The case of Sjahril Sabirin

Due to some media reports of March 8, we would like to clarify certain statements made in regards to the legal proceedings at the Central Jakarta District Court, with Sjahril Sabirin as suspect, whereby Bank Dagang Negara Indonesia (BDNI) has placement in Bank Bali.

The facts and current status as of this date are as follows: 1. Regarding Bank Bali's cessie:

The payment made by BDNI to Bank Bali amounting to Rp 904.5 billion was made on June 1, 1999. However it should be noted that such payment was made by the Indonesian Bank Restructuring Agency (IBRA) nine months after BDNI was frozen on Aug. 21, 1998. 2. Regarding BDNI's settlement of Rp 563 billion:

The court testimony made by a witness from Bank Indonesia in the Sjahril Sabirin case about the BDNI placement of Rp 563 billion to Bank Bali was misleading and obviously unrelated to the case.

BDNI's placement of Rp 563 billion was an entirely different transaction from the Bank Bali Cessie payment. BDNI had settled the entire Rp 563 billion placement during the height of the currency crisis between December 1997 and in early February 1998, or during the period before BDNI was taken over by IBRA on April 4, 1998. 3. Regarding BDNI's use of the Rp 563 billion:

BDNI's placement of Rp 563 billion was a proper transaction done according to normal market standards. The transaction was done when the rupiah was depreciating in 1997, in order to meet BDNI's large customer demand for U.S. dollars. A report stating that BDNI made US$175 million in foreign exchange profit from this transaction is incorrect.

In fact, BDNI suffered loss from this transaction. 4. Regarding BDNI's Nov. 20, 1997 reply to Bank Indonesia:

The report stating that BDNI did not reply to Bank Indonesia's letter was incorrect. In fact, BDNI had sent a letter under reference no. 132/DIR-TG/1197 dated Nov. 20, 1997 to Bank Indonesia, responding to all questions raised by Bank Indonesia concerning the Rp 563 billion placement.

DR. ADNAN BUYUNG NASUTION

Adnan Buyung Nasution & Partners

Jakarta