Sjahril, Akbar to discuss reshuffle at Bank Indonesia

Sjahril, Akbar to discuss reshuffle at Bank Indonesia

JAKARTA (JP): Bank Indonesia (BI) Governor Sjahril Sabirin
plans to meet Speaker of the House of Representatives Akbar
Tandjung on Tuesday (today) to discuss the list of candidates
proposed to replace deputy governors Achwan and Dono Iskandar.

Sjahril said at the weekend that Achwan and Dono would end
their terms on May 17.

"It's up to the House to decide," he said.

According to the existing central bank law, the deputy
governors of BI are selected by the legislature from the list of
candidates submitted either by the central bank governor or
deputy governor.

Separately, Akbar confirmed on Friday the planned meeting.

Akbar said that the candidates proposed to replace Achwan
included BI internal finance director Bunbunan Hutapea, director
for banking supervision Siti Fadjriah, and Maulana Ibrahim, also
an executive of the banking supervision department.

He added that the candidates to replace Dono included BI chief
representative in New York Taslim Tajudin, BI chief
representative in Tokyo Maman Suherman, and director for research
on economy and monetary policy Hartadi A. Sarwono.

Dono had earlier been appointed to become Indonesia's envoy to
the International Monetary Fund (IMF) in Washington.

Elsewhere, Akbar said that the House would proceed with the
appointment of the two new deputy governors despite the amendment
of the central bank law.

The government has proposed a bill to the parliament to amend
the central bank law. One of the points in the proposed
amendment is for the existing BI board of governors to resign
once the House approves the bill.

The House will resume debating the proposed amendments on
March 12, but Akbar said that the deliberation had so far been
slow and it was still uncertain when it would be completed.

The IMF had earlier expressed concern over the proposed
amendment as it could threaten the independence of BI. The Fund
delayed the disbursement of its third loan tranche to the country
late last year partly due to this concern.

But the government has insisted that the amendment was needed
to boost the accountability of BI.

Dono and Achwan are among the five top BI officials who
tendered their resignation last November following calls from
President Abdurrahman Wahid for BI board members, including
Sjahril, to resign as part of efforts to reshuffle and clean up
the central bank from past corrupt practices.

The three other top BI officials who tendered their
resignation were senior deputy governor Anwar Nasution, and
deputy governors Miranda Goeltom and Burhanuddin Abdullah.

But the three remain active until now.

The resignation of the top BI officials was made at a time
when Sjahril was still under the custody of the Attorney
General's Office over alleged involvement in the high profile
Bank Bali scandal.

Sjahril has denied any wrongdoing and also rejected calls from
the President to resign. He is now under trial as a defendant in
the Bank Bali scandal.

BI had been troubled for more than a year due to a dispute
with the government over the controversial emergency liquidity
support for ailing domestic banks.

The government, via the central bank, injected some Rp 144.5
trillion in emergency loans into troubled domestic banks between
September 1997 and January 1999 to help reimburse depositors'
money at a time of massive bank runs.

But the Supreme Audit Agency (BPK) revealed in its audit
report that some Rp 138 trillion of the liquidity support
facilities had been improperly channeled by BI.

After months of debate, the government and BI finally agreed
last November that the central bank would pay Rp 24.5 trillion to
help cover the losses by issuing bonds to the government. (rei)