Recapitalization of BRI finished soon: Bambang

JAKARTA (JP): Finance Minister Bambang Sudibyo said on Tuesday that the crucial recapitalization program of the state Bank Rakyat Indonesia (BRI) would be completed "soon."

Bambang said that the government was waiting for the go-ahead from President Abdurrahman Wahid.

"We're still waiting for the final decision of the President on who will be the management team (of BRI). God willing, it will not be too long," he told reporters following a meeting with other senior economic ministers and Bank Indonesia officials.

Asked whether the government has any target date, he said: "A minister can't give the President a deadline."

The government was supposed to have already recapitalized BRI in May, but it was delayed due to the "dispute" between Abdurrahman and Bank Indonesia on who would run the bank.

A management reshuffle is a precondition for the recapitalization of the bank.

Abdurrahman has picked Prijadi Praptosuhardjo, now a director at BRI, to become the new president of the state bank, but he and several other would-be BRI top management people were reported to have failed the fit-and-proper test conducted by Bank Indonesia.

The fit-and-proper test basically determines a banker's past behavior and performance, particularly in relation to whether he or she has been involved in the violation of banking rulings.

Abdurrahman is reported to have asked Bank Indonesia Governor Sjahril Sabirin to repeat the test, but the latter said he would decline unless there was new information.

Sjahril is now under the detention of the Attorney General's Office over alleged involvement in the high profile Bank Bali scandal.

The government has nearly completed the country's bank recapitalization program except for BRI, Bank Bali and another state-owned bank, Bank Tabungan Negara (BTN).

Bambang also said that the recapitalization program of BTN was expected to be completed soon once a decision on the future role of the bank had been reached.

Bank BTN has traditionally been a lending institution focusing on housing loans.

But under the government bank restructuring program there was a plan to revise the traditional role of the bank.

The Finance Minister and Housing Minister have formed a working group with other stakeholders to develop a new housing finance strategy during the second quarter of this year.

The recapitalization of BTN would be based on the housing strategy adopted.

The government was also supposed to have recapitalized Bank Bali in May, but a legal dispute between the bank's former owners and CEO Rudy Ramli on one side, and Bank Indonesia and the Indonesian Bank Restructuring Agency (IBRA) on the other prompted the government to delay the program.

The government has insisted that Rudy drop his lawsuit against IBRA and BI as a precondition for the recapitalization of the bank.

The government expects to reach a final decision on the fate of Bank Bali later this week -- either to recapitalize or liquidate the bank. (rei)