Payment to continue for Bank Global depositors

Urip Hudiono, The Jakarta Post, Jakarta

The Ministry of Finance will disburse some Rp 498.15 billion (US$53.85 million) on March 9 for the payment of 713 bank account holders of the recently closed-down Bank Global.

The ministry's director general for financial institutions Darmin Nasution explained on Wednesday that the Development Finance Comptroller (BPKP) and the finance ministry's bank guarantee implementation unit (UP3) found the accounts -- from the 809 accounts worth Rp 505.13 billion that it had verified -- to be eligible under the blanket guarantee program.

"The rest will not be covered as they are linked to the bank's management," he said. "The accounts of depositors who still have liabilities with the bank will not be covered either, pending further verification."

Darmin said the government would not cover public funds in the bank's mutual funds, as they are classified as the bank's capital and not its third-party liabilities.

The BPKP and the UP3 had received the data of 9,872 accounts worth Rp 1.25 trillion from Bank Global's management for verification.

In its previous verification of 1,707 accounts worth Rp 5.74 billion, the ministry said 1,685 accounts worth Rp 1.89 billion would be covered by the government's blanket guarantee program. As of Feb. 24, the government had paid 202 account holders over Rp 280 million through Bank BNI.

Bank Indonesia officially closed down Bank Global on Jan. 13, after suspending its operations for a month, on the grounds of failing capital and overt evidence of bank fraud activities.