisor, the Financial Sector Policy Committee (FSPC).

Pardi said the market's neutral stance on Temenggung freed him from high market expectations which could easily backfire.

Bank Negara Indonesia's banking analyst Ryan Kiryanto said Temenggung's appointment might help steer IBRA away from past controversies.

"IBRA's controversies have eaten into its credibility, and that makes for hard times during talks with debtors," he said.

But the disadvantage of not being well known could come into play when politics rather than good policies becomes the decisive factor, according to banking analyst Elvin G. Masassya.

He said that being little known and having a small network could be political liabilities when pushing IBRA's often difficult policies past the bureaucracy, lobbyists and public scrutiny.

In IBRA's case, it is often said that there is too much politicking. In its four years of existence, IBRA has been led by six chairmen.

Temenggung's appointment ended weeks of speculation whether Ary Suta could survive another attempt to unseat him -- apparently the third since he became IBRA chief last June.

The game of musical chairs in IBRA began shortly after its founding in 1998. Its first chairman, Bambang Subianto, was dismissed after just three months. So was his replacement.

Critics said the reshuffles at IBRA were based more on politics than performance.

Most of the country's economic assets are locked inside IBRA, depriving the country's ailing economy of its growth engines.

While it was vital to get these assets back to work, analysts said it was no less important to protect them from errant debtors, power hungry politicians, and other vested interests.

Some believe Ary Suta fell short in the above respects. He had recently been making a slew of controversial decisions, with one granting large conglomerates favorable debt repayment terms that ended up putting the government on uneasy terms with the International Monetary Fund (IMF).

IBRA's six chairmen in four years: Bambang Subianto (January 1998 - March 1998), Iwan Prawiranata (March 1998 - June 1998), Glenn Yusuf (June 1998 - January 2000), Cacuk Sudarijanto (January 2000 - November 2000), Edwin Gerungan (November 2000 - June 2001), I Putu Gede Ary Suta (June 2000 - April 2002).