State firms suffer losses of $6.39b
State firms suffer losses of $6.39b
JAKARTA (JP): Finance minister Bambang Sudibyo said on Monday
that 20 state-owned companies suffered combined financial losses
of Rp 47.65 trillion (US$6.39 billion) last year.
The giant Bank Mandiri experienced the largest loss of Rp
38.86 trillion, followed by the publicly listed Bank Negara
Indonesia (BNI) with Rp 10.20 trillion.
Speaking in a hearing with the House of Representatives's
budget committee, Bambang said the primary reason for the losses
of the state banks was the negative spread between their interest
expenses and interest earnings.
He also said that Bank Rakyat Indonesia (BRI) gained a
financial loss of Rp 1.41 billion in 1999.
Bank Indonesia stated in its 1999 annual report that the
country's banking sector was still in the red last year although
profitability had slightly improved, particularly after domestic
interest rates steadily declined.
The central bank said the cumulative loss (before tax) of the
banking sector last year was Rp 91.7 trillion, but this was 48.68
percent lower compared to Rp 178.7 trillion in the previous year.
Bank Mandiri is the country's largest bank and was formed by
the merging of four state banks last year -- Bank Bumi Daya
(BBD), Bank Dagang Negara (BDN), Bank Ekspor Impor Indonesia
(Exim), and Bank Pembangunan Indonesia (Bapindo).
The government completed Bank Mandiri's recapitalization in
1999 by injecting bonds worth Rp 178 trillion, boosting its
capital adequacy ratio (CAR) to more than 12.44 percent.
The bank is planning to launch an initial public offering
(IPO) early next year in a bid to raise $1.5 billion.
Bambang said he had agreed to the bank's IPO plans. The
finance minister represents the government as the shareholder of
state banks.
The government will also soon recapitalize Bank BNI by
injecting bonds worth Rp 52.8 trillion.
The bank was hit last year by a controversy when a minister
alleged that former president Soeharto intervened in the
channeling of Rp 9.6 trillion in loans from the bank to the
textile conglomerate Texmaco Group.
Much of the loans have now fallen into the bad loan category.
Bambang added that the airline PT Merpati Nusantara booked a
loss of Rp 48.70 billion, mainly because the rupiah-based tariff
could not cover its dollar-based operational cost.
He said other state-owned firms which suffered big losses
included paper company PT Kertas Letjes (Rp 193.65 billion),
glass maker PT Industri Gelas (Rp 58.39 billion), housing
construction firm PT Pembangunan Perumahan (Rp 99 billion), and
plantation firms PTPN XIV (Rp 39.37 billion), and PTPN XI (35.65
billion).
Bambang stated that these companies were badly hit by the high
interest rate policy and suffered inefficiency due to the out of
date plant equipment.
He didn't report the financial condition of the remaining 120
state firms.
Elsewhere, Bambang said the Indonesian Bank Restructuring
Agency (IBRA) had raised Rp 11.41 trillion as of January 2000
against its Rp 17 trillion target. Rp 3.67 trillion had come from
the sale of its fixed assets, Rp 5.51 trillion from the recovery
of bank non-performing loans (NPLs) under its management, and the
remainder from other revenue sources.
Around Rp 5.59 trillion is expected to be earned from the sale
of its 45 percent stake in the publicly listed auto giant PT
Astra International, along with the recovery of NPLs and the
selling of the government bank recapitalization bonds.
"IBRA will be able to meet its Rp 17 trillion revenue target
in the current 1999/2000 budget year (ending this month),"
Bambang said. (rei)